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ATA’s Costello: The biggest problem with 2019 is it had to follow 2018

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Speaking at the annual Arkansas Trucking Association For For For For For For For For Business Conference, American Trucking Association Chief Economist and Senior Vice President Bob Costello says that fears of an impending recession are premature. The industry is still growing, just not at the breakneck pace of late 2017 and 2018. (The Trucker: KLINT LOWRY)

We’ve all experienced it. You’ve been driving 70 mph for a while. Suddenly, you’re forced to slow down to 45 mph. It feels like you are crawling, even though a part of you knows if you were going this fast on a residential street, you’d feel like you were blazing.

Bob Costello, chief economist and senior vice president of international trade policy and cross-border operations for the American Trucking Associations, has noticed that a lot of people in trucking are having a similar sensation when they look at the economic health of the industry.

Costello was in Little Rock, Arkansas, May 15 for the annual Arkansas Trucking Association For For For For For For For For Business Conference and Vendor Showcase to give his perspective on the current state of the economy and the industry.

Everywhere he goes these days, Costello told the crowd, everyone keeps asking, “Are we headed to a recession?” After all, things definitely slowing down.

“I don’t believe that, folks,” Costello said flatly. “However, we have to reset our expectations. What I say is, we’re slowing, but we’re still growing. We have some reduced momentum. We are headed back to trend.”

The biggest problem about 2019 is it came after 2018, and 2018 was a hard act to follow.

“The big mistake is to look at year-over-year comps,” Costello said. “Those are not going to be good because 2018 was so good.

“Instead, take a more long-term look at where we were compared to several years ago and what direction we are heading. We may not be skyrocketing like we did for about a year and a half, but we are still moving upward, albeit at a more normal pace.

“Really, we’re in a decent spot. It’s not going to be 2018. But it’s certainly not going to be terrible, either.”

Costello said he wouldn’t expect a recession until 2021, at the earliest. Part of that is because the Federal Reserve has said they were going to put interest rate hikes on pause.

“Economic expansions do not die of old age,” Costello said. “They’re usually murdered.” And the Fed is often the culprit, but this time their restraint has come in time to hold off a recession.

That’s not to say there’s nothing to worry about, he added.  Gross domestic product took an upswing in the first quarter of 2019, Costello said, up 3.2%. That sounds good, until you consider that it was inflated by retailers stockpiling inventories at the time because of the threat of tariffs against China.

“I talk to retailers all the time,” Costello said. “They were bringing in as much stuff as they could.”

The term gets thrown around a lot, but Costello fears the U.S. is getting dangerously close to a genuine trade war with China. With tariffs going up, everything is going to get more expensive, and you don’t have to be an economic whiz to know what that will do to consumer spending.

Costello expects we’ll see consistent growth in the 2% range for the foreseeable future. Not spectacular, “but it’s still growth.”

Consumer sales is one of the key factors to look at that affects trucking. And one of the key factors in assessing the health of the consumer is to look at the job market. Here, the numbers are so good as to be almost inexplicable, Costello said.

For the past year, the American Job market has added an average of 212,000 a month.

“I don’t know where these people are coming from,” Costello said. You can expect an increase of about 60,000 simply from population growth, he said, “anything above that and you’re finding folks from somewhere.”

Some say it’s people returning to the job market from the recession, Costello said, but that was 10 years ago. Could immigration account for some of it? Maybe a little. But wherever they’re coming from, he doesn’t expect it can continue at this pace. The thing to remember, once again, is once it does, it only means it’s getting closer to normal.

The same could be said for the unemployment rate. It’s now at the lowest it’s been since December 1969. “Do you know we now have more job openings than we have unemployed people?” he said. “It’s been that way for almost two years now.”

Of course, when the job market’s good, salaries go up. And when incomes go up, spending goes up.

Another key indicator for trucking is the housing market. With 1.23 million new homes expected to be built, this is one of the less spectacular aspects of the economic picture, Costello said, but sometimes you have to adjust how you look at the numbers. For starters, millennials are not as concerned about home ownership as previous generations. Also, in a lot of desirable areas, there just isn’t any space left to build.

Another area where the industry needs to look at the numbers differently is inventories. Costello said. With the rise in eCommerce and quicker delivery guarantees, more merchandise has to be out there in the supply chain for local delivery, no matter where “local” happens to be.

“This is the change in the supply chain right here, and it has all sorts of ramifications,” Costello said.

