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WABASH NATIONAL CORPORATION

FORM 10-K FOR THE FISCAL

YEAR ENDED DECEMBER 31, 2012

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FORWARD LOOKING STATEMENTS

This Annual Report of Wabash National Corporation (the “Company”, “Wabash” or “we”) contains “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”). Forward-looking statements may include the words “may,” “will,” “estimate,” “intend,” “continue,” “believe,” “expect,” “plan” or “anticipate” and other similar words. Our “forward-looking statements” include, but are not limited to, statements regarding:

Although we believe that the expectations expressed in our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and are subject to inherent risks and uncertainties, such as those disclosed in this Annual Report. Each forward-looking statement contained in this Annual Report reflects our management’s view only as of the date on which that forward-looking statement was made. We are not obligated to update forward-looking statements or publicly release the result of any revisions to them to reflect events or circumstances after the date of this Annual Report or to reflect the occurrence of unanticipated events, except as required by law.

Currently known risks and uncertainties that could cause actual results to differ materially from our expectations are described throughout this Annual Report, including in “Item 1A.Risk Factors.” We urge you to carefully review that section for a more complete discussion of the risks of an investment in our securities.

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PART I

ITEM 1 — 1—BUSINESS

Overview

Wabash National Corporation (“Wabash,” “Company,” “us,” “we,” or “our”) was founded in 1985 as a start-up company in Lafayette, Indiana. We are now one of North America’s leaders in designing, manufacturing and marketing standard and customized truck and tank trailers and related transportation equipment. We believe our position as a leader in our industry has been the result of our longstanding relationships with our core customers, our demonstrated ability to attract new customers, our broad and innovative product lines, our technological leadership and our extensive distribution and service network. Our management team is focused on continuing to optimize our manufacturing and retail operations to match the current demand environment, implementing cost savings initiatives and lean manufacturing techniques, strengthening our capital structure, developing innovative products that enable our customers to succeed, improving earnings and continuing diversification of the business into higher margin opportunities whichthat leverage our intellectual and process capabilities.

Wabash was incorporated in Delaware in 1991 and is the successor by merger to a Maryland corporation organized in 1985. Our internet website is www.wabashnational.com. We make our electronic filings with the Securities Exchange Commission (the “SEC”), including our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to these reports available on our website free of charge as soon as practicable after we file or furnish them with the SEC. Information on the website is not part of this Form 10-K.

Operating Segments

We manage our business in three segments: Commercial Trailer Products, Diversified Products and Retail. In the second quarter of 2012, we completed the acquisition of Walker Group Holdings (“Walker”), a manufacturer of liquid-transportation systems and engineered products significantly enhancing our Diversified Products segment. In the first quarter of 2013, we completed the acquisition of certain assets of the tank and trailer business of Beall Corporation (“Beall”), a manufacturer of aluminum tank trailers and related equipment based in Portland, Oregon, further adding to our Diversified Products segment. In the fourth quarter of 2012, six tank2014, our wood flooring production business that manufactures laminated hard wood oak products for our van trailer parts and service retail locations,business, which had been reported as part of the Diversified Products segment from the date of the Walker acquisition through the third quarter of 2012, began being reported2014, was reclassified to our Commercial Trailer Products segment due to a change in how that business is managed internally as partwe intend to drive improvements in the synergies between the two businesses. Financial performances for each of our Retail segmentreporting segments have been restated to match how these locations are managed internally and to be consistent with our focus to leverage operational and market synergies. We allocate certainreflect this realignment. Certain corporate related administrative costs, interest and income taxes toare not allocated and so are reported in our corporate and eliminations segment. Financial results by operating segment, including information about revenues from customers, measures of profit and loss total assets, and financial information regarding geographic areas and export sales are discussed in Note 14,13, Segments and Related Information, of the accompanying consolidated financial statements. By operating segment, net sales were as follows (dollars in millions):

		Year Ended December 31,
		2012				2011				2010
Sales by Segment
Commercial Trailer Products		$	1,063.3			$	1,071.3			$	561.3
Diversified Products			356.0				106.5				43.0
Retail			157.6				125.1				89.1
Corporate and Eliminations			(115.0	)			(115.7	)			(53.0	)
Total		$	1,461.9			$	1,187.2			$	640.4

		Year Ended December 31,
		2014				2013				2012
Sales by Segment
Commercial Trailer Products		$	1,294.2			$	1,082.4			$	1,064.6
Diversified Products			466.2				458.7				321.3
Retail			190.1				181.5				157.6
Corporate and Eliminations			(87.2	)			(86.9	)			(81.6	)
Total		$	1,863.3			$	1,635.7			$	1,461.9

Commercial Trailer Products

Commercial Trailer Products segment sales as a percentage of our consolidated net sales and gross margin measured prior to intersegment eliminations were:

		Years Ended December 31,
		2012				2011				2010
Percentage of net sales			67.4	%			82.2	%			80.9	%
Percentage of gross margin			42.4	%			57.8	%			55.2	%

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The Commercial Trailer Products segment manufactures standard and customized truck trailers. We seek to identify and produce proprietary custom products that offer exceptional value to customers with the potential to generate higher profit margin than standardized products. We believe that we have the engineering and manufacturing capability to produce these products efficiently. We introduced our proprietary composite product, DuraPlate®DuraPlate^®,in 1996 and have experienced widespread truck trailer industry acceptance. Since 2002, sales of our DuraPlate®DuraPlate^® trailers have represented approximately 92%94% of our total new dry van trailer sales. We are also a competitive producer of standardized sheet and post and refrigerated trailer products and we strive to become the low-cost producer of theseas well as other specialty products within our industry.including converter dollies. Through our Transcraft subsidiary we also manufacture steel and aluminum flatbed and dropdeck trailers. Through our Commercial Trailer Products segment, we also operate a wood flooring production facility that manufactures laminated hard wood oak products for our van trailer products.

We market our transportation equipment under the Wabash®Wabash^®, DuraPlate®DuraPlate^®, DuraPlateHD®DuraPlateHD^®, DuraPlate® XD-35®DuraPlate^®XD-35^®, FreightPro®FreightPro^®, ArcticLite®ArcticLite^®, RoadRailer®RoadRailer^®, Transcraft®Transcraft^®, Eagle®Eagle^®, Eagle II®II^®, D-Eagle® D-Eagle^®and Benson®Benson^® trademarks directly to customers, through independent dealers and through our Company-owned retail branch network. Historically, we have focused on our longstanding core customers representing many of the largest companies in the trucking industry, but have expanded this focus over the past several years to include numerous additional key accounts. Our relationships with our growing list of core customers have been central to our growth since inception. We have also actively pursued the diversification of our customer base by focusing onthrough our network of independent dealers. For our van business we utilize a total of 2426 independent dealers with approximately 62 locations throughout North America to market and distribute our trailers. We distribute our flatbed and dropdeck trailers through a network of 7377 independent dealers with approximately 116113 locations throughout North America. In addition, we maintain twoa used fleet sales centerscenter to focus on selling both large and small fleet trade packages to the wholesale market.

Diversified Products

Diversified Products segment sales as a percentage of our consolidated net sales and gross margin measured prior to intersegment eliminations were:

		Years Ended December 31,
		2012				2011				2010
Percentage of net sales			22.6	%			8.2	%			6.2	%
Percentage of gross margin			47.4	%			27.3	%			18.1	%

The Diversified Products segment focuses on our commitment to expand our customer base, diversify our product offerings, end markets and revenues and extend our market leadership by leveraging our intellectual property and technology, including our proprietary DuraPlate®DuraPlate^® panel technology, drawing on our core manufacturing expertise and making available products that are complementary to the truck and tank trailers and transportation equipment we offer. This segment includes a wide array of products and customer-specific solutions. Leveraging our intellectual property and technology and core manufacturing expertise into new applications and market sectors enables us to deliver greater value to our customers and shareholders.

Our DuraPlate®DuraPlate^® composite panel technology contains unique properties of strength and durability that can be utilized in numerous applications in addition to truck trailers. For example, in December 2008, we entered into a multi-year agreement to build and service all of PODS®¹ portable storage container requirements. Since adding portable storage containers to our portfolio Wabash CompositesThe Diversified Products segment has leveraged our DuraPlate® DuraPlate^®panel technology to develop additionalnumerous proprietary products, including a foldable portable storage container, the AeroSkirt^®and the AeroSkirt®AeroSkirt CX^TM, an aerodynamic solutionsolutions for over-the-road trailers that providesprovide approximately 6% improvement in fuel efficiency.efficiency, as well as other solutions designed to improve overall trailer aerodynamics and fuel economy, most notably the Ventix DRS^TM and AeroFin^TM. In addition, we utilize our DuraPlate®DuraPlate^® technology in the production of truck bodies, overhead doors and other industrial applications. These DuraPlate®DuraPlate^® composite products are sold to original equipment manufacturers and aftermarket customers. Through our Diversified Products segment, we also operate a wood flooring production facility that manufactures laminated hard wood oak products for the van trailer industry.

OnIn May 8, 2012, we added to our Diversified Products segment by completing the Walker acquisition. Walker is a leading manufacturer of liquid-transportation systems and engineered products based in New Lisbon, Wisconsin. The acquisition of Walker provided Wabash with diversification in products, end-markets, customers and geographies, while maintaining a focus on core manufacturing capabilities that the two companies share. Walker’s transportation products include brands such as Walker Transport, Garsite, Walker Defense Group, Progress Tank, Brenner^® Tank, TST^® and Bulk International. These brands represent leading positions in liquid transportation systems, including stainless steel liquid transportation systems and stainless steel liquid-tank trailers for the North American chemical, dairy, food and beverage, petroleum, aviation, energy services and waste hauling markets. Walker’s engineered products include brands such as Walker^® Engineered Products, Walker^®Barrier Systems and Extract Technology^®. These brands represent what we estimate to be leading positions in isolators, stationary silos and downflow booths around the world for the chemical, dairy, food and beverage, pharmaceutical and nuclear markets. In addition, in February 2013, we further added to our Diversified Products segment by completing, out of bankruptcy liquidation, the acquisition of certain assets of the tank and trailer business of Beall Corporation, a manufacturer of aluminum tank trailers and related equipment based in Portland, Oregon.

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Through these brands and product offerings, our Diversified Products segment now serves a variety of end markets a number of which we believe are less cyclical than other markets historically served by Wabash. We believe Walker’s diversified products base, end-markets and customers also present opportunities to grow sales of existing Wabash products. We expect to continue to focus on diversifying our Diversified Products segment to enhance our business model, strengthen our revenues and become a stronger company that can deliver greater value to our shareholders.

