COLUMBUS, Ind. – The latest release of ACT’s For-Hire Trucking Index suggests growth is making its way into the for-hire market.
The Volume Index decreased 5.0 points in September to 49.5, seasonally adjusted (SA), from 54.5 in August.
“Overall, freight demand is growing, but private fleet growth is still resulting in choppy for-hire demand conditions,” said Carter Vieth, research associate at ACT Research. “Durable goods consumption rose 4.2% q/q SAAR in Q2, imports and inventories are growing, and cross-border shipments are increasing. But inconsistency may persist in the near term following two large hurricanes, a port strike, and likely another one in January. With private fleet costs well above for-hire carriers, we expect shippers to eventually shift freight back to the for-hire market, as low orders suggest is starting to take shape.”
The Capacity Index increased by 3.2 points m/m to 50.8 in September, from 47.6 in August.
“This month’s reading marks the first time in fourteen months that capacity has expanded, albeit just slightly,” Vieth said. “This month’s uptick likely reflects the more stable demand and rate environment, which no longer necessarily signal further retrenchment.”
The Supply-Demand Balance decreased in September to 48.8, from 56.9 in August, as freight volumes decreased and fleet capacity increased.
“Private fleet expansion, which is not captured in this indicator, is resulting in a longer period with the market close to balance than in past cycles,” Vieth said. “Despite the past few months of elevated tractor sales due to mirror supply chain issues in April, slowing US Class 8 tractor sales from here will help to further rebalance and move the cycle forward, albeit slowly. Continued strong US economic growth is leading to improved goods demand and will make its way to the for-hire market as private fleet growth slows.”
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.
