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Two trucking indexes indicate positive industry environment – Eventi231.com- eventi231.info

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Two trucking indexes indicate positive industry environment

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Two published trucking indexes are showing the ups and downs of the industry, although collectively they indicate a positive environment.

The latest release of ACT’s For-Hire Trucking Index showed the supply-demand balance falling to 50.1 on a seasonally-adjusted basis in September, down from 55.3 in August. The 8.4 percentage point month-over-month decrease in the Volume Index more than offset the 3.2 percentage point sequential drop in the Capacity Index, leading to an essentially balanced market by this measure.

Meanwhile, FTR’s Shippers Conditions Index (SCI) for August improved by a little more than one point from July to a reading of -8.8.  After hitting an all-time low in May, the SCI has steadily moved upward, albeit still in significantly negative territory. Overall, shippers are experiencing some relief from excessively tight capacity, and FTR expects that to continue with rate growth moderating accordingly.  By mid to late 2019 the SCI could be recording neutral readings.

“The September ACT survey showed downticks across each of the volume, productivity and capacity results, though freight rates improved from August,” said Tim Denoyer, ACT Research’s vice president and senior analyst. “The for-hire industry has secured record contract rates this year, but accelerating Class 8 tractor production and slowing freight growth are helping to rebalance the market.”

As part of this month’s survey, ACT Research queried fleets about how much of their fleet is without a driver and whether that is above or below average.

“Our respondents’ fleets are averaging about 7 percent unseated tractors, with 62 percent indicating this is above average and 24 percent saying the current level is normal. Just 14 percent told us their fleet’s unseated tractor level is below average.”

The September fleet purchase intentions reading indicated a slight uptick in equipment demand, with 55.5 percent respondents planning to buy trucks in the next three months. This is an increase from fleet purchase intentions at 54.7 percent in August.

“We believe that, after record year-to-date orders, this series should remain elevated as long lead-time truck orders are built and hit the highways,” Denover said.

“Shippers have experienced some relief in recent weeks as trucking capacity has loosened and rail service stabilized,” said Todd Tranausky, vice president of rail and intermodal at FTR. “However, going into the peak season and the potential for some shippers to pull forward imported volumes, it will bear watching to see if service continues to improve through the end of 2018.”

The Shippers Conditions Index tracks the changes representing four major conditions in the U.S. full-load freight market. These conditions are: freight demand, freight rates, fleet capacity, and fuel price. The individual metrics are combined into a single index that tracks the market conditions that influence the shippers’ freight transport environment. A positive score represents good, optimistic conditions. A negative score represents bad, pessimistic conditions. The index tells you the industry’s health at a glance. In life, running a fever is an indication of a health problem. It may not tell you exactly what’s wrong, but it alerts you to look deeper. Similarly, a reading well below zero on the FTR Trucking Conditions Index warns you of a problem…and readings high above zero spell opportunity. Readings near zero are consistent with a neutral operating environment. Double digit readings (both up or down) are warning signs for significant operating changes.

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