Retail

Retail segment sales as a percentage of our consolidated net sales and gross margin measured prior to intersegment eliminations were:

		Years Ended December 31,												Years Ended December 31,
		2012				2011				2010				2014				2013				2012
Percentage of net sales			10.0	%			9.6	%			12.9	%			9.7	%			10.5	%			10.2	%
Percentage of gross margin			10.2	%			14.9	%			26.7	%			9.1	%			9.5	%			10.2	%

The Retail segment includes our 1815 Company-owned retail branch locations, which are strategically located innear large metropolitan areas to provide additional opportunities to distribute our products, diversify our factory direct sales and also offer nationwide services and support capabilities for our customers. Six tank trailer parts and serviceIn May 2014, we entered into a definitive agreement with TEC Equipment, Inc. to transition three of our retail locations were addedin California and Oregon to independent dealer facilities. Additionally, this segment asincludes 9 on-site service locations, whereby we provide dedicated service on a result of the Walker acquisition.customer’s site in conjunction with long-term service and maintenance contracts. Our retail branch network’s sale of new and used trailers, aftermarket parts and service generally provides enhanced margin opportunities to our retail customers.

Strategy

We are committed to a corporate strategy that seeks to maximize shareholder value by executing on the core elements of our strategic plan:

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Industry and Competition

Trucking in the U.S., according to the American Trucking Association (ATA), was estimated to be a $604$682 billion industry in 2011,2013, representing approximately 81% of the total transportation industry revenue. Furthermore, ATA estimates that approximately 67%69% of all freight tonnage in 20112013 was carried by trucks at some point during its shipment.trucks. Trailer demand is a direct function of the amount of freight to be transported. As the economy improves, ATA estimates that the percentage of freight tonnage carried by trucks will grow to 70%71% by 2023.2025. To meet this expected increased in freight demand, truck carriers will need to expand and replace their fleets, which typically results in increased trailer orders.

Transportation in the U.S., including trucking, is a cyclical industry that has experienced three cycles over the last 20 years. In each of the last three cycles the decline in freight tonnage preceded the general U.S. economic downturn by approximately two and one-half years and the recovery has generally preceded that of the economy as a whole. The trailer industry generally follows the transportation industry, experiencing cycles in the early and late 90’s lasting approximately 58 and 67 months, respectively. Truck freight tonnage, according to ATA statistics, started declining year-over-year in 2006 and remained at depressed levels through 2009. The most recent cycle concluded in 2009, lasting a total of 89 months. After three consecutive years with total trailer demand well below normal replacement demand levels estimated to be between 175,000200,000 trailers and 200,000220,000 trailers, 2011 and 2012 werethe four year period ending December 2014 represent years of significant improvement in which the total trailer market increased year-over-year approximately 69%67%, 13%, 1% and 12%,15% for 2011, 2012, 2013 and 2014, respectively, with total shipments of approximately 213,000207,000; 234,000; 237,000 and 239,000,271,000, respectively. In our view, we expect to see continued improvement in the overallstrong demand for new trailer equipment as the economic and industry specific indicators we track, including but not limited to ATA’s truck tonnage index, total industrial production, employment growth, housing and auto sectors, as well as the overall gross domestic product, appear to be trending in a positive direction. In addition, pending legislation or regulatory reform efforts at the state and federal level could have a favorable impact on the demand for trailers in the near term, specifically comprehensive safety programs for carriers and drivers, as well as rule changes regarding hours of service restrictions.

Wabash, and its twothree largest competitors, Great Dane, Utility and Utility,Hyundai Translead, are generally viewed as the top three trailer manufacturers in the U.S. and have accounted for greater than 50% of U.S. new trailer market share in recent years, including approximately 56%68% in 2012.2014. Our market share of U.S. total trailer shipments in 20122014 was approximately 19%21%. Trailer manufacturers compete primarily through the quality of their products, customer relationships, service availability and cost.price. Over the past several years, we have seen a number of our competitors follow our leadership in the development and use of composite sidewalls that compete directly with our DuraPlate®DuraPlate^® products. Our product development is focused on maintaining our leading position with respect to these products and on development of new products and markets, leveraging our proprietary DuraPlate®DuraPlate^® product, as well as our expertise in the engineering and design of customized products.

The table below sets forth new trailer production for Wabash and, as provided by Trailer Body Builders Magazine, our largest competitors and the trailer industry as a whole within North America. The data represents all segments of the market, except containers and chassis. For the years included below, we have participated primarily in the van and platform trailer segments.segments and added the tank trailer segment beginning in 2012 with the acquisitions of Walker in May 2012 and certain assets of Beall Corporation in February 2013. Van trailer demand, the largest segment within the trailer industry, has continued to show sequential improvements over each of the last threefive years from a low of approximately 52,000 trailers in 2009 recovering to an estimated 163,000196,000 van trailers in 2012.2014. Our market share for van trailers in 20122014 was approximately 25%, a decreasean increase of approximately 5%2% from 2011 reflective of our efforts to recover material cost increases and recapture lost margins through improved pricing of van trailers.2013.

		2012				2011				2010				2009				2008
Wabash			45,000(2)				49,000				27,000				12,000				32,000
Great Dane			44,000				39,000				21,000				15,000				29,000
Utility			38,000				33,000				23,000				17,000				23,000
Hyundai Translead			23,000				18,000				8,000				5,000				7,000
Stoughton			11,000				9,000				5,000				3,000				5,000
Other principal producers			33,000				25,000				19,000				12,000				20,000
Total Industry			227,000				201,000	(1)			122,000	(1)			79,000	(1)			143,000	(1)

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Our diversified product initiatives are,segment, in most cases, participates in markets that are more fragmenteddifferent than our traditional trailer product offerings. The end markets that our diversified products serve are broader and more diverse than the trailer industry, including environmental, pharmaceutical, biotech, oil and gas, moving and storage and specialty vehicle. In addition, our diversification efforts pertain to new and emerging markets and many of the products are driven by regulatory requirements or, in most cases, customer-specific needs. However, manysome of our diversification efforts still remainare considered to be in the early growth stages and future success is largely dependent on continued customer adoption of our product solutions and general expansion of our customer base and distribution channels.

Competitive Strengths

We believe our core competitive strengths include:

We have been manufacturing DuraPlate®DuraPlate^® trailers for over 1719 years and through December 20122014 have sold over 470,000550,000 trailers. This proven experience, combined with ownership and knowledge of the DuraPlate®DuraPlate^® panel technology, helps ensure continued industry leadership in the future. We continue to introduce new innovations in our DuraPlate®DuraPlate^® family, including DuraPlateHD® DuraPlateHD^®and DuraPlate XD-35®XD-35^®, along with new innovations in other product lines, including our ArcticLite®ArcticLite^® refrigerated trailers and the FreightPro®FreightPro^® sheet and post trailer.

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Regulation

Truck trailer length, height, width, maximum weight capacity and other specifications are regulated by individual states. The federal government also regulates certain safety features incorporated in the design and use of truck and tank trailers. These regulations include, but are not limited to, requirements on anti-lock braking systems (ABS) and rear-impact guard standards, as well as operator restrictions as to hours of service and minimum driver safety standards (see “Industry Trends”). In addition, most tank trailers we manufacture have specific federal regulations and restrictions that dictate tank design, material type and thickness. Manufacturing operations are subject to environmental laws enforced by federal, state and local agencies (see “Environmental Matters”"Environmental Matters").

Products

Since our inception, we have expanded our product offerings from a single truck trailer dry van product to a broad range of transportation equipment.equipment and diversified industrial products.

Our Commercial Trailer Products segment specializes in the development of innovative proprietary products for our key markets. Commercial Trailer Products segment sales represented approximately 67%66%, 82%63% and 81%69% of our consolidated net sales as measured before elimination of intersegment sales in 2014, 2013 and 2012, 2011 and 2010, respectively. While this segment continues to account for approximately two-thirds of our consolidated net sales for 2012, the decrease in the percentage of net sales attributable to this segment highlights our strategic focus to expand our customer base and diversify our product offerings and revenues. Our current Commercial Trailer Products primarily include the following:

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Our Diversified Products segment focuses on our commitment to expand our customer base, diversify our product offerings and revenues and extend our market leadership by leveraging our proprietary DuraPlate®DuraPlate^® panel technology, drawing on our core manufacturing expertise and making available products that are complementary to the truck trailers and transportation equipment we offer. During 2012, we expanded ourOur Diversified Products segment by completing the acquisition of Walker.has expanded in recent years through strategic acquisitions. Diversified Products segment sales represented approximately 23%24%, 8%27% and 6%21% of our consolidated net sales as measured before elimination of intersegment sales in 2012, 20112014, 2013 and 2010,2012, respectively. Our current Diversified Products primarily include the following:

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Our Retail segment offers products in three general categories, including new trailers, used trailers and parts and service. Retail segment sales represented approximately 10%, 10% and 13% of our consolidated net sales as measured before elimination of intersegment sales in 2012, 2011 and 2010, respectively.each of the last three years. The following is a description of each product category:

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¹EPA Smartway^® is a registered trademark of U.S. Environmental Protection Agency (EPA)

Customers

Our customer base has historically included many of the nation’s largest truckload (TL) common carriers, leasing companies, private fleet carriers, less-than-truckload (LTL) common carriers and package carriers. According to Transport Topics, ourOur customer base includes approximately one-halftwo-thirds of the top fifty and more than one-thirdone-half of the top one hundred for-hire fleet operators in North America.America, according to Transport Topics. We continue to make improvements in expanding our customer base and diversifying into the broader trailer market through leveraging our independent dealer and company-owned retail networks, as well as through the acquisitions of Walker and Transcraft and the asset purchases of Beall and Benson.strategic acquisitions. Furthermore, we continue to diversify our products organically by expanding the use of DuraPlate®DuraPlate^® composite panel technology through products such as portable storage containers, DuraPlate® AeroSkirts®DuraPlate^® AeroSkirts^®, truck bodies and overhead doors as well as strategically through acquisitions like Walker and certain assets of Beall. The acquisition of certain assets of Beall has also expanded our tank trailer market geographically by providing for a tank trailer manufacturing operations in the Western half of the U.S.acquisitions. All of these efforts have been accomplished while maintaining our relationships with our core customers. Our five largest customers together accounted for approximately 23%20%, 32%17% and 32%23% of our aggregate net sales in 2014, 2013 and 2012, 2011 and 2010, respectively, with one differentrespectively. No individual customer representing approximately 13% andaccounted for more 10% or more of our aggregate net sales in each of 2011 and 2010, respectively. This decrease in our concentration of net sales is primarilyduring the result of our diversification efforts as well as our Walker acquisition.past three years. International sales, primarily to Canadian customers, accounted for less than 10% of net sales for each of the last three years.

