FTR reports a significant dropoff in U.S. trailer orders in May, falling 56% from the April level to 5,766 units, which is down 14% year-over-year and 65% below the average for the last 12 months. The number of trailers ordered over the last 12 months now totals 198,200 units.

FTR says the May decrease was primarily driven by a substantial drop in gross orders coupled with the sustained high level of cancellations. Trailer production decreased by 5% month-over-month and 22% y/y in May, totaling a still relatively high level of output at 21,781 units. This build level is 10% lower than the average May level over the past five years.

With net orders coming in substantially below production levels, backlogs in May dropped, falling by almost 18,500 units to end at slightly more than 128,500 units. The larger m/m decrease in backlogs than in production resulted in a decrease in the backlog-to-build ratio to 5.9 months. This ratio is the second lowest level since 2020 and is right in line with the historical average prior to 2020. The current ratio indicates little overall incentive for trailer manufacturers to adjust production levels, FTR said.

“Truck freight hasn’t entered a recovery yet despite occasional signs of improvement,” said Dan Moyer, FTR senior analyst for commercial vehicles. “The softness is particularly reflected in this month’s lower orders in the dry van and refrigerated van segments, although reefer van orders are still up y/y for 2024 to date. Strength in the vocational market appears to be bolstering flatbed orders. With trailer orders surprising on the downside, backlogs continuing to decrease, and high trailer dealer inventory, build levels and rates will face increasing downside pressure as we continue through the slower summer order months.”