Road Trailers Market

Market Overview

Europe and North America dominate the global road-trailer market. They are used for intermodal freight transit and are manufactured following International Organization for Standardization (ISO) regulations. They are appropriate for numerous modes of transportation, including trucks. Demand for road trucks is highly impacted by expanding need for consumer goods and rising industrial production output. 

Manufacturing and agriculture are the primary consumers of the market. With rapidly growing urbanization, changing market dynamics, and an increasing number of supermarkets, demand for trailers is increasing in Asia-Pacific. Currently, India and China provide significant growth opportunities for trailer manufacturers to enter the market and gain market share by beginning local trailer production.

The global road trailers market is expected to grow at a CAGR of 5.0% during the forecast period, i.e., 2021–2029.

Market Dynamics

The Widescale Cold Chain Industry to Stimulate the Market

Due to the lack of competent refrigerated transportation systems, it has been estimated that more than 40% of food produced in developing economies is lost or wasted before reaching its intended consumers. As a result, producers suffer substantial income losses. However, fast-evolving technology and a rising number of temperature-controlled trailer manufacturers are predicted to help reduce food loss by more than 20%–25%.

Aside from that, individuals spend less time on food preparation due to changing lifestyles, a more hectic work schedule, increased discretionary income, and a growing working women population. This has increased demand for frozen foods such as frozen fruits and vegetables, seafood, pork, and chicken. Furthermore, the number of pharmaceuticals requiring an effective temperature control supply chain has grown. The combination of improved disposable income, a general push for fresher, healthier products, and an increase in the number of quick-service restaurants (QSRs) impacts all aspects of the cold chain business. 

Retailers anticipate increased demand from their upstream partners for cold chain products. The top 25 warehousing businesses now account for more than 15% of worldwide cold storage capacity. It has become critical to have an uninterrupted supply of cold-chain, which essentially involves refrigerated container trailers, to ensure product quality without impacting shelf life. The continuously growing number of supermarkets adds to the need for these trucks.

Stringent Fuel Efficiency Targets to Hamper the Market Growth

Many governments worldwide have implemented programs and policies to improve the environmental performance of heavy-duty trailer fleets in response to the growing side-effects of the trucking sector on climate change and local air quality. This section focuses on particular initiatives that governments and the private sector have put to reduce the fuel consumption and emissions related to commercial trailers. 

Voluntary green freight initiatives and various components of these programs have aided in the rapid adoption of trailer fuel-saving technologies. For example, in the United States and Canada, as part of Phase 2 legislation, trailer manufacturers are expected to fulfill increasingly severe efficiency objectives by combining aerodynamic, tire, and weight reduction technology.

There are four verification levels for trailer aerodynamic technologies, which signify fuel consumption reductions relative to a baseline 53-ft (16-m) box-type trailer: 1%, 4%, 5%, and 9%. Side skirts, rear-end devices (e.g., boat tails), trailer underbody devices, and gap reducers are examples of these technologies. Aerodynamic device makers can validate their equipment's fuel savings through track testing, wind tunnel testing, or computational fluid dynamics.

Emerging Economies to Generate Profitable Market Opportunities

North America and Europe currently account for more than 60% of worldwide road-trailer production. However, when producers compete with many players and supply quality items to remain in the market, manufacturing costs rise to a high level, reducing net profit margins. This is a lucrative opportunity for market participants to develop their production line or facility in economies with abundant raw materials and favorable government policies. According to our findings, Asia-Pacific and South America provide an excellent potential for market participants to expand their presence and establish manufacturing plants in these regions. 

This would allow the participants to take advantage of low-cost labor, plentiful raw materials, improved operational efficiency, and favorable government regulations. Due to a rapidly rising population and a movement in the number of manufacturing businesses to this region, the industrial output and supermarket network have significantly increased in the last several years. Furthermore, the ongoing trade battle between the United States and China and China and India has produced attractive income pockets for trailer manufacturers. 

Segmental Analysis

Based on type, the market is divided into passenger vehicles and commercial vehicles. Passenger automobile production is slowing down over the world with each passing year. In 2018, 71.75 million passenger cars were manufactured, which fell to 67.14 million in 2019. North America was the most brutally hit by the pandemic. 