We have established relationships as a supplier to many large customers in the transportation industry, including the following:

Through our Diversified Products segment we also sell our products to several other customers including, but not limited to: CanAm Equipment Solutions Inc.; GlaxoSmithKline Services Unlimited; Morgan Corporation; PODS Enterprises, Inc.; Poly-Coat Systems, Inc.; SabreSemo Tank/Baker Equipment Company; Southwest Airlines Company; Quality Carriers.; Utilimaster Corporation; Matlack Leasing LLC; International Equipment Logistics, Inc.; and Wabash Manufacturing, LLC; Supreme Corporation; and Utilimaster Corporation.Inc. (an unaffiliated company).

Marketing and Distribution

We market and distribute our products through the following channels:

Factory direct accounts are generally large fleets, with over 7,500 trailers, that are high volume purchasers. Historically, we have focused on the factory direct market in which customers are highly

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knowledgeable of the life-cycle costs of trailer equipment and, therefore, are best equipped to appreciate the design and value-added features of our products. We have also actively pursued, through our Company-owned and independent dealer network, the diversification of our customer base focusing on carriers that operate fleets of between 250 to 7,500 trailers, which we estimate account for approximately two million trailers in total.

Our Company-owned distribution network generates retail sales of trailers to smaller fleets and independent operators located in geographic regions where our branches are located. This branch network enables us to provide maintenance and other services to customers. The branch network and our used trailer centers provide an outlet to facilitate the resale of used trailers taken in trade upon the sale of new trailers, which is a common practice with fleet customers.

We also sell our van trailers through a network of 2426 independent dealers with approximately 62 locations throughout North America. Our platform trailers are sold through 9077 independent dealers with approximately 116113 locations throughout North America. Our tank trailers are distributed through a network of 3471 independent dealers and locations throughout North America. The dealers primarily serve mid-market and smaller sized carriers and private fleets in the geographic region where the dealer is located and occasionally may sell to large fleets. The dealers may also perform service work for our customers.

Raw Materials

We utilize a variety of raw materials and components including, specialty steel coil, stainless steel, plastic, aluminum, lumber, tires, landing gear, axles and suspensions, which we purchase from a limited number of suppliers. Costs of raw materials and component parts represented approximately 69%67%, 77%66% and 74%69% of our consolidated net sales in 2014, 2013 and 2012, 2011 and 2010, respectively. DecreasesRaw material costs as a percentage of our consolidated net sales realized throughout 20122014 are attributedin line with recent years as raw material, commodity and component costs have remained relatively consistent as compared to our concerted efforts to raise price and recover lost margins as well as an increased percentage of sales through our higher margin Diversified Products segment.recent years. Significant price fluctuations or shortages in raw materials or finished components has had, and could have further, adverse effects on our results of operations. In 20132015 and for the foreseeable future, we expect that the raw materials used in the greatest quantity will be steel, aluminum, plastic and wood. For 2013, we expect thereWe will endeavor to be continued price volatility for some of our primarypass along any raw materialsmaterial and component parts, including, among others, aluminum, steel, plasticcost increases and, tires. Our Harrison, Arkansas laminated hardwood floor facility providesto minimize the majorityeffect of price fluctuations, we hedge certain commodities which have the potential to significantly impact our requirements for the flooring of our dry van trailers and has adequate capacity to meet our needs throughout 2013.operations.

Backlog

Orders that have been confirmed by customers in writing, have defined delivery timeframes and can be produced during the next 18 months are included in our backlog. Orders that comprise our backlog may be subject to changes in quantities, delivery, specifications, terms or cancellation. Our backlog of orders at December 31, 20122014 and 2011 were2013 was approximately $666$1,087 million including $147 million related to Walker, and $587$711 million, respectively. We expect to complete the majority of our existing backlog orders within the next 12 months.

Patents and Intellectual Property

We hold or have applied for 7993 patents in the U.S. on various components and techniques utilized in our manufacture of transportation equipment and engineered products. In addition, we hold or have applied for 100111 patents in foreign countries.

Our patents include intellectual property related to the manufacture of trailers using our proprietary DuraPlate®DuraPlate^® product, which we believe offers us a significant competitive advantage, and our containment and isolation systems, as well as other engineered products. TheOur DuraPlate^®patent portfolio includes several patents and pending patent applications, which cover not only utilization of our DuraPlate^® product in the manufacture of trailers, but also cover a number of aerodynamic-related products aimed at increasing the fuel efficiency of trailers. Patents in our DuraPlate®DuraPlate^® patent portfolio have expiration dates ranging from 2016 to 2029. We2030 with certain patents relating to the use of DuraPlate^® panels within the sidewall of our dry van trailers expiring in 2016. However, we also believe that our proprietary DuraPlate®DuraPlate^® production process, which has been developed and refined since 1995, offers us a significant competitive advantage in the industry.industry – above and beyond the benefits provided by patent protection concerning the use and/or design of our DuraPlate^® products. While unpatented, we believe the proprietary knowledge of thethis process and the significant intellectual and capital hurdles in creating a similar production process providesprovide us with an advantage over others in the industry who utilize composite panel technology. The

In addition, our intellectual property portfolio includes patents inand patent applications covering many of our engineered products, portfolioincluding our containment and isolation systems, as well as many trailer industry components. These products have become highly desirable and are recognized for their innovation in the markets we serve. The engineered products patents and patent applications relate to our industry leading isolation systems, sold under the Walker Barrier Systems and Extract Technologies^® businesses. These patents have expiration dates ranging from 2015 to 2022. In addition, we have applied2030. The patents and patent applications relating to our proprietary trailer-industry componentry include, for or been granted, patentsexample, those covering the Trust Lock Plus^® door locking mechanism, the Max Clearance^® Overhead Door System, which provides additional overhead clearance when an overhead-style rear door is in the U.S.opened position that would be comparable to that of swing-door models, the use of bonded intermediate logistics strips, the bonded D-ring hold-down device, bonded skylights, and foreign countries relating to innovative product designs or design improvements,the DuraPlate^® arched roof. The patents covering these products will not expire before 2029. Additionally, several patented products sold by the Diversified Products segment, including products like the ShakerTank^® trailer, a vibrating bulk tank trailer used in transporting viscous materials, will not expire before 2026. We believe all of these proprietary products offer us a competitive market advantage in the industries in which were first developed by Wabash or its subsidiaries and have become highly desirable in our industry. In our view there are no meaningful patents having an expiration date prior to 2016.

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We also hold or have applied for 4244 trademarks in the U.S. as well as 5054 trademarks in foreign countries. These trademarks include the Wabash®Wabash^®, Wabash National®National^®, Transcraft®Transcraft^®, Benson®Benson^®, Walker® Transport, Walker® Stainless Equipment, Walker® Engineered Products, TST®TST^®, Walker® Barrier Systems, Extract Technologies®Technologies^{®, Beall®} Beall^® and Brenner®Brenner^® brand names as well as trademarks associated with our proprietary products such as DuraPlate®DuraPlate^®, RoadRailer®RoadRailer^®, Eagle®Transcraft Eagle^®, Arctic Lite^®, and Benson®Benson^® trailers. Additionally, we utilize several tradenames that are each well-recognized in their industries, including Walker Transport, Walker Stainless Equipment, Walker Engineered Products, Walker Barrier Systems, Garsite, Bulk Tank International and Progress Tank. Our trademarks associated with additional proprietary products include Max Clearance^® Overhead Door System, Trust Lock Plus^®, EZ-7^®, DuraPlate Aeroskirt^®, DuraPlate Aeroskirt CX^TM, DuraPlate XD-35^®, DuraPlate HD^®, SolarGuard^®, Ventix DRS^TM, AeroFin^TM and EZ-Adjust^®. We believe these trademarks are important for the identification of our products and the associated customer goodwill; however, our business is not materially dependent on such trademarks.

Research and Development

Research and development expenses are charged to earnings as incurred and were $1.7 million, $1.0$2.2 million and $0.9$1.7 million in 2014, 2013 and 2012, 2011 and 2010, respectively.

Environmental Matters

Our facilities are subject to various environmental laws and regulations, including those relating to air emissions, wastewater discharges, the handling and disposal of solid and hazardous wastes and occupational safety and health. Our operations and facilities have been, and in the future may become, the subject of enforcement actions or proceedings for non-compliance with such laws or for remediation of company-related releases of substances into the environment. Resolution of such matters with regulators can result in commitments to compliance abatement or remediation programs and in some cases the payment of penalties (see Item 3 “Legal Proceedings”).

We believe that our facilities are in substantial compliance with applicable environmental laws and regulations. Our facilities have incurred, and will continue to incur, capital and operating expenditures and other costs in complying with these laws and regulations. However, we currently do not anticipate that the future costs of environmental compliance will have a material adverse effect on our business, financial condition or results of operations.

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Employees

As of December 31, 20122014 and 2011,2013, we had approximately 4,4005,100 and 2,6004,800 full-time associates, respectively. This 69.2% year-over-year increase is primarily due to the addition of approximately 1,400 full time associates as a result of the Walker acquisition. Throughout 2012,2014, essentially all of our active associates were non-union. Our temporary associates represented approximately 24%18% of our overall production workforce as of December 31, 20122014 as compared to approximately 50% as20% at the end of the prior year period. We place a strong emphasis on maintaining good employee relations byand development through competitive compensation and related benefits, a safe work environment and promoting educational programs and quality improvement teams.

Executive Officers of Wabash National Corporation

The following are the executive officers of the Company:

Name		Age
Name		Age		Position
Richard J. Giromini		5961		President and Chief Executive Officer, Director
Rodney P. Ehrlich		6668		Senior Vice President – Chief Technology Officer
Bruce N. Ewald		6163		Senior Vice President – Sales and Marketing
Timothy J. MonahanWilliam D. Pitchford		60		Senior Vice President – Human Resources and Assistant Secretary
Erin J. Roth		3739		Senior Vice President – General Counsel and Secretary
Mark J. WeberJeffery L. Taylor		4149		Senior Vice President – Chief Financial Officer
Mark J. Weber		43		Senior Vice President – Group President, Diversified Products Group
Brent L. Yeagy		44		Senior Vice President – Group President, Commercial Trailer Products

Richard J. Giromini.Mr. Giromini was promoted to President and Chief Executive Officer onin January 1, 2007. He had been Executive Vice President and Chief Operating Officer from February 28, 2005 until December 2005 when he was appointed President and a Director of the Company. Prior to that, he had been Senior Vice President –- Chief Operating Officer since joining the Company onin July 15, 2002. Mr. Giromini was with Accuride Corporation from April 1998 to July 2002, where he served in capacities as Senior Vice President –- Technology and Continuous Improvement; Senior Vice President and General Manager –- Light Vehicle Operations; and President and CEO of AKW LP. Previously, Mr. Giromini was employed by ITT Automotive, Inc. from 1996 to 1998 serving as the Director of Manufacturing. Mr. Giromini

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also serves on the board of directors of Robbins & Myers, Inc., a global supplier of highly engineered equipment and systems for critical applications in energy, industrial, chemical and pharmaceutical markets, which he joined in October 2008. Mr. Giromini holds a Bachelor of Science degree in mechanical and industrial engineering and a Master of Science degree in industrial management, both from Clarkson University. He is a graduate of the Advanced Management Program at the Duke University Fuqua School of Management.

