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FTR’s Trucking Conditions Index for May at Lowest Level Since 2011

07.12.16 | FTR



FTR’s Trucking Conditions Index (TCI) for May fell to its lowest level since 2011 at a reading of 1.69, nearly five points lower than the previous month. Negatively affecting truckers are lower freight rates and capacity utilization that has dropped below 95%. Looking forward, trucking companies could benefit from a reinstatement of the hours-of-service 34-hour restart conditions that have been batted around in the halls of Congress this summer. If a version of the regulation does go into effect it would likely tighten capacity enough to move pricing. The TCI is currently forecasted to rise into the mid-single digits later in the year, reflecting weak economics up against expected regulatory drag combining to neutralize positive and negative factors affecting the trucking sector.

Details of the May TCI are found in the July issue of FTR’s Trucking Update, published June 30. The ‘Notes by the Dashboard Light’ commentary in the current issue takes a close look at what “BREXIT” means for the U.S. transportation industry.  Along with the TCI and ‘Notes by the Dashboard Light,’ Trucking Update includes data and analysis on load volumes, the capacity environment, rates, costs, and the truck driver situation.


Click here to view the latest release and an interactive graph of the TCI >


Jonathan Starks, Chief Operating Officer at FTR, commented that, “one of the struggles right now is to bridge the gap between what the economic data is telling us and what the anecdotal evidence from carriers is telling us. Part of it has to do with simply how the industry participants feel relative to 2014 and 2015. The market was way up in 2014. Conditions were ideal for spot market players - regulations tightened capacity and weather exacerbated it. Add in some relatively strong economic growth and carriers were feeling extremely good. Now? Capacity has loosened. Spot rates are down, so revenues are down. And recently the contract market has taken a cue from the looser capacity, and weakness has been seen in this sector as well. Surcharge revenues are also way down - which impacts revenue (even though it generally has less impact on the bottom line). Put it all together and you end up with a market that isn’t extremely favorable for carriers, nor is terribly bad. Revenues are down across the board and that makes business operations more difficult, but freight levels are stabilizing and capacity-sapping regulations are coming down the pike - either this year or next.”



Trucking Update, published monthly, is part of FTR’s Freight Focus and reports data that directly impacts the activity and profitability of truck fleets. As part of Trucking Update, FTR forecasts expected trends in this data and the probable short and long term consequences. For more information on how to subscribe to Trucking Update, or other publications within FTR's Freight Focus, send an email to [email protected]  or call (888) 988-1699 ext. 1.

For more than two decades, FTR has been the thought leader in freight transportation forecasting in North America. The company’s national award-winning forecasters collect and analyze all data likely to impact freight movement, issuing consistently reliable reports for trucking, rail, and intermodal transportation as well as providing demand analysis for commercial vehicle and railcar. FTR’s forecasting and specially designed reports have resulted in advanced planning and cost-savings for companies throughout the transportation sector.
 
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