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FTR’s Trucking Conditions Index for May show moderation

Successful Dealer Staff July 14, 2014

FTR mayWith a reading of 5.74, FTR’s Trucking Conditions Index (TCI) in May reflects some headwinds affecting truck fleet results.

Modest recovery growth along with the lack of acceleration in contract rate increases are accompanied now by increased labor and recruiting overhead costs, FTR. A near capacity crisis environment through May is expected to have eased somewhat in June. While still in solidly positive territory, the TCI outlook from FTR has moderated.

Details of the May TCI Index are found in the July issue of FTR’s Trucking Update, published June 30, 2014. The ‘Notes by the Dashboard Light’ commentary discusses oil prices and how they may impact the economy and trucking. Along with the TCI and ‘Notes by the Dashboard Light’, the Trucking Update includes data and analysis on load volumes, the capacity environment, rates, costs, and the truck driver situation, FTR says.

“While still robustly positive, the TCI has moderated recently and reflects some of the challenges currently facing the industry,” says Jonathan Starks, FTR’s director of transportation analysis. “Capacity is tight but has moderated from the critical level that we operated in during and just after the winter months.

“Freight rates seem to be a tale of two cities with contract rates very stable and only showing modest growth, yet spot rate activity has been quite strong since winter hit and has not let off since then. If economic growth continues to remain modest then we would expect the status quo to persist for some time; however, if the economy finally shows a strong growth spurt in 2014 there isn’t sufficient surge capacity in the truck market to be able to easily accommodate that growth. When combined with the inability to quickly add more drivers into the industry we would then expect rate growth to accelerate in both the spot and contract markets.”

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