Rodney P. Ehrlich. Mr. Ehrlich has been Senior Vice President – Chief Technology Officer of the Company since January 2004. From 2001 to 2003, Mr. Ehrlich was Senior Vice President of Product Development. Mr. Ehrlich has been in charge of the Company's engineering operations since the Company's founding. Prior to Wabash National, Mr. Ehrlich started with Monon Trailer Corporation in 1963 working various positions until becoming Chief Engineer in 1973, Director of Engineering in 1978, and serving until joining the founders of Wabash National in 1985. Mr. Ehrlich has obtained over 60 patents in trailer related design during his more than 50 year career in the trailer manufacturing business. Mr. Ehrlich holds a Bachelor of Science degree in Mechanical Engineering from Purdue University.

Bruce N. Ewald. Mr. Ewald’s original appointment was Vice President and General Manager of Wabash National Trailer Centers, Inc. when he joined the Company in March 2005. In October 2005, he was promoted to Senior Vice President – Sales and Marketing. Mr. Ewald has more than 30 years of experience in the transportation industry. Most recently, Mr. Ewald was with PACCAR from 1991 to February 2005 where he served in a number of executive-level positions. Prior to PACCAR, Mr. Ewald spent 10 years with Genuine Parts Co. where he served in several positions, including President and General Manager, Napa Auto Parts/Genuine Parts Co. Mr. Ewald holds a Bachelor of Science degree in Business from the University of Minnesota.

Timothy J. Monahan.William D. Pitchford. Mr. Monahan has beenPitchford was promoted to Senior Vice President – Human Resources since joiningand Assistant Secretary in June 2013. He joined the Company in October 2003. In addition, he also oversees the Company’s Information Technology group. Prior to Wabash, Mr. Monahan was with Textron Fastening Systems from 1999 to October 2003 where he servedDecember 2011 as Vice President – Human Resources forwith an extensive Human Resource background including executive leadership and management, training and development, employee relations, compensation planning and organizational design. Prior to joining the Commercial Solutions Group and later GlobalCompany, Mr. Pitchford served as Vice President –- Human Resources. Previously, Mr. Monahan servedResources for Rio Tinto Alcan Corporation in Chicago, Illinois, from January 2009 to December 2010 and was with Ford Motor Company for more than 30 years where he held a variety of key executive roles at Beloit Corporation, Ingersoll Cutting Tools and Regal Beloit Corporation,leadership positions including Vice President – Human Resources at both Beloit’s Mill ProDirector, Labor Relations Director and Paper Machinery Groups.Senior Human Resources Manager. Mr. Monahan serves on the board of directors of Global Specialty Solutions, a global producer of special cutting tools and tooling solutions. HePitchford holds a BachelorMaster of Arts degree in Personnel Management from Central Michigan and a Bachelors of Science degree from Milton College and has attended several executive management programs, including the Duke University Fuqua School of Management where he completed the Advanced Executive Management Program.Indiana State University.

Erin J. Roth.Roth. Effective January 1, 2011, Ms. Roth was promoted to the position of Senior Vice President – General Counsel and Secretary, following her appointment onin March 1, 2010 to the position of Vice President – General Counsel and Secretary. Ms. Roth joined the Company in March 2007 as Corporate Counsel and was promoted in July 2009 to Senior Corporate Counsel. For the five years prior to joining the Company, Ms. Roth was engaged in the private practice of law with Barnes & Thornburg, LLP, representing a number of private and public companies throughout the U.S. Ms. Roth earned her Bachelor of Science degree in Accounting from Butler University and her Juris Doctorate from the Georgetown University Law Center.

Jeffery L. Taylor. Mr. Taylor was appointed Senior Vice President and Chief Financial Officer in January 2014. Mr. Taylor joined the company in July 2012 as Vice President of Finance and Investor Relations and was promoted to Vice President – Acting Chief Financial Officer and Treasurer in June 2013. Prior to joining the Company, Mr. Taylor was with King Pharmaceuticals, Inc. from May 2006 to July 2011 as Vice President, Finance – Technical Operations, and with Eastman Chemical Company from June 1997 to May 2006 where he served in various positions of increasing responsibility within finance, accounting, investor relations and business management, including its Global Business Controller – Coatings, Adhesives, Specialty Polymers & Inks. Mr. Taylor earned his Bachelor of Science in Chemical Engineering from Arizona State University and his Masters of Business Administration from the University of Texas at Austin.

Mark J. Weber. Mr. Weber was promotedappointed to Senior Vice President – Chief Financial Officer on August 31, 2009.- Group President of Diversified Products Group in June 2013. Mr. Weber joined the Company in August 2005 as Director of Internal Audit, was promoted in February 2007 to Director of Finance, and in November 2007 he was promoted to Vice President and Corporate Controller. In August 2009 Mr. Weber was then appointed to the position of Senior Vice President – Chief Financial Officer. Prior to joining the Company, Mr. Weber was with Great Lakes Chemical Corporation from October 1995 through August 2005 where he served in several positions of increasing responsibility within accounting and finance, including Vice President of Finance. Mr. Weber earned his Masters of Business Administration and Bachelor of Science in Accounting from Purdue University’s Krannert School of Management.

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Brent L. Yeagy. Mr. Yeagy was appointed to Senior Vice President – Group President of Commercial Trailer Products Group in June 2013. He had been Vice President and General Manager for the Commercial Trailer Products Group since January 2010. Prior to that, he had been Vice President of Van Manufacturing since 2007. Mr. Yeagy has held numerous operations related roles since joining Wabash National in February 2003. Prior to joining the Company, Mr. Yeagy held various roles within Human Resources, Environmental Engineering and Safety Management for Delco Remy International from July 1999 through February 2003. Mr. Yeagy served in various Plant Engineering roles at Rexnord Corporation from December 1995 through July 1997. Mr. Yeagy is a veteran of the United States Navy, serving from 1991-1994. He received his Master degree in Business (MBA) from Anderson University and his Master and Bachelor degrees in Science from Purdue University. He is a graduate of the University of Michigan, Ross School of Business Program in Executive Management and the Stanford Executive Program.

ITEM 1A — 1A—RISK FACTORS

You should carefully consider the risks described below in addition to other information contained or incorporated by reference in this Annual Report before investing in our securities. Realization of any of the following risks could have a material adverse effect on our business, financial condition, cash flows and results of operations.

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Risks Related to Our Business, Strategy and Operations

Our business is highly cyclical, which has had, and could have further, adverse effects on our sales and results of operations.

The truck trailer manufacturing industry historically has been and is expected to continue to be cyclical, as well as affected by overall economic conditions. Customers historically have replaced trailers in cycles that run from five to 12 years, depending on service and trailer type. Poor economic conditions can adversely affect demand for new trailers and have historically, and has currently, led to an overall aging of trailer fleets beyond thisa typical replacement cycle. Customers’ buying patterns can also reflectbe influenced by regulatory changes, such as federal hours-of-service rules as well as overall truck safety and federal emissions standards.

The steps we have taken to diversify our product offerings through the implementation of our strategic plan do not insulate us from this cyclicality. During downturns, we operate with a lower level of backlog and have had to temporarily slow down or halt production at some or all of our facilities, including extending normal shut down periods and reducing salaried headcount levels. An economic downturn may reduce, and in the past has reduced, demand for trailers, resulting in lower sales volumes, lower prices and decreased profits or losses.

Demand for new trailers has been and will continue to be sensitive to economic conditions over which we have no control and that may further adversely affect our revenues and profitability.

Demand for trailers is sensitive to changes in economic conditions such as the level of employment, consumer confidence, consumer income, new housing starts, government regulations and the availability of financing and interest rates. The status of these economic conditions periodically have an adverse effect on truck freight and the demand for and the pricing of our trailers, and have also resulted in, and could continue to result in, the inability of customers to meet their contractual terms or payment obligations, which could further cause our operating revenues and profits to decline.

We may not be able to execute on our long-term strategic plan and growth initiatives, or meet our long-term financial goals.

Our long-term strategic plan is intended to generate long-term value for our shareholders by transforming Wabash National into a diversified industrial manufacturer while delivering profitable growth through all our business segments.  The long-term financial goals that we expect to achieve as a result of our long-term strategic plan and organic growth initiatives are based on certain assumptions, which may prove to be incorrect. We cannot provide any assurance that we will be able to fully execute on our strategic plan or growth initiatives, which are subject to a variety of risks, including, but not limited to, our ability to: diversify the product offerings of our non-trailer businesses; leverage acquired businesses and assets to grow sales with our existing products; design and develop new products to meet the needs of our customers; increase the pricing of our products and services to offset cost increases and expand gross margins; and execute potential future acquisitions, mergers, and other business development opportunities. If we are unable to successfully execute on our strategic plan, we may experience increased competition, adverse financial consequences and a decrease in the value of our stock. Additionally, our management’s attention to the implementation of the strategic plan may distract them from implementing our core business which may also have adverse financial consequences.

We have a limited number of suppliers of raw materials and components; increases in the price of raw materials or the inability to obtain raw materials could adversely affect our results of operations.

We currently rely on a limited number of suppliers for certain key components and raw materials in the manufacturing of our products, such as tires, landing gear, axles, suspensions and specialty steel coil used in DuraPlate®DuraPlate^® panels. From time to time, there have been and may in the future be shortages of supplies of raw materials or components, or our suppliers may place us on allocation, which would have an adverse impact on our ability to meet demand for our products. Shortages and allocations may result in inefficient operations and a build-up of inventory, which can negatively affect our working capital position. In addition, price volatility in commodities we purchase which impact the pricing of raw materials could continue to have negative impacts toon our operating margins. The loss of any of our suppliers or their inability to meet our price, quality, quantity and delivery requirements could have a significant adverse impact on our results of operations.

Our results of operations declined significantly in recent periods and have only recently begun a recovery, and the impact of the current global

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Global economic weakness and its effects on our industry could continue to harmnegatively impact our operations and financial performance.

