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FTR Trucking Conditions Index improves slightly in April, still in negative territory

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An FTR executive said it seemed good times in trucking might never end, "but here we are back down to earth." (The Trucker file photo)

BLOOMINGTON, Ind. — FTR’s Trucking Conditions Index rebounded marginally in April to a -0.64 reading.

Conditions improved slightly from the previous month, but TCI remains in negative territory as the rate environment continues to soften.

Economic indicators linked to freight are generally weaker, and FTR expects that the index will remain in a narrow band of negative readings through 2019 and into the 2020 calendar year, FTR said.

Details of the April TCI are found in the June issue of FTR’s Trucking Update, published May 31. The ‘Notes by the Dashboard Light’ section in the current issue includes an updated analysis of the current trade situation and the impact it is having on freight. 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.

“Not that long ago, it seemed inconceivable that the good times in trucking would end, but here we are back down to earth,” said Avery Vise, vice president of trucking. “Growth in manufacturing — the most significant driver of trucking activity — has subsided, and residential construction remains stagnant. However, there are some near-term positives, such as lower diesel prices. Also, carriers are responding to flagging demand by ending their hiring spree, which could set the stage for firmer capacity utilization down the road.”

The Trucking Conditions Index tracks the changes representing five major conditions in the U.S. truck market. These conditions are: freight volumes, freight rates, fleet capacity, fuel price, and financing. The individual metrics are combined into a single index that tracks the market conditions that influence fleet behavior. A positive score represents good, optimistic conditions. Conversely, a negative score represents bad, pessimistic conditions. The index tells you the industry’s health at a glance. In life, running a fever is an indication of a health problem. It may not tell you exactly what’s wrong, but it alerts you to look deeper. Similarly, a reading well below zero on the FTR Trucking Conditions Index warns you of a problem, while readings high above zero spell opportunity. Readings near zero are consistent with a neutral operating environment, and double-digit readings (both up or down) are warning signs for significant operating changes.

FTR has served as the industry source for freight transportation forecasting in North America for the shipping, trucking, rail, intermodal, equipment and financial communities for over 30 years.

Our team of experts have over 250 years of combined experience in the transportation industry and leverage that knowledge to provide quantitative analysis with historical and modal-specific insights. The reports, data, commentary, and insights that FTR provides help our clients evaluate market risks, identify new opportunities, and make informed decisions.

For more information about the work of FTR, visit FTRintel.com, follow on Twitter @ftrintel, or call (888) 988-1699, ext. 1.

 

 

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Average on-highway gallon of diesel up 1.6 cents, but crude oil up 12.97%

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The average price of a gallon of on-highway diesel for the week ending September 16 was 28.1 cents lower than the comparable week in 2018. (The Trucker file photo)

WASHINGTON — The average on-highway price of a gallon of diesel rose 1.6 cents a gallon to $2.987 for the week ending September 16, according to the Energy Information Administration of the Department of Energy.

It was the first weekly increase since the week ending July 8 when the price went up 1.3 cents a gallon to $3.055.

What, if any, impact did the attack on the Saudi oil facility have on the price this week is hard to determine since the attack occurred only early last Saturday.

“Our team is keeping a close eye on the impact of the Saudi oil fire on the diesel market,” said a spokesperson for Pilot Flying J. “We have already seen the market react, but it’s too early to predict the extent of the impact. Our No. 1 priority remains getting our guests from point A to point B as quickly and conveniently as possible.”

The price of West Texas Intermediate crude rose 12.97% to $61.93 Monday.

All regions of the country increased with the exception of the Central Atlantic States (New York, Pennsylvania, Maryland, Delaware and New Jersey) where the price dropped nine tenths of a penny to $3.013.

The largest increase was in the West Coast minus California at 3 cents top $3.161. The next largest increase was 2.6 cents in the overall West Coast region (California, Arizona, Nevada, Oregon and Washington) and the Rocky Mountain states (Colorado, Utah, Wyoming, Idaho and Montana.

The price for the week ending September 16 was 28.1 cents lower than the comparable week in 2018.

