X

Trucking conditions remain favorable

Jason Cannon August 16, 2013

FTR Associates’ Trucking Conditions Index (TCI) for June was 6.46, which the company says reflects a significantly revised index that now includes a factor for truckload pricing and an update to historical data.

A full explanation of these changes and the details of the June TCI Index are found in the August issue of the Trucking Update published August 1. As compared to the previous month’s revised index, June improved more than 30 percent.

“This month marks a large update to our Trucking Conditions Index. As the industry has struggled to implement reasonable price increases despite a high level of truck utilization, our index has incorporated a more complete picture of the carrier’s operating environment,” Jonathan Starks, director of transportation analysis for FTR, says. “This has led to a lowering of the index but we still feel that carriers are operating in a positive environment. The onset of HOS changes is expected to tighten capacity further and should lead to a more robust rate environment as we move through the fall shipping season. The major factors in our anticipation of continued elevated levels in the index are capacity and rates. If volumes were too see an unexpected burst of activity this fall, it could be a decisive factor in moving the index to a level that would indicate more rapid acceleration in freight rates and margins. Those are important elements as costs have generally outgrown rate increases over the last year.”

Active truck utilization is moving up as the effects of Hours of Service regulations kick in and FTR forecasts a 3 percent productivity reduction from HOS. The company expects an even more significant hit to productivity with a collection of smaller regulatory rules that will affect the industry between 2014 and 2016.

The TCI is designed to summarize a full collection of industry metrics, with a reading above zero indicating a generally positive environment for truckers. Readings above 10 would signal that volumes, prices, and margins are likely to be in a solidly favorable range for trucking companies.

The Trucking Update, published monthly, is part of FTR’s Freight Focus Series and reports data that directly impacts the activity and profitability of truck fleets.

Poll

How would you categorize the state of your business 10 months into 2014?

Latest

September trailer orders ‘strong’, up 80%

Peach State Freightliner branch certified for Elite Support

Border International adds new trailer location

Popular

Maudlin International provides football hauler to alma mater

GALLERY: Bendix showcases remanufacturing investment

M&K Truck Centers relocating Holland parts and service facility

Successful Dealer Award

Click here to read about the award and see the nominees for this year's award.