The global economic downturn beginning in 2007 and continuing through 2010 caused demand for new trailers during this period to decline and led to, in some cases, the cyclical timeframe for trailer replacement to be delayed due to economic pressures. However, we believe that

While the trailer industry is currently experiencinghas recently experienced a period of economic recovery. The demand environment for trailers has improved in each of the last three years and we believe the strong demand market will continue for the next several years. For example, according to a January 2013 report by ACT Research Company (“ACT”), total trailer industry

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shipments for 2012 were approximately 239,000 trailers, representing an increase of approximately 12% from 2011. In addition, ACT is estimating 2013 trailer volumes to be approximately 255,000 trailers, representing an increase of approximately 7% from 2012 with continued strong demand levels through 2017 with estimated annual demand in excess of 220,000 trailers throughout the next five years. By comparison, total trailer industry shipments for 2008, 2009 and 2010 were approximately 143,000 trailers, 79,000 trailers, and 126,000 trailers, respectively, which were all well below normal industry replacement demand levels estimated to be between 175,000 trailers and 200,000 trailers.

However, even with the forecasted recovery, within the trailer manufacturing industry, we cannot makeprovide any assurances that we will be profitable in future periods or that we will be able to sustain or increase profitability in the future. Increasing our profitability will depend on several factors, including, but not limited to, our ability to increase our overall trailer volumes, improve our gross margins, gain continued momentum on our product diversification efforts and manage our expenses. If we are unable to generate profitability in the future, we may not be able to meet our payment and other obligations under our outstanding debt agreements.

We continue to be affected byreliant on the credit, markets, as well as the decline in the housing and construction-related markets in the U.S. The same general economic concerns faced by us are also faced by our customers. We believe that some of our customers are highly leveraged, have limited access to capital, and their continued existence may be reliant on liquidity from global credit markets and other sources of external financing. If the current conditions impacting the credit markets and general economy are prolonged, we may be faced with unexpected delays in product purchases or the loss of customers, which could further materially impact our financial position, results of operations and cash flow. Further, lackLack of liquidity by our customers could impact our ability to collect amounts owed to us. While we have taken steps to address these concerns through the implementation of our strategic plan, we are not immune to the pressures being faced by our industry or the global economy, and our results of operations may decline.

Our ability to fund operations is limited by our cash on hand and available borrowing capacity under our revolving credit facility.

We believe our liquidity, defined as cash on hand and available borrowing capacity, on December 31, 2012 of $224.3 million and our expected continued improvements in profitability will be more than adequate to fund working capital requirements and capital expenditures throughout 2013, which we expect to be a period of continued strong demand within the trailer manufacturing industry. Furthermore, we continue to have the option, subject to certain conditions, to request an additional incremental increase to the total commitment of our revolving credit facility of $50 million. Our liquidity position represented an increase of $98.6 million from December 31, 2011, which is reflective of the challenges we have had in recent years maintaining a strong liquidity position. Our ability to fund our working capital needs and capital expenditures is limited by the net cash provided by operations, cash on hand and available borrowings under our revolving credit facility. Declines in net cash provided by operations, increases in working capital requirements necessitated by an increased demand for our products and services, further decreases in the availability under the revolving credit facility or changes in the credit our suppliers provide to us, could rapidly exhaust our liquidity.

A change in our customer relationships or in the financial condition of our customers has had, and could have further, adverse effects on our business.

We have longstanding relationships with a number of large customers to whom we supply our products. We do not have long-term agreements with these customers. Our success is dependent, to a significant extent, upon the continued strength of these relationships and the growth of our core customers. We often are unable to predict the level of demand for our products from these customers, or the timing of their orders. In addition, the same economic conditions that adversely affect us also often adversely affect our customers. In recent years, the demand environment has caused us to experience reduced demand. As some of our customers are highly leveraged and have limited access to capital, their continued existence may be uncertain. Furthermore, we are subject to a concentration of risk as the five largest customers together accounted for approximately 23%20% of our aggregate net sales and in recent years there have been customers historically who have individually accounted

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individually for greater than 10% of our aggregate net sales. The loss of a significant customer or unexpected delays in product purchases could further adversely affect our business and results of operations.

Our backlog is not necessarily indicative of the level of our future revenues.

Our backlog represents future production for which we have written orders from our customers that can be produced or sold in the next 18 months. Orders that comprise our backlog may be subject to changes in quantities, delivery, specifications and terms, or cancellation, and our reported backlog may not be converted to revenue in any particular period and actual revenue from such orders may not equal our backlog revenues.backlog. Therefore, our backlog is not necessarily indicative of the level of our future revenues. Order cancellations within

International operations are subject to increased risks, which could harm our business, operating results and financial condition.

Our ability to manage our business and conduct operations internationally requires considerable management attention and resources and is subject to a number of risks, including the trailer industry, accordingfollowing:

potentially adverse tax consequences;

higher costs associated with doing business internationally;

different expectations regarding working hours, work culture and work-related benefits; and

different employee/employer relationships and the existence of workers’ councils and labor unions.

Compliance with complex foreign and U.S. laws and regulations that apply to international operations may increase our cost of doing business and could expose us or our employees to fines, penalties and other liabilities. These numerous and sometimes conflicting laws and regulations include import and export requirements, content requirements, trade restrictions, tax laws, environmental laws and regulations, sanctions, internal and disclosure control rules, data privacy requirements, labor relations laws, U.S. laws such as the Foreign Corrupt Practices Act and substantially equivalent local laws prohibiting corrupt payments to governmental officials and/or other foreign persons. Although we have policies and procedures designed to ensure compliance with these laws and regulations, there can be no assurance that our officers, employees, contractors or agents will not violate our policies. Any violation of the laws and regulations that apply to our operations and properties could result in, among other consequences, fines, environmental and other liabilities, criminal sanctions against us, our officers or our employees, prohibitions on our ability to offer our products and services to one or more countries and could also materially damage our reputation, our brand, our efforts to diversify our business, our ability to attract and retain employees, our business and our operating results.

Our technology and products may not achieve market acceptance or competing products could gain market share, which could adversely affect our competitive position.

We continue to optimize and expand our product offerings to meet our customer needs through our established brands, such as DuraPlate®DuraPlate^®, DuraPlateHD®DuraPlateHD^®, DuraPlate® XD-35®DuraPlate^® XD-35^®, DuraPlate Aeroskirt®Aeroskirt^®, FreightPro®FreightPro^®, ArcticLite®ArcticLite^®, Transcraft®Transcraft^®, Eagle®Eagle^®, Benson®Benson^®, Walker®Walker Stainless Equipment, Brenner®Brenner^® Tank, Garsite, Progress Tank, TST®TST^®, Bulk Tank International,^TM, and Extract Technology®Technology^®. While we target product development to meet customer needs, there is no assurance that our product development efforts will be embraced and that we will meet our sales projections. Companies in the truck transportation industry, a very fluid industry in which our customers primarily operate, make frequent changes to maximize their operations and profits.

Over the past several years, we have seen a number of our competitors follow our leadership in the development and use of composite sidewalls that bring them into direct competition with our DuraPlate®DuraPlate^® products. Our product development is focused on maintaining our leadership onfor these products but competitive pressures may erode our market share or margins. We hold patents on various components and techniques utilized in our manufacturing of transportation equipment and engineered products with expiration dates ranging from 2015 to 2030. We continue to take steps to protect our proprietary rights in our products.products and the processes used to produce them. However, the steps we have taken to protect them may not be sufficient or may not be enforced by a court of law. If we are unable to protect our intellectual properties, other parties may attempt to copy or otherwise obtain or use our products or technology. If competitors are able to use our technology, our ability to effectively compete could be harmed. In addition, litigation related to intellectual property could result in substantial costs and efforts which may not result in a successful outcome.

Disruption of our manufacturing operations would have an adverse effect on our financial condition and results of operations.

We manufacture our van trailer products at two van trailer facilities in Lafayette, Indiana, a flatbed and dump-body trailer facility in Cadiz, Kentucky, a hardwood floor facility in Harrison, Arkansas, fivesix liquid-transportation systems facilities in New Lisbon, Wisconsin; Fond du Lac, Wisconsin; Kansas City, Missouri; Kansas City, Kansas; Portland, Oregon; and Queretaro, Mexico and three engineered products facilities in New Lisbon, Wisconsin; Elroy, Wisconsin; and Huddersfield, United Kingdom. An unexpected disruption in our production at any of these facilities for any length of time would have an adverse effect on our business, financial condition and results of operations.

The inability to attract and retain key personnel could adversely affect our results of operations.

Our ability to operate our business and implement our strategies depends, in part, on the efforts of our executive officers and other key employees. Our future success depends, in large part, on our ability to attract and retain qualified personnel, including manufacturing personnel, sales professionals and engineers. The unexpected loss of services of any of our key personnel or the failure to attract or retain other qualified personnel could have a material adverse effect on the operation of our business.

We rely significantly on information technology to support our operations and if we are unable to protect against service interruptions or security breaches, our business could be adversely impacted.

We depend on a number of information technologies to integrate departments and functions, to enhance the ability to service customers, to improve our control environment and to manage our cost reduction

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initiatives. We have put in place a number of systems, processes, and practices designed to protect against the failure of our systems, as well as the misappropriation, exposure or corruption of the information stored thereon. Unintentional service disruptions or intentional actions such as intellectual property theft, cyber-attacks, unauthorized access or malicious software, may lead to such misappropriation, exposure or corruption if our protective measures prove to be inadequate. Any issues involving these critical business applications and infrastructure may adversely impact our ability to manage operations and the customers we serve. We could also encounter violations of applicable law or reputational damage from the disclosure of confidential business, customer, or employee information or the failure to protect the privacy rights of our employees in their personal identifying information. In addition, the disclosure of non-public information could lead to the loss of our intellectual property and diminished competitive advantages. Should any of the foregoing events occur, we may be required to incur significant costs to protect against damage caused by these disruptions or security breaches in the future.

Significant competition in the industryindustries in which we operate may result in our competitors offering new or better products and services or lower prices, which could result in a loss of customers and a decrease in our revenues.

The truck and tank trailer manufacturing industry isindustries in which we participate are highly competitive. We compete with other manufacturers of varying sizes, some of which have substantial financial resources. Trailer manufacturers compete primarily on the quality of their products, customer relationships, service availability and cost.price. Barriers to entry in the standard truck trailer manufacturing industry are low. As a result, it is possible that additional competitors could enter the market at any time. In the recent past, manufacturing over-capacity and high leverage of some of our competitors, along with bankruptcies and financial stresses that affected the industry, contributed to significant pricing pressures.

