If American Trucking Associations Senior Vice President and Chief Economist Bob Costello could have communicated a thumbs-up to journalists listening in to ATA’s freight forecast conference call July 19, it wouldn’t have been much different from what he said.
Essentially, “based on [predicted] economic growth, the outlook looks good for all modes of freight transportation,” Costello said.
The lobbying group’s economic forecast has been around “for at least 20 years; that’s how long I’ve been here,” noted Costello, explaining that ATA works with IHS Global Insight, a provider of short- and long-term economic analysis for various businesses and made specific to each sector.
The forecast for trucking includes all freight modes because, Costello said, even when freight isn’t transported by truck as a primary mode, secondary freight movement will be on a truck.
Using economic data put through a “transportation model,” the report predicts freight volumes to grow 2.8 percent through this year and jump to 3.4 percent annual growth through 2023, Costello said.
After that, there will be more “modest” freight growth, at a rate of 2.3 percent. Some of that slow-down is because by 2028 there will probably be a recession, and the forecast is “taking that into consideration,” Costello said.
For 2017, he said ATA predicts that 15.18 billion tons of freight will be moved by all transportation modes — truck, rail, pipeline, air and water — and that this number will increase 36.6 percent to 20.73 billion tons in 2028.
Also, over the forecast period, capacity shortfalls will develop as analysts are beginning to see “some selected tightness of freight handling capacity, enough to suggest that capacity expansion will be required if the modes are going to be able to handle anticipated growth.”
While truck volumes are expected to continue to increase and trucking will stay the dominant freight mode, its share of the tonnage will slip to 67.2 percent by 2028, the report predicts, with pipelines picking up the additional market share, and to a lesser extent, rail intermodal.