AMU: Commercial vehicle trends in aluminum

The disconnect stems from a growing divergence between unit-based demand signals and dollar-denominated reporting, further complicated by tariffs and inflation on input costs.

The challenge isn’t the lack of data, it’s parsing through the noise.

Trailers – Build rates hold, orders ‘trail’ off

U.S. trailer orders fell 34% month-over-month in May, dropping to just 6,738 units according to FTR Transportation Intelligence – a sharp decline that outpaces normal seasonal softness. The year-over-year figure, on the other hand, shows a comparatively modest 3% increase, but only against an unusually weak 2024 comparable figure.

Production, however, has held steadier. May trailer builds only declined by 4% to 16,958 units from April, suggesting manufacturers are still drawing down existing backlogs.

Those backlogs are shrinking fast.

The May decline of 11,376 units brought total trailer backlogs to 108,955 units, down 16% annually and representing just 6.4 months of production at current build rates.

Commercial vehicles – fleet expansion turns to fleet caution

Meanwhile, in June, preliminary North American Class 8 truck orders dropped to just 8,900 units, the weakest June figure since 2009. That’s a 25% drop from the prior month and a 36% drop from the prior year period.

With freight rates still under pressure and financing costs elevated, fleets are taking a step back from large capital outlays in the face of economic uncertainty. Major publicly-trade Class 8 manufacturers were already posting lower profits as well as lower North American unit sales in the first quarter, while raw material costs were comparable to Q1 2024.

Year-to-date, Class 8 orders are down 15%, reflecting a broader pullback in demand across on-highway applications. OEMs may still be operating off prior backlogs, but those appear to be tapering as well.

Preliminary net orders for North American 5-7 orders (what you think of when you hear “work truck”), trucks bigger than passenger cars but typically still on four wheels, fell 42% year-over-year to 11,900 units.

Vocational trucks are prevalent across a wide swath of end sectors, making it a fragmented market. Macroeconomic uncertainty typically suppresses small- to mid-sized businesses’ capital investments on repairs or other value-added, non-essential upgrades.

Impact on aluminum

Much of the build activity in the truck-trailer sector leans heavily on aluminum-intensive components.

Roughly two-thirds of aluminum used in trailer construction comes from extrusions, with the rest split between sheet and coil. Common alloys employed in trailer manufacture include 5052, 3003, 3105 for skin panels and roofing, also prevalent in commercial truck builds. Forged aluminum wheels are still a preferred lightweighting solution in the trucking industry, and high-strength 6XXX series flat-rolled and extrusions, particularly 6061, are used in floors and truck bodies.

The most recent data reflects the first nearly full month impacted by the 25% auto parts tariffs and the increase to 50% on unwrought and semi-fabricated aluminum imports, providing important context for the preliminary June Class 8 figures.

Value climbs as volumes fall

Despite clear signs of weakening demand in the truck-trailer end market, U.S. Census data for transportation equipment overall tell a more optimistic story, at least at first glance.

In May, new orders for transportation equipment reached a record $146 billion, up 4.8% month-over-month and 5.6% year-over-year. Unfilled orders also hit a record $898 billion, a 5.5% increase from April and 8.5% increase from a year earlier.

But these top-line figures are heavily skewed by high-dollar, low-volume segments such as aerospace. When looking specifically at the subcategory “motor vehicles and parts” under transportation equipment, the trend is less optimistic.

New orders rose just 0.5% from April and fell 2.6% from the prior year period and unfilled orders dropped 5.1% from May 2024. Inventories held flat on a monthly and annual basis.

A sizable portion of the uptick in new and unfilled orders in transportation equipment was the result of a more than 200% annual and monthly increase in commercial aerospace orders.

Taken together, this paints a clearer picture: Manufacturers in the motor vehicle subsector are working through backlogs faster than new demand is coming in, and there’s no sign of aggressive restocking or production ramp-ups.

The resilience in transportation equipment order values reflects more about inflation and sectoral shifts than it does about the core strength of commercial motor vehicle production.

Reading demand in reverse

The commercial vehicle market is softening: Backlogs are thinning, net orders are down, and buyers are cautious. Surface-level economic data, bloated by aerospace procurement and tariff-inflated component costs, continues to show strength.

Trailer manufacturing tends to have a more fragmented and localized footprint, whereas truck production is largely concentrated among a few major players with a large share of their manufacturing concentrated along the eastern seaboard and in the Midwest.

Aluminum remains structurally important in trailers and trucks, but if production schedules slow and fleets pause replacement cycles, downstream consumption will inevitably follow.

This piece was first published by SMU’s sister publication, Aluminum Market Update. To learn about AMU, visit their website, or sign up for a free trial.