If we are unable to successfully compete with other trailer manufacturers, we could lose customers and our revenues may decline. In addition, competitive pressures in the industry may affect the market prices of our new and used equipment, which, in turn, may adversely affect our sales margins and results of operations.

We are subject to extensive governmental laws and regulations, and our costs related to compliance with, or our failure to comply with, existing or future laws and regulations could adversely affect our business and results of operations.

The length, height, width, maximum weight capacity and other specifications of truck and tank trailers are regulated by individual states. The federal government also regulates certain trailer safety features, such as lamps, reflective devices, tires, air-brake systems and rear-impact guards. In addition, most tank trailers we manufacture have specific federal regulations and restrictions that dictate tank design, material type and thickness. Changes or anticipation of changes in these regulations can have a material impact on our financial results, as our customers may defer purchasing decisions and we may have to re-engineer products. We are subject to various environmental laws and regulations dealing with the transportation, storage, presence, use, disposal and handling of hazardous materials, discharge of storm water and underground fuel storage tanks and may be subject to liability associated with operations of prior owners of acquired property. In addition, we are subject to laws and regulations relating to the employment of our associates and labor-related practices.

If we are found to be in violation of applicable laws or regulations in the future, it could have an adverse effect on our business, financial condition and results of operations. Our costs of complying with these or any other current or future regulations may be material. In addition, if we fail to comply with existing or future laws and regulations, we may be subject to governmental or judicial fines or sanctions.

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New regulations related to conflict-free minerals may force us to incur additional expenses and otherwise adversely affect our business and results of operations.

In August 2012, as

As mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Securities and Exchange Commission adopted rules regarding disclosure of the use of certain minerals, known as conflict minerals, originating from the Democratic Republic of Congo or adjoining countries. These new requirements will require ongoing due diligence efforts, with initial disclosure requirements beginningmade in May 2014. We may incur significant costs to determine the source of any such minerals used in our products. We may also incur costs with respect to potential changes to products, processes or sources of supply as a

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consequence of our diligence activities. Further, the implementation of these rules and their effect on customer and/or supplier behavior could adversely affect the sourcing, supply and pricing of materials used in our products, as the number of suppliers offering conflict-free minerals could be limited. We may incur additional costs or face regulatory scrutiny if we determine that some of our products contain materials not determined to be conflict-free or if we are unable to sufficiently verify the origins of all conflict minerals used in our products. Accordingly, the implementation of these rules could have a material adverse effect on our business, results of operations and/or financial condition.

Product liability and other legal claims could have an adverse effect on our financial condition and results of operations.

As a manufacturer of products widely used in commerce, we are subject to product liability claims and litigation, as well as warranty claims. From time to time claims may involve material amounts and novel legal theories, and any insurance we carry may not provide inadequateadequate coverage to insulate us from material liabilities for these claims.

In addition to product liability claims, we are subject to legal proceedings and claims that arise in the ordinary course of business, such as workers' compensation claims, OSHA investigations, employment disputes and customer and supplier disputes arising out of the conduct of our business. Litigation may result in substantial costs and may divert management's attention and resources from the operation of our business, which could have a material adverse effect on our business, results of operations or financial condition.As described in more detail in “Item 3-Legal Proceedings” below, we are currently appealing a judgment rendered by the Fourth Civil Court of Curitiba, Brazil, in a lawsuit that has been pending since 2001. While we are appealing this judgment, which renders it unenforceable at this time, and the Brazilian Court of Appeals has the authority to render a new judgment in the case without any regard to the lower court’s findings, the ultimate outcome of the case is uncertain and the resolution of this litigation may result in us incurring substantial costs that are not covered by insurance.

An impairment in the carrying value of goodwill and other long-lived intangible assets could negatively affect our operating results.

We have a substantial amount of goodwill and purchased intangible assets on our balance sheet as a result of acquisitions. At December 31, 2014, approximately 90% of these long-lived intangible assets were concentrated in our Diversified Products segment. The carrying value of goodwill represents the fair value of an acquired business in excess of identifiable assets and liabilities as of the acquisition date. The carrying value of other long-lived intangible assets represents the fair value of trademarks and trade names, customer relationships and technology as of the acquisition date, net of any accumulated amortization. Under generally accepted accounting principles, goodwill is required to be reviewed for impairment at least annually, or more frequently if potential interim indicators exist that could result in impairment, and other long-lived intangible assets require review for impairment only when indicators exist. If any business conditions or other factors cause profitability or cash flows to significantly decline, we may be required to record a non-cash impairment charge, which could adversely affect our operating results. Events and conditions that could result in impairment include a prolonged period of global economic weakness, a further decline in economic conditions or a slow, weak economic recovery, sustained declines in the price of our common stock, adverse changes in the regulatory environment, adverse changes in the market share of our products, adverse changes in interest rates, or other factors leading to reductions in the long-term sales or profitability that we expect.

The full utilization of our remaining U.S. federal income tax net operating loss carryforwards has significantly increased, and will continue to significantly increase, our cash tax payments and may adversely impact our ability to fund operations.

During 2014 we utilized all of our remaining U.S. Federal income tax net operating loss carryforwards and credit carryforwards and, therefore, experienced an increase in our cash tax payments in 2014 as compared to previous years. We anticipate further increases in our tax payments in 2015, which could limit the amount of liquidity available to fund working capital, capital expenditures or other strategic initiatives.

Our ability to fund operations is limited by our cash on hand and available borrowing capacity under our revolving credit facility.

We believe our liquidity, defined as cash on hand and available borrowing capacity, on December 31, 2014 of $289.9 million and our expected continued improvements in profitability will be more than adequate to fund working capital requirements and capital expenditures throughout 2015, which we expect to be a period of continued strong demand within the trailer manufacturing industry. Furthermore, we continue to have the option, subject to certain conditions, to request an additional incremental increase to the total commitment of our revolving credit facility of $50 million. Our liquidity position as of December 31, 2014 represented an increase of $35.6 million and $65.6 million from December 31, 2013 and 2012, respectively. Our ability to fund our working capital needs and capital expenditures is limited by the net cash provided by operations, cash on hand and available borrowings under our revolving credit facility. Declines in net cash provided by operations, increases in working capital requirements necessitated by an increased demand for our products and services, further decreases in the availability under the revolving credit facility or changes in the credit our suppliers provide to us, could rapidly exhaust our liquidity.

Risks Related to Our Indebtedness

Our increased levels of indebtedness could adversely affect our business, financial condition and results of operations and our ability to meet our payment obligations under our debt agreements.

Our debt and debt service obligations increased significantly in 2012 as a result of the offering of our 3.375% Convertible Senior Notes Due 2018 (“Notes”) in April 2012, entering into the Term Loan Credit Agreement in May 2012, which was subsequently amended in May 2013, and the amendment and restatement of our revolving credit agreement. As of December 31, 20122014, and as a result of these events, we had approximately $453$352 million of indebtedness, including: $298$193 million secured debt, $150 million unsecured and approximately $5debt, $7 million in capital lease obligations.obligations and $2 million in an industrial revenue bond. This level of debt could have significant consequences on our future operations, including, among others:

Any of the factors listed above could have a material adverse effect on our business, financial condition and results of operations and our ability to meet our payment obligations under our debt agreements.

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Servicing our debt requireswill require a significant amount of cash, and we may not have sufficient cash flow from our business to pay our debt obligations.

Our ability to make scheduled principal payments of the principal of, to pay interest on or to refinance our indebtedness depends on our future performance, which is subject to regulatory, economic, financial, competitive and other factors beyond our control. OurWhile we do not have significant scheduled principal payments until 2018, our business may not continue to generate cash flow from operations in the future sufficient to service our debt and make necessary capital expenditures. If we are unable to generate such cash flow, we may be required to adopt one or more alternatives, such as selling assets, restructuring debt or obtaining additional equity capital on terms that may be onerous or highly dilutive. Our ability to refinance our indebtedness will depend on the capital markets and our financial condition at such time. We may not be able to engage in any of these activities or engage in these activities on desirable terms, which could result in a default on our debt obligations.

Despite our current debt levels, we may still incur substantially more debt or take other actions that would intensify the risks discussed above.

Despite our current consolidated debt levels, we and our subsidiaries may be able to incur substantial additional debt in the future, subject to the restrictions contained in our debt instruments, some of which may be secured debt. We are not restricted under the terms of the indenture governing the Notes from incurring additional debt, securing existing or future debt, recapitalizing our debt or taking a number of other actions that are not limited by the terms of the indenture governing the Notes. Our ExistingAmended and Restated Revolving Credit Agreement restricts our ability to incur additional indebtedness, including secured indebtedness, but if the facilities mature or are repaid, we may not be subject to such restrictions under the terms of any subsequent indebtedness.

The conditional conversion feature of the Notes, if triggered, may adversely affect our financial condition and operating results.

In the event the conditional conversion feature of the Notes is triggered, holders of Notes will be entitled to convert the Notes at any time during specified periods at their option. If one or more holders elect to convert their Notes, unless we elect to satisfy our conversion obligation by delivering solely shares of our common stock (other than cash in lieu of any fractional share), we would be required to settle a portion or all of our conversion obligation through the payment of cash, which could adversely affect our liquidity. In addition, even if holders do not elect to convert their Notes, we could be required under applicable accounting rules to reclassify all or a portion of the outstanding principal of the notes as a current rather than long-term liability, which would result in a material reduction of our net working capital.

Future sales of our common stock in the public market could lower the market price for our common stock and adversely impact the trading price of the Notes.

In the future, we may sell additional shares of our common stock to raise capital. In addition, a substantial number of shares of our common stock are reserved for issuance upon the exercise of stock options and upon conversion of the Notes. We cannot predict the size of future issuances or the effect, if any, that they may have on the market price for our common stock. The issuance and sale of substantial amounts of common stock, or the perception that such issuances and sales may occur, could adversely affect the market price of our common stock and the trading price of the Notes and impair our ability to raise capital through the sale of additional equity securities.

Provisions of the Notes could discourage a potential future acquisition of us by a third party.

Certain provisions of the Notes could make it more difficult or more expensive for a third party to acquire us. Upon the occurrence of certain transactions constituting a fundamental change, holders of the Notes will have the right, at their option, to require us to repurchase all of their Notes or any portion of the principal amount of such Notes in integral multiples of $1,000. We also may be required to issue additional shares upon conversion in the event of certain corporate transactions. In addition, the indenture for the Notes prohibits us from engaging in certain mergers or acquisitions unless, among other things, the surviving entity assumes our obligations under the Notes. These and other provisions of the Notes could prevent or deter a third party from acquiring us even where the acquisition could be beneficial to you.our stockholders.