Average length of haul for truckload has gone from nearly 800 miles to 507 miles last year, he said. “And what does that mean for driver pay and how we pay them?” The raises companies have given aren’t making up for those lost miles. How will that affect driver retention and the driver shortage?

“Let’s be honest, the driver shortage is an over-the-road for-hire truckload problem, it’s not the entire industry,” Costello said.

So, there are challenges the industry needs to address, but the overall state of the industry and the economy are still strong.

“If I have to summarize, 2018 was the best year ever, post-deregulation,” Costello said.  “I think if you took out last year and historically compared it, we’d be in a lot better mood.”

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NATSO releases industry guide addressing top industry questions

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NATSO said "Answers to the Top 18 Questions about the Travel Center Industry" is an essential resource for data on travel center and truckstop industry operations. (Courtesy: NATSO)

ALEXANDRIA, Va. — NATSO, representing America’s travel plazas and truckstops, has released a detailed industry guide  answering the top questions about the travel center industry.

Industry knowledge can improve business performance and help operators drive targeted results, according to Darren Schulte, NATSO’s vice president, membership.

But finding answers isn’t always easy. This is why Schulte dug into the more frequently asked questions about the truckstop and travel center industry and answered them in this new industry guide.

“Answers to the Top 18 Questions about the Travel Center Industry” is an essential resource for data on travel center and truckstop industry operations, Schulte said. The guide contains comparable data that operators can utilize to assess their own operations and better understand the competitive landscape. Operators can then use this information to improve their analysis and strategize advantageous investment decisions.

With the report in hand, operators can gain greater insight into the average sales at a full-service restaurant or a garage or service center, how much a professional truck driver spends on fuel at a truckstop, average staffing costs at a location, and specific sales and costs within a location.

The downloadable “Answers to the Top 18 Questions About the Travel Center Industry” is available for free to NATSO members and non-members for $250.

To download or purchase the guide, click here. 

“The Answers to the Top 18 Questions About the Travel Center Industry” was produced in partnership with Travel Center Profit Drivers, a NATSO initiative that provides access to specialized, experienced consultants and the tools they have created to help travel centers thrive. Truckstop and travel center operators looking for help building or growing their business should contact Don Quinn, NATSO Services vice president, at (703) 739-8572 or [email protected] to discuss how the NATSO team can help.

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Ohio’s Scott Woodrome wins top honors at Newsal Truck Driving Championships

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FedEx Freight driver Scott Woodrome stands beside the two trophies he won at the 2019 Newsal Truck Driving Championships. It was the second consecutive year he was named Bendix Grand Champion. He also won the Twin Trailer Division. (Courtesy: AMERICAN TRUCKING ASSOCIATIONS)

PITTSBURGH — Scott Woodrome, a professional truck driver from Middletown, Ohio, representing team FedEx Freight, has been named the Bendix Grand Champion of the 2019 Newsal Truck Driving Championships conducted by the American Trucking Associations.

This is Woodrome’s second consecutive year of winning the Bendix Grand Champion trophy.

“Congratulations to Scott and his great team at FedEx Freight, as well as the entire Ohio trucking industry, for repeating as this year’s Bendix Grand Champion Award winner,” said ATA President and CEO Chris Spear. “This process began with thousands of drivers competing at the state level, but only one driver can emerge as overall grand champion. It’s a true reflection of Scott’s commitment to safety and the trucking industry as a whole that he was able to take home top honors again this year.”

Woodrome, a longtime competitor in truck driving championships with more than 1.8 million lifetime safe driving miles, competed in the Twins division. He has been in the trucking industry for 25 years, spending 13 of those years with FedEx Freight.

Woodrome took home the 2018 Bendix Grand Champion Award for his performance in the Tanker class, as well as the 2017 Newsal Champion Award in the Tanker class and six Ohio state championships.

“It’s been such an honor to host hundreds of our nation’s elite truck drivers this week and showcase their skills as safe professionals,” said ATA Chairman Barry Pottle, president of Pottle’s Transportation. “From start to finish, Pittsburgh was a great location and we loved to see such enthusiastic support from the families and friends who came out to support these impressive drivers.”

ATA also recognized John Sanderson as the 2019 Rookie of the Year. Sanderson claimed the title after an outstanding performance in the three-axle division. To be a “rookie,” drivers must be first-time competitors at the state level who advanced to nationals. This year, there were 32 rookies competing at the Newsal Truck Driving Championships. Sanderson was the only rookie who advanced to the championship round of competition.