In 2018, the region produced approximately 50.22 million passenger cars, down from 47.56 million in 2017, a -13.3 % decrease. On the other hand, Europe manufactured 19.96 million passenger cars in 2018, which fell to 18.75 million in 2019 and about 23% in 2020. Similarly, Asia Pacific saw a 6.8% decrease in passenger car production in 2018 compared to 2019. 

The global trailer market is divided into four categories: Dry Van & Box, Refrigerator, Flatbed, and Others. The segment acquired ~43% of the market share in 2021, and it is expected to grow at a CAGR of 4.9% during the forecast period. The refrigerator segment acquired the second-largest market in 2021. It has pegged ~27% of the market share and is predicted to grow at a CAGR of 5.6% by 2029.

Impact of covid-19

After setting records in the transportation equipment markets in 2018 and 2019, truck-trailer manufacturers predicted a decrease in the industry in 2020. The world did not anticipate the pandemic, and the widespread shutdowns interrupted the supply chain and compelled employers to redesign operations to safeguard workers from COVID-19. As a result, the five-year streak in which the Top 25 trailer manufacturers produced more than 300,000 trailers ended in 2020. Despite the obstacles, trailer output exceeded 200,000 units for the tenth straight year in 2020. In July, the worldwide market took off quickly, and trailer manufacturing has begun to revive at an astonishing rate.

However, the producers had to deal with many other issues, including a slowdown. Manpower shortages, raw material shortages, increasing steel prices, and supply chain disruptions affected the market. On the plus side, most of the dealer inventory accumulated in 2018 and 2019 was used in 2020. Early 2021 business has been substantially more potent than the previous 18+ months. Most trailer manufacturers in the United States and Europe saw a considerable increase in backlog as demand increased but could not be met owing to labor and raw material shortages.

Regional Analysis

Significant growth in North America and Europe

The global road trailers market is divided into five regions: Asia Pacific, North America, Europe, Latin America, and the Middle East and Africa. Europe and North America are the two major markets for road trailers. 

Europe is the largest market for road trailers and is predicted to grow at a CAGR of 4.2% by 2029. Germany is Europe's top producer of passenger cars, commercial vehicles, and heavy-duty trailers. According to our findings, over 188,000 heavy-duty trailers were sold in the region in 2019, with Germany holding the most significant 18% share of the regional market, followed by the UK, Poland, France, and Spain, with approximately 25,000, 21,000, 20,000, and 15,000 trailers sold in 2016, respectively. This is primarily due to leading manufacturers, high demand for goods transportation, and significant movement of goods for import and export activities, among other factors.

In North America, the top 25 trailer manufacturers produced 211,807 trailers in 2020, a 34% decrease from the 322,341 units made in 2019. The four largest trailer producers, each constructed more than 50,000 trailers the previous year, each made fewer than 40,000 trailers in 2020, shipping a total of 159,489 trailers, or 66% of the Top 25 total. Tankers and bulk transport trailers account for a somewhat higher share of sales in the United States (10%) than in the EU (7%). Tippers and dump trailers are far more common in the EU (13%) than in the US (2%).

Recent Developments

• In November 2019, the UK and Ireland trailer manufacturer Dennison made its debut at the Solutrans CV Show in Lyon, France, exhibiting its new Link 25.25m trailer. New SAF axles and a patented Dennison design have enabled the turning circle to be reduced compared with the B-Double trailer it previously offered. The units were manufactured in Ireland for sale across Europe, where Dennison hoped to expand its sales reach.
• In March 2019, Big Tex Trailer World, the nation's largest professional-grade trailer retailer, announced the acquisition of Truckfitters, a premier provider of truck upfitting products and service and the largest operation in Texas. The addition of Truckfitters furthers Big Tex Trailer World's mission to provide the most complete and the highest quality hauling solutions anywhere.

Road Trailers Market Segmentation

By Type

• Passenger Vehicles
• Commercial Vehicles

By Trailer Type

• Dry Van and Box
• Refrigerator
• Flatbed
• Other

By Regions

• America
• Europe
• Asia-Pacific
• SAMEA