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ITEM 1B – 1B—UNRESOLVED STAFF COMMENTS

None.

ITEM 2 – —PROPERTIES

Our main Lafayette, Indiana facility is a 1.2 million square foot facility that houses truck trailer and composite material production, tool and die operations, research laboratories and offices. Our second Lafayette, Indiana facility is 0.8 million square feet and used primarily for the production of refrigerated trailersvan and frac tanks.liquid tank trailers. In total, our main facilities have the capacity to produce approximately 80,000 van trailers annually on a three shift, five-day workweek schedule, depending on the mix of products.

We have 1815 Retail branch facilities located throughout North America. Each sales and service branch consists of an office, parts warehouse and service space, and ranges in size from 4,000 to 70,000 square feet per facility. The 1815 facilities are located in 1311 states with eightseven of the facilities being leased.

Properties owned by Wabash are subject to security interests held by our lenders. The following table provides information regarding our major facilities located in the United States, Mexico and United Kingdom:

Location		Owned or Leased
Location		Owned or Leased		Description of Activities at Location		Segment
Ashland, Kentucky		Leased		Parts distribution		Retail
Baton Rouge, Louisiana		Leased		Service and parts distribution		Retail
Cadiz, Kentucky		Leased		Manufacturing, new trailers and parts distribution		Commercial Trailer Products and Retail
Chicago, Illinois		Leased		Service and parts distribution		Retail
Columbus, Ohio		Owned		New trailers, used trailers, service and parts distribution		Retail
Dallas, Texas		Owned		New trailers, used trailers, service and parts distribution		Retail
Denver, Colorado		Owned		New trailers, used trailers, service and parts distribution		Retail
Dunmore, Pennsylvania		Owned		New trailers, used trailers, service and parts distribution		Retail
Elroy, Wisconsin		Owned		Manufacturing		Diversified Products
Findlay, Ohio		Leased		Service and parts distribution		Diversified Products
Fond du Lac, Wisconsin		Owned		Manufacturing		Diversified Products
Fontana, CaliforniaFrankfort, Indiana		OwnedLeased		New trailers, used trailers, service and parts distributionManufacturing		RetailDiversified Products
Harrison, Arkansas		Owned		Manufacturing		Diversified Products
Houston, Texas		Leased		Service and parts distribution		Retail
Huddersfield, United Kingdom		Leased property/ Owned building		Manufacturing		Diversified Products
Kansas City, Kansas		Leased		Manufacturing		Diversified Products
Kansas City, Missouri		Leased		Manufacturing		Diversified Products
Lafayette, Indiana		Owned		Corporate Headquarters, Manufacturing and used trailers		Commercial Trailer Products, Diversified Products and Retail
Mauston, Wisconsin		Leased		Service and parts distribution		Retail
Miami, Florida		Owned		New trailers, used trailers, service and parts distribution		Retail
New Lisbon, Wisconsin		OwnedOwned/Leased		Manufacturing		Diversified Products
Phoenix, Arizona		Owned		New trailers, used trailers, service and parts distribution		Retail
Pittsburgh, Pennsylvania		Owned		New trailers, used trailers, service and parts distribution		Retail
Portland, Oregon		Owned/Leased		Manufacturing new trailers, used trailers, service and parts distribution		Diversified Products and Retail
Queretaro, Mexico		Owned		Manufacturing		Diversified Products
Sacramento, California		Leased		New trailers, used trailers, service and parts distribution		Retail
San Antonio, Texas		Owned		New trailers, used trailers, service and parts distribution		Retail
Scranton,Smithton, Pennsylvania		Owned		New trailers, used trailers, service and parts distribution		Retail
Tavares, Florida		Leased		Manufacturing		Diversified Products
Waxahachie, Texas		Leased		Used trailers		Retail
West Memphis, Arkansas		Leased		Service and parts distribution		Retail

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Wabash, and since 2006 we have not received noany further notices or communications regarding this matter from the state of North Carolina. We do not expect that this designation will have a material adverse effect on our financial condition or results of operations.

ITEM 4 — 4—MINE SAFETY DISCLOSURES

Not Applicable.

PART II

ITEM 5 —

MARKET FOR REGISTRANT’S COMMON STOCK, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

ITEM 5—MARKET FOR REGISTRANT’S COMMON STOCK, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Information Regarding our Common Stock

Our common stock is traded on the New York Stock Exchange (ticker symbol: WNC). The number of record holders of our common stock at February 21, 201319, 2015 was 867.856.

We declared quarterly dividends of $0.045 per share on our common stock from the first quarter of 2005 through the third quarter of 2008. In December 2008, we suspended the payment of our quarterly dividend due to the continued weak economic environment and the uncertainty as to the timing of a recovery as well as our effort to enhance liquidity. No dividends on our common stock were declared or paid in 2012.2014. The reinstatement of quarterly cash dividends on our common stock will depend on our future earnings, capital availability, financial condition and the discretion of our Board of Directors.

On May 13, 2010, our stockholders approved an amendment to our

Our Certificate of Incorporation, as amended to increase the number of authorizedand approved by our stockholders, authorizes shares of common stock, par value $0.01 per share, from 75 million shares toof 200 million shares and correspondingly, to increase the total number of authorized shares of all classes of capital stock from 100 million shares toof 225 million shares, which includesincluding 25 million shares of preferred stock, par value $0.01 per share.

High and low stock prices as reported on the New York Stock Exchange for the last two years were:

		High				Low
2013
First Quarter		$	11.00			$	9.02
Second Quarter		$	10.81			$	8.19
Third Quarter		$	11.95			$	9.42
Fourth Quarter		$	12.91			$	11.06
2014
First Quarter		$	14.60			$	11.77
Second Quarter		$	14.89			$	12.52
Third Quarter		$	14.91			$	12.94
Fourth Quarter		$	13.41			$	9.44

		High				Low
2011
First Quarter			$13.17				$9.85
Second Quarter			$11.99				$8.45
Third Quarter			$9.78				$4.48
Fourth Quarter			$8.12				$4.22
2012
First Quarter			$11.55				$7.82
Second Quarter			$10.38				$5.85
Third Quarter			$8.00				$5.65
Fourth Quarter			$9.41				$6.19

30

		Years Ended December 31,
		2012				2011				2010				2009				2008
		(Dollars in thousands, except per share data)
Statement of Comprehensive Income Data:
Net sales		$	1,461,854			$	1,187,244			$	640,372			$	337,840			$	836,213
Cost of sales			1,298,031				1,120,524				612,289				360,750				815,289
Gross profit		$	163,823			$	66,720			$	28,083			$	(22,910	)		$	20,924
Selling, general and administrative expenses			68,340				43,975				40,545				40,209				55,429
Amortization of intangibles			10,590				2,955				2,955				2,955				2,955
Acquisition expenses			14,409				—				—				—				—
Impairment of goodwill			—				—				—				—				66,317
Income (Loss) from operations		$	70,484			$	19,790			$	(15,417	)		$	(66,074	)		$	(103,777	)
Interest expense			(21,724	)			(4,136	)			(4,140	)			(4,379	)			(4,657	)
Increase in fair value of warrant			—				—				(121,587	)			(33,447	)			—
Other, net			(97	)			(441	)			(667	)			(866	)			(328	)
Income (Loss) before income taxes		$	48,663			$	15,213			$	(141,811	)		$	(104,766	)		$	(108,762	)
Income tax (benefit) expense			(56,968	)			171				(51	)			(3,001	)			17,064
Net income (loss)		$	105,631			$	15,042			$	(141,760	)		$	(101,765	)		$	(125,826	)
Preferred stock dividends and early extinguishment			—				—				25,454				3,320				—
Net income (loss) applicable to common stockholders		$	105,631			$	15,042			$	(167,214	)		$	(105,085	)		$	(125,826	)
Basic and diluted net income (loss) per common share		$	1.53			$	0.22			$	(3.36	)		$	(3.48	)		$	(4.21	)
Common stock dividends declared		$	—			$	—			$	—			$	—			$	0.135
Balance Sheet Data:
Working capital		$	221,402			$	95,529			$	61,427			$	(34,927	)		$	(2,698	)
Total assets		$	902,626			$	388,050			$	302,834			$	223,777			$	331,974
Total debt and capital leases		$	425,151			$	69,821			$	59,554			$	33,243			$	85,148
Stockholders' equity		$	268,727			$	146,346			$	129,025			$	53,485			$	153,437

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and regulatory changes addressed above, these demand drivers could be offset by factors that contribute to the increased concentration and density of loads, including the miniaturization of electronic products and packaging optimization of bulk goods. Increases in load concentration or density could contribute to decreased need or demand for dry van trailers.

– -

Trucking company profitability, which can be influenced by factors such as fuel prices, freight tonnage volumes, and government regulations, is highly correlated with the overall economy of the U.S. Carrier profitability significantly impacts demand for, and the financial ability to purchase, new trailers.

– -

Although truck driver shortages have not been a significant problem in the past year, constraints are expected to exacerbate as fleetFleet equipment utilization increaseshas been rising due to increasing freight volumes, new government regulations.regulations and shortages of qualified truck drivers. As a result, trucking companies are under increased pressure to look for alternative ways to move freight, leading to more intermodal freight movement. We believe that railroads are at or near capacity, which will limit their ability to respond to freight demand pressures. Therefore, we expect that the majority of freight will continue to be moved by truck and, according to ATA, overall truck activity as a percentage of the total freight industry is expected to increase throughout the next decade.