For a complete list of prices by region for the past three weeks, click here.

 

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DOT’s freight transportation index rises to new all-time high in July

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The Freight TSI measures the month-to-month changes in for-hire freight shipments by mode of transportation in tons and ton-miles, which are combined into one index. (The Trucker file photo)

WASHINGTON — The Freight Transportation Services Index (TSI), which is based on the amount of freight carried by the for-hire transportation industry, rose 0.9% in July from June, rising to a new all-time high after declining for two consecutive months, the Department of Transportation’s Bureau of Transportation Statistics’ (BTS) said Thursday.

From July 2018 to July 2019, the index rose 2.9% compared to a rise of 6.0% from July 2017 to July 2018.

The Freight TSI measures the month-to-month changes in for-hire freight shipments by mode of transportation in tons and ton-miles, which are combined into one index. The index measures the output of the for-hire freight transportation industry and consists of data from for-hire trucking, rail, inland waterways, pipelines and air freight. The TSI is seasonally-adjusted to remove regular seasons from month-to-month comparisons.

The BTS said the Uly increase was broad based with increases in rail carloads, rail intermodal, trucking, pipeline and air freight. There was a small decline in water transportation.

The TSI increase took place against a background of mixed results for other indicators.

The Federal Reserve Board Industrial Production Index declined in July, reflecting decreases in mining and manufacturing and an increase in utilities. Personal income increased by 0.1%, while housing starts declined by 4.0%. The Institute for Supply Management Manufacturing index decreased 0.5 points to 51.2, indicating continued but slowing growth.

The BTS said despite small decreases in both May (-0.1%) and June (-0.3%), the July index was 0.6% over its April level and 0.2% over its previous record high in November 2018.

The record high level was reached even though the index increased in only four of the eight months since November. From a low point in March 2016, the index climbed 12.8% until reaching a new high in May 2018. From that point, the index has exceeded its levels in all months prior to May 2018. The July 2019 index was 46.6% above the April 2009 low during the most recent recession.

For-hire freight shipments in July 2019 (139.0) were 46.6% higher than the low in April 2009 during the recession (94.8). The July 2019 level reached its all-time high.

For-hire freight shipments measured by the index were up 2.1% in July compared to the end of 2018.

For-hire freight shipments are up 15.4% in the five years from July 2014 and are up 41.4% in the 10 years from July 2009.

 

 

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Class 8 sales up in August, but figures indicate forecast slowdown coming

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International has posted the best year-to-gain in Class 8 sales with a 28.9 increase. (Courtesy: NAVISTAR)

SOUTHFIELD, Mich. — It appears that the much-discussed prospective chink in the armor of a two-year upward trend of new Class 8 truck sales is now visible.

Wards Intelligence reported Wednesday that August sales of 23,466 was a 6.7% decline from July’s sales of 25,164, but perhaps more significantly, it marked the first time in the past 25 months that sales had not exceed the figure for the comparable month in the previous year.

The streak began in July 2017 when sales were 8.7% higher than July 2016. July sales in 2019 were 21.9% higher than sales in July 2018.

Still in place is a streak of 20 consecutive months where the year-to-date sales has been higher than the same period the previous year, although that percentage has declined in each of the past three months.

Year-to-date sales of 183,462 in 2019 are up 18.7% over the same period in 2018 when sales had totaled 154,587.

Only two OEMs posted month-over-month gains in August. Volvo sales of 2,563 were 3.1% higher in August when 2,486 units were sold. Cousin Mack Trucks posted a 3% gain over July with sales of 1,773 in 2019 compared to 1,722 in July.

The largest month-over-month decline was 15.1% at Freightliner, although the Daimler Trucks North America product continues to hold the top position in market share at 35.6% with sales of 66,937. The next closest OEM is Peterbilt at 15.1%

As would be expected with year-to-date sales comparisons, all OEMs are ahead of 2018. International leads the parade at 28.9% (sales of 26,635 versus 20,663) followed by cousins Kenworth (21.2%) and Peterbilt (20.3%)

 

 

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