In addition to the individual awards, the team of drivers from Pennsylvania went home with the Team Championship. Pennsylvania hosted this week’s competition and had three drivers advance to the championship round of competition. The state of North Carolina took home 2nd place honors, with Virginia coming in 3rd place.

Several individuals excelled outside the driving course throughout this week’s competition, demonstrating their professionalism, knowledge and dedication to the trucking industry. Professional truck driver Robert Dolan of XPO Logistics was recognized with the highly-coveted Professional Excellence award. Additionally, Jason Imhoff of Walmart Transportation is taking home the Vehicle Condition Award for his outstanding performance during the pre-trip inspections.

Nine drivers achieved perfect scores on the written exam phase of the championships and are receiving the Highest Written Exam Award for their efforts. The nine drivers were Paul Brandon, Miguel Corral, Ina Daly, Brent Glasenapp, Julie Hjelle, Barry Kraemer, Jottyn Santos, Jimmie Wisley and Scott Woodrome.

Champions from each of the nine vehicle classes were also announced. Joining Woodrome on the list of national champions include (listed in order of first, second and third with company and home state):

Three-axle: Brian Walker, UPS Freight, North Carolina; Jeffrey Slaten, YRC Freight, Florida; and John Sanderson, FedEx Express, Oregon

Four axle: Adam Heim, FedEx Freight, Idaho; David Rohman, FedEx Express, North Carolina; and James Plaxco, Old Dominion Freight Line, Oregon;

Five axle: David Hall, ABF Freight, Arkansas; Ina Daly, XPO Logistics, Arizona; and Alphonso Lewis, YRC Freight, Alabama.

Flatbed: Basher Pierce, FedEx Freight, North Carolina; Scott Osborne, FedEx Freight, Mississippi; and Eric Flick, FedEx Freight, Nevada.

Sleeper Berth: Mike White, Walmart Transportation, Indiana; Terry Wood, Walmart Transportation, Pennsylvania; and Michael Barnes, Walmart Transportation, Virginia.

Straight Truck: Jason Imhoff; Walmart Transportation, Ohio; Robert Dolan, XPO Logistics, Pennsylvania; and Matthew Hart, FedEx Freight, Nevada

Tank Truck: Paul Brandon, FedEx Freight, Connecticut; George Wells, Shamrock Foods, Arizona; and Cecil Hicks, FedEx Freight, North Carolina

Twins: Scott Woodrome, FedEx Freight, Ohio; David Mogler, FedEx Freight, Colorado; and Shannon Lynch, United Parcel Service, Indiana

Step Van: Adam Stroup, FedEx Express, Nebraska; Gregory Long, FedEx Express, Virginia; and Eric Damon, FedEx Express, Colorado.

ACT 1 served as a premier sponsor of the 2019 Newsal Truck Driving Championships and Newsal Step Van Driving Championships.

Since 2011, Bendix Commercial Vehicle Systems has been the sole sponsor of the Bendix Newsal Truck Driving Championships Grand Champion.

 

 

 

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Peterbilt Motors opens fifth technician institute campus

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Since launching in 2013, the Peterbilt Technician Institute program has graduated more than 600 factory-certified technicians and boasts a 95% placement rate at a Peterbilt service location. (Courtesy: PETERBILT MOTORS CO.)

DENTON, Texas — Peterbilt Motors Co. has opened the company’s fifth Peterbilt Technician Institute (PTI) campus in Rancho Cucamonga, California.

“The PTI program helps meet the Peterbilt dealer network’s growing demand for entry level qualified diesel technicians.  The unique value proposition for graduates of PTI is finding its graduates jobs that often turn into long-term careers,” said Brian Brooks, program manager for the Peterbilt Technician Institute.

“The 50% growth of the Peterbilt dealer network this decade ensures that there are plenty of long-term career opportunities with our dealers, many of which begin as a diesel technician. Through the Peterbilt Technician Institute, Peterbilt is educating the next generation of diesel technicians to deliver exceptional service and drive uptime for our customers,” added Peterbilt’s Technician Program Manager Curtis Crisp.

Since launching in 2013, the PTI program has graduated more than 600 factory-certified technicians and boasts a 95% placement rate at a Peterbilt service location.

Each PTI student earns 12 Peterbilt certifications as well as certifications for both the PACCAR MX-11 and MX-13 engines as they prepare for a career in the diesel industry. PTI is a collaborative program with Universal Technical Institute.

For more information about Peterbilt, visit www.peterbilt.com.

 

 

 

 

 

 

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