Results of Operations

The following table sets forth certain operating data as a percentage of net sales for the periods indicated:

		Years Ended December 31,
		2012				2011				2010
Net sales			100.0	%			100.0	%			100.0	%
Cost of sales			88.8				94.4				95.6
Gross profit			11.2				5.6				4.4
General and administrative expenses			3.1				2.6				4.6
Selling expenses			1.6				1.1				1.7
Amortization of intangibles			0.7				0.2				0.5
Acquisition expenses			1.0				—				—
Income (Loss) from operations			4.8				1.7				(2.4	)
Interest expense			(1.5	)			(0.3	)			(0.6	)
Increase in fair value of warrant			—				—				(19.0	)
Other, net			—				(0.1	)			(0.1	)
Income (Loss) before income taxes			3.3				1.3				(22.1	)
Income tax benefit			(3.9	)			—				—
Net income (loss)			7.2	%			1.3	%			(22.1	)%

		Years Ended December 31,
		2014				2013				2012
Net sales			100.0	%			100.0	%			100.0	%
Cost of sales			87.5				86.8				88.8
Gross profit			12.5				13.2				11.2
General and administrative expenses			3.3				3.6				3.1
Selling expenses			1.4				1.9				1.6
Amortization of intangibles			1.2				1.3				0.7
Acquisition expenses			-				0.1				1.0
Income from operations			6.6				6.3				4.8
Interest expense			(1.2	)			(1.6	)			(1.5	)
Other, net			(0.1	)			-				-
Income before income taxes			5.3				4.7				3.3
Income tax expense (benefit)			2.0				1.9				(3.9	)
Net income			3.3	%			2.8	%			7.2	%

20122014 Compared to 20112013

Net Sales

Net sales in 2012 were $1.5 billion, an increase of $274.72014 increased $227.6 million, or 23.1%13.9%, compared to 2011.the 2013 period. By operatingbusiness segment, net external sales and related units sold were as follows (dollars in millions):

		Year Ended December 31,
										Change
		2014				2013				$				%
Sales by Segment
Commercial Trailer Products		$	1,221.0			$	1,010.7			$	210.3				20.8
Diversified Products			453.2				444.8				8.4				1.9
Retail			189.1				180.2				8.9				4.9
Total		$	1,863.3			$	1,635.7			$	227.6				13.9
New Trailers			(units)
Commercial Trailer Products			50,350				40,750				9,600				23.6
Diversified Products			3,550				3,050				500				16.4
Retail			3,450				3,000				450				15.0
Total			57,350				46,800				10,550				22.5
Used Trailers			(units)
Commercial Trailer Products			3,150				4,300				(1,150	)			(26.7	)
Diversified Products			150				100				50				50.0
Retail			1,550				1,300				250				19.2
Total			4,850				5,700				(850	)			(14.9	)

Commercial Trailer Products segment sales were $1.2 billion in 2014, an increase of $210.3 million, or 20.8%, compared to 2013. The increase in sales was primarily due to a 23.6% increase in new trailer shipments, as approximately 50,350 trailers were shipped in 2014 compared to 40,750 trailers shipped in the prior year. The increase in trailer shipments was partially offset by product mix, which lowered average selling prices by 0.7% as compared to the prior year. Used trailer sales decreased $9.9 million, or 29.5%, compared to the previous year with approximately 1,150 fewer used trailer shipments in 2014 as compared to the prior year, which was primarily due to decreased availability of product because of fewer fleet trade packages received.

Diversified Products segment sales were $453.2 million in 2014, up $8.4 million, or 1.9%, compared to 2013. New trailer sales increased $22.6 million, or 11.0%, due to a 16.4% increase in new trailer shipments, as approximately 3,550 trailers were shipped in 2014 compared to 3,050 trailers shipped in the prior year, partially offset by a 5.2% decrease in average selling prices. Parts and service sales decreased $4.9 million, or 5.3%, compared to the prior year due to decreased demand. Equipment and other sales decreased $10.7 million, or 7.4%, due to the timing of shipments and customer acceptance for our non-trailer truck mounted equipment and other engineered products. Used trailer sales increased $1.4 million, or 45.4%, as a result of an increase in used trailer shipments and a favorable customer and product mix, which increased used trailer average selling prices by 15.2% as compared to 2013.

Retail segment sales were $189.1 million in 2014, up $8.9 million, or 4.9%, compared to 2013. New trailer sales increased $6.0 million, or 7.3%, as approximately 450 more trailers were shipped in 2014 as compared to 2013. As compared to the prior year, new trailer average selling prices decreased 5.8%, primarily due to customer and product mix. Used trailer sales increased $4.1 million, or 32.2%, primarily due to an increase in volume demand, as approximately 250 more used trailers were shipped in 2014 as compared to 2013. Parts and service sales were down $0.5 million, or 0.6%, and equipment and other sales were down $0.7 million, or 16.6%, as compared to the prior year.

Cost of Sales

Cost of sales in 2014 was $1.6 billion, an increase of $210.1 million, or 14.8%, as compared to 2013. As a percentage of net sales, cost of sales was 87.5% in 2014, compared to 86.8% for 2013.

Commercial Trailer Products segment cost of sales, as detailed in the following table, was $1.1 billion in 2014, an increase of $189.6 million, or 20.5%, compared to 2013. As a percentage of net sales, cost of sales was 91.4% in 2014 compared to 91.7% in 2013.

		Year Ended December 31,
Commercial Trailer Products Segment		2014								2013
		(dollars in millions)
						% of Net Sales								% of Net Sales
Material Costs		$	885.6				72.5	%		$	729.4				72.2	%
Other Manufacturing Costs			230.6				18.9	%			197.2				19.5	%
		$	1,116.2				91.4	%		$	926.6				91.7	%

Cost of sales is comprised of material costs, a variable expense, and other manufacturing costs, comprised of both fixed and variable expenses, including direct and indirect labor, outbound freight, and overhead expenses. Material costs were 72.5% of net sales in 2014 compared to 72.2% in 2013. Material costs as a percentage of sales in 2014 are in line with 2013 as raw material, commodity, and component costs have remained relatively consistent as compared to the prior year. Other manufacturing costs increased $33.4 million in the current year as compared to the prior year, resulting from increased labor and other variable costs related to increases in new trailer production volumes. As a percentage of sales, other manufacturing costs decreased from 19.5% in 2013 to 18.9% in 2014 due to increased leverage of fixed costs from higher production.

Diversified Products segment cost of sales was $349.8 million in 2014, an increase of $13.6 million, or 4.0%, compared to 2013. The increase in cost of sales was primarily driven by an increase in sales volume due to stronger tank trailer demand as compared to the prior year. Cost of sales as a percentage of net sales was 77.2% in 2014 compared to 75.6% in 2013. The 1.6% increase as a percentage of net sales was primarily the result of lower average selling prices for tank trailers due to customer and product mix as compared to the prior year, as well as competitive market pressures within certain product lines of both the composite product and tank trailer businesses.

Retail segment cost of sales was $168.4 million in 2014, an increase of $8.4 million, or 5.2%, compared to 2013. As a percentage of net sales, cost of sales was 89.0% in 2014 compared to 88.8% in 2013. Cost of sales as a percentage of net sales increased slightly compared to the prior year as a result of product mix as a higher percentage of sales were from the lower margin new and used trailer product lines as compared to the prior year.

Gross Profit

Gross profit was $232.6 million in 2014, an improvement of $17.5 million from 2013. Gross profit as a percentage of sales was 12.5% in 2014 as compared to 13.2% in 2013. Gross profit by segment was as follows (in millions):

		Year Ended December 31,
										Change
		2014				2013				$				%
Gross Profit by Segment:
Commercial Trailer Products		$	104.8			$	84.2			$	20.6				24.5
Diversified Products			103.4				108.6				(5.2	)			(4.8	)
Retail			20.7				20.1				0.6				3.0
Corporate and Eliminations			3.7				2.2				1.5
Total		$	232.6			$	215.1			$	17.5				8.1

Commercial Trailer Products segment gross profit was $104.8 million in 2014 compared to $84.2 million in the prior year. Gross profit as a percentage of net sales was 8.6% in 2014 as compared to 8.3% in 2013. The increase in gross profit and profit margin as compared to the prior year was primarily driven by the increase in new trailer volumes and improved pricing partially offset by customer and product mix.

Diversified Products segment gross profit was $103.4 million in 2014 compared to $108.6 million in 2013. Gross profit as a percentage of net sales was 22.8% in 2014 compared to 24.4% in 2013. The decreases in gross profit and gross profit as a percentage of net sales, as compared to the prior year, are primarily due to product mix and competitive market pressures within certain product lines.

Retail segment gross profit was $20.7 million in 2014 compared to $20.1 million in 2013. Gross profit as a percentage of net sales in 2014 was 11.0% compared to 11.2% in 2013. Gross profit margin was relatively consistent with the prior year as increased demand was offset by product mix and an increase in costs to support growth initiatives.

General and Administrative Expenses

General and administrative expenses in 2014 increased $3.0 million, or 5.1%, from the prior year as a result of a $4.5 million increase in salaries and employee related costs, including employee incentive programs, partially offset by decreases in bad debt expense of $0.7 million, due to certain uncollectable accounts receivable identified in the prior year, as well as lower outside professional services of $0.4 million. General and administrative expenses, as a percentage of net sales, were 3.3% in 2014 compared to 3.6% in 2013.

Selling Expenses

Selling expenses were $26.7 million in 2014, a decrease of $3.9 million, or 12.8%, compared to the prior year, primarily due to a $3.2 million decrease in salaries and employee related costs, including employee incentive programs, and lower advertising and promotional costs. As a percentage of net sales, selling expenses were 1.4% in 2014 compared to 1.9% in the prior year.

Amortization of Intangibles

Amortization of intangibles was $21.9 million in 2014 compared to $21.8 million in 2013. Amortization of intangibles for both periods primarily includes amortization expense recognized for intangible assets recorded from the acquisition of Walker in May 2012 and certain assets of Beall in February 2013.

Other Income (Expense)

Interest expense in 2014 totaled $22.2 million compared to $26.3 million in the prior year. Interest expense for both periods primarily relates to interest and non-cash accretion charges on our Convertible Senior Notes and Term Loan Credit Agreement. The decrease from the previous year is due to lower outstanding loan commitments through voluntary debt payments made over the previous year, as well as reduced interest rates achieved as a result of repricing the Term Loan Credit Agreement in April 2013.

Other, net in 2014 includes a loss on early extinguishment of debt of $1.0 million, representing the write-off of debt issuance costs recognized on $40 million of voluntary principal payments made on our Term Loan Credit agreement during 2014, as well as a $0.6 million loss on the transition of three of our Retail branch locations to independent dealer facilities.

Income Taxes

We recognized income tax expense of $37.5 million in 2014 compared to $31.1 million in the prior year. The effective tax rate for 2014 was 38.1%, which differs from the U.S. Federal statutory rate of 35% primarily due to the impact of state and local taxes and the federal domestic production deduction. During 2014, we utilized all our remaining U.S. Federal income tax net operating loss carryforwards or income tax credit carryforwards and, as a result, we anticipate increases in our cash tax payments in 2015 as compared to 2014. Cash taxes paid in 2014 were approximately $20.2 million.

2013 Compared to 2012

Net Sales

Net sales in 2013 increased $173.8 million, or 11.9%, compared to the 2012 period. By business segment, net external sales and related units sold were as follows (dollars in millions):

		Year Ended December 31,
										Change
		2012				2011				$				%
Sales by Segment
Commercial Trailer Products		$	993.9			$	1,010.1			$	(16.2	)			(1.6	)
Diversified Products			311.0				52.0				259.0				498.1
Retail			157.0				125.1				31.9				25.5
Total		$	1,461.9			$	1,187.2			$	274.7				23.1