Improved business activity and increased consumer spending will aid industry growth.
Los Angeles, CA (PRWEB) December 03, 2013
Over the five years to 2013, revenue for the Truck Trailer Manufacturing industry is expected to increase. However, this surge in revenue masks volatility that the industry endured over the period. In general, the performance of this industry correlates with activity from the trucking and freight services industries. When the recession struck, demand for freight services fell dramatically. Data from the American Trucking Associations (ATA) suggests that truck freight tonnage (an ATA index that measures the gross weight of freight transported annually) fell during 2009, its largest decline since 1982. As a result, trucking companies could not afford to purchase new truck trailers in the midst of such a depression.
Nevertheless, in 2010 trucking demand picked up due to increased consumer spending, more business activity and lower unemployment. This trend, in turn, generated demand for truck trailer purchases from companies that needed to add fleet volume or update existing fleets from purchases deferred during the downturn. Heavy demand led to rapid production and a remarkable turnaround for the industry. According to data from industry publication Trailer/Body Builders' annual survey, the total number of truck trailers produced from the industry's 25 largest companies skyrocketed in 2011 and 2012. As freight trucking activity continues to improve in 2013, IBISWorld expects industry revenue to rise during the year.
According to IBISWorld Industry Analyst Brandon Ruiz, “In 2013, the top three players, Wabash National Corporation, Great Dane Limited Partnership and the Utility Trailers Manufacturing Company, are estimated to account for more than half of the industry's market share.” These large companies benefit from significant brand recognition, and they have established distribution channels with trucking companies, independent dealers and wholesalers. Market share concentration among the top three players has increased in the past five years; during the recession, smaller companies left the industry and major players obtained consumers who previously bought from smaller companies. Also, market share has increased as players partake in mergers and acquisitions. IBISWorld expects industry concentration to increase in the next five years as industry operators continue to acquire smaller companies to expand production capacity in the midst of rising demand.
Looking ahead, “IBISWorld expects revenue for the Truck Trailer Manufacturing industry to grow during the five years to 2018,” says Ruiz. However, this growth will not come without surmounting some potential challenges. Rising oil prices and looming fuel economy standards for downstream truck manufacturers may alter the direction of the industry. Industry operators will have to adapt to new technologies that make truck trailers lighter and more aerodynamic, supporting the fuel efficiency of heavy-duty trucks. This trend will likely hurt the profitability of smaller companies that lack sizeable economies of scale or sufficient research and development funding. However, many of the industry's dominant companies will find success in new product development, prompting sales and buoying industry growth in the long run.
For more information, visit IBISWorld’s Truck Trailer Manufacturing in the US industry report page.
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IBISWorld industry Report Key Topics
Operators in the Truck Trailer Manufacturing industry produce trailers that are specifically designed for use on heavy-duty trucks. Trailer types vary based on size and purpose, and include dry van, flatbed and refrigerated trailer varieties. This industry does not include light truck trailers or travel trailers.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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