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ACT Research: For-hire market takes small step towards balance

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ACT Research: For-hire market takes small step towards balance
For-hire market sees slight shift in November, according to Act Research.

COLUMBUS, Ind. – The latest release of ACT’s For-Hire Trucking Index continues to suggest growth is making its way into the for-hire market.

ACT For-Hire Trucking Index Volumes November 2024The Volume Index decreased 4.9 points in November to 52.0, seasonally adjusted (SA), from 56.9 in October.

“The spike last month was likely caused by a surge in demand following hurricanes and the brief ILA port strike, but overall, the US economy remains resilient, and freight For-Hire Fleet Capacity December 2024volumes are growing,”said Carter Vieth, Research Associate at ACT Research. “Consumers continue to buoy the economy, and for the first time in six quarters, retailers’ inventories are starting to outpace sales after considerable destocking. The looming ILA strike in January and threat of tariffs are likely to pull freight forward, but opaqueness regarding the timing and scale of tariffs may reduce the amount of pre-tariff shipping. While For-Hire Supply Demand Balance December 2024the retail sector is healthy, interest rate sensitive sectors like manufacturing and construction are sluggish. Continued tight financial conditions are likely to slow some volume improvement.”

The Capacity Index rose 0.3 points m/m to 50.0 in November, from 49.7 in October.

“After two years of weak profitability, for-hire carriers aren’t in the position to add significant new capacity,” Vieth said. “Given the current volume and rate environment, we would anticipate for-hire capacity additions to remain at replacement levels, leaving the index at around current levels.”

The Supply-Demand Balance grew more slowly in November to 52.0 (SA), from 57.2 in October, as freight volumes decreased and fleet capacity inched higher.

“Private fleet expansion, which is not captured in this indicator, has resulted in a longer period with the market close to balance than in past cycles. Disinflation and lower interest rates will support the consumer outlook, as rising goods demand and a turning inventory cycle have resulted in improved import volumes. Private fleets are handling an increased share of volumes, which has been the sticking point keeping the for-hire market from turning up. A slowdown in private fleet growth is necessary for further improvement in the for-hire market balance,” Vieth said.

Dana Guthrie

Dana Guthrie is an award-winning journalist who has been featured in multiple newspapers, books and magazines across the globe. She is currently based in the Atlanta, Georgia, area.

Avatar for Dana Guthrie
Dana Guthrie is an award-winning journalist who has been featured in multiple newspapers, books and magazines across the globe. She is currently based in the Atlanta, Georgia, area.
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