Editorial: Signs Say Trucking Is Back

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he sounds of celebration that emanated from the big Mid-America Trucking Show in Louisville, Ky., March 25-27 were bouncing all around the country last week, as the supplier and show industries reveled in the latest evidence that trucking is back.

Organizers of other shows scheduled for Baltimore, Dallas, Las Vegas and Anaheim, Calif., said they had also seen more interest this year from exhibitors reserving space.

But the buzz from MATS generated even more excitement and phone calls and bookings for the coming shows, with the crowds in Louisville convincing vendors that truckers are ready to spend on equipment and services again.

Meanwhile, some truck manufacturing executives were saying the recovery of the market for new Class 8s was so solid that it should last for years.

Thus far in 2004, the demand has been so strong that two builders — Freightliner and Mack — said they had already filled more than half their entire year’s production slots.

It’s been a long time coming.

After all, it was nearly four years ago that a recession hit the manufacturing sector and weakened trucking along with it. By early 2001 the recession had spread to the entire economy, even before the 9/11 terrorist attacks further weakened freight demand.

Then there was the “pre-buy” era as truckers rushed to get vehicles with engines built before new technology would be required for tougher emissions rules starting October 2002. Afterward, sales of new trucks plunged. For about a year buyers stayed away in droves until suppliers could tweak the new engines and the market got used to them.

The first part of 2003 saw the recovering economy stumble as war concerns and a sharp spike in motor fuel prices raised fears that recession could return. But helped along by timely cuts in interest rates and taxes, the economy regained its footing.

Demand improved for freight hauling, and eventually fleets began ordering more equipment.

To be sure, some reason for caution remains. Truck makers say they will not build more brick-and-mortar capacity for now. They do not want to ramp up in case the surge in current demand turns out to be partly fueled by early pre-buy ahead of 2007, or some other factor develops to weaken orders. And there are factors like the record-high gasoline and still-rising diesel prices that could slow economic growth.

But the need to replace aging fleets, to plan equipment purchases before the next changes in emissions rules and while financing costs are low, and just the continued growth of the economy all suggest that truckers may keep buying for some time.

This story appeared in the April 8 edition of Transport Topics. Subscribe today.