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Covid-19 to cut demand for heavy truck trailers

LONDON, September 23, 2020

East European demand for both trailers and trucks has continued to plunge in 2020 following the onset of Covid-19.  
 
The East European trailer demand forecast for the five-year period from 2020 to 2024 has been reduced by 52,000 trailers with the largest markets of Turkey, Poland and Russia accounting for over 60% of that reduction, said Clear International in its just issued September 2020 forecast for the East European Heavy Truck Trailer Market.
 
The largest fall in demand will occur in Poland – a country that was a model of stability in the 2009 Global Financial Crisis – Poland was the only country in Europe not to have a recession in that year.
 
Russia, the largest trailer market in Eastern Europe until 2010, suffered a 50% fall in demand between 2011 and 2015, but had an astonishing recovery in 2017/18 and is now the largest market once again.  Turkish demand reached a new low in 2019 but recovery has already begun, though it will remain in third place behind Poland until the end of the forecast period.
 
Demand for trailers grew by 4.4% in Eastern Europe in 2018 then fell by 12.7% in 2019 as evidence of a cyclical downturn became more apparent.  At the beginning of 2020 another modest decline in trailer demand was forecast for Eastern Europe but the outlook quickly worsened as the Covid-19 pandemic started to close down parts of the economy.  
 
A reduction of new trailer registrations of 24.5% if now forecast for 2020, and that figure assumes that the second wave of the virus that is already in evidence is at least contained.
 
Trailer sales in 2018 were the third highest on record, only surpassed in 2007 and 2008.  The forecast now is that registrations of new trailers will not match the 2007/8 level until after 2024 but will surpass the 2018 level in that year.
 
However, the short-term outlook is anything but positive.  
Whereas the demand for road transport (measured in tonne-km) in Western Europe has yet to recover to the levels that were typical before the 2009 recession, in Eastern Europe both domestic and international road transport demand has continued to grow every year.  Every year that is until 2018 when growth stalled.  Slowdowns in Bulgaria, Czechia, Estonia, Poland and Hungary were enough to halt the growth which has been continuous since 2000.  There was some growth in demand in 2019 but this was mostly due to international activity in Poland and Lithuania and it will not be sustained into 2020.
 
Gary Beecroft, managing director of Clear International commented: “Turkey will be the only country in Eastern Europe to see any growth in trailer demand in 2020 but it is recovering from a very low base.  Russia will have the smallest decline in the region.  Other countries will see falls of between 15% and 50%.”
 
BACKGROUND
Many East European countries joined the EU in 2004-07, which resulted in booming demand for trailers. In particular, semi-trailer demand rocketed as the volumes of international transport increased, both within Eastern Europe and between East and West.  
 
From 2002 to 2007 the compound annual growth rate for trailer demand was 25.7%.  Demand broke the 100,000- unit barrier in 2007 but fell to 40,000 in 2009 as a result of the GFC.
 
Some 77% of goods in Europe are moved by road and most of that proportion is transported in a trailer.
-- Tradearabia News Service
 



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