TORONTO, (July 25, 2005) — The foreign supplier landscape for the U.S. trailer industry changed dramatically last year, with Canada and Mexico losing ground to Asia.

Economic analyst firm Global Insight’s Ken Kremar says U.S. trailer sales were approx. $6 billion in 2004, while imports were $619 million, up 36 percent from ’03, reports Heavy Duty Trucking.

“Historically, Canada and Mexico have dominated the import scene, accounting for more than 90 percent of equipment and parts sources outside the U.S.,” says Kremar. “Things changed in a big way last year as imports from China more than quadrupled, jumping from$16.5 million in ’03 to $91.6 million.”

Mexico accounted for 45.4 percent of total imports, Canada 36 percent, China 14.8 percent, and the rest of the world 3.8 percent. Kremar predicts ’05 isn’t expected to match the 27 percent trailer shipment growth in 2004, while 2006 may see some diversion of financial resources as 2007 EPA emissions standards trigger a surge in heavy truck pre-buying.

In the past, major down cycles in trailer business have only occurred when GDP contracts or when economic growth all but grinds to a halt, reports HDT. The U.S. economy is slated to expand 3.7 percent this year, 3 percent in ’06 and roughly the same the year thereafter.

“There will be enough of a favourable tilt to the economy to keep trailer demand at very lofty levels,” Kremar says, “but not enough to keep demand and production heading higher ad infinitum.

“There is no major correction in the offing as best we can tell, but some erosion in demand is likely as the pace of economic and end-market activity slows and replacement and expansion pressures begin to subside.”

As for China: “There is little reason to believe that they are not going to look to expand on the foothold they now have in the North American market.”

— from Heavy Duty Trucking