US Tariffs Cast Shadow Over Trucking ABS Performance

Fitch Ratings has raised concerns about the impact of the United States' tariff policy on the performance of trucking equipment Asset-Backed Securities (ABS). The uncertainty surrounding these tariffs is creating waves in the financial stability of the trucking sector.

Stable Ratings Amidst Growing Challenges

Despite the anticipated deterioration in asset performance, Fitch Ratings maintains that trucking ABS ratings are stable. This stability is attributed to strong credit enhancement levels and transaction structures designed for quick deleveraging. The agency also highlighted that these ABS transactions are primarily composed of transportation assets, with some including related 'mid-ticket' assets like construction and manufacturing equipment.

Ongoing Pressures in the Trucking Sector

The trucking industry has been navigating through a series of challenges over the past three years. Fitch suggests that the sector will continue to face pressure this year, with US tariff policies adding another layer of complexity to the already challenging landscape of trucking and transportation.