FTR’s Trucking Conditions Index (TCI) for October, at 9.48, spiked upward from the previous month’s 3.5 reading.
A strong economy, combined with pressure from hurricane recovery and the ELD mandate, is creating a very tight market, resulting in improved contract rates. Although at a high level, the TCI has further upside potential during the first half of 2018. This will likely be followed by softening in industry conditions in the second half of 2018 due to slower freight growth, albeit still equating to solid conditions for carriers.
Details of the October TCI are found in the December issue of FTR’s Trucking Update, published November 30, 2017. The “Notes by the Dashboard Light” section in the current issue discusses the expectations for a healthy Class 8 equipment market in 2018. The Trucking Update includes data and analysis on load volumes, the capacity environment, rates, costs, and the truck driver situation.
Jonathan Starks, Chief Operating Officer at FTR, commented, “The TCI is nearing a double-digit number, which indicates that there are big opportunities for carriers with regard to both rates and the loads they choose to carry. Of course, there are still quite a few ‘ifs’ in the near future. If the economy can continue to grow at around a 3% rate in Q4 and 2018Q1, we will see freight demand maxing out any excess capacity. If the ELD implementation and enforcement stay on track, the spring will bring capacity utilization over 100% and the freight transportation market will be scrambling to align loads and trucks. If severe winter weather comes into play, transportation managers will be facing their toughest year since 2004. Carriers should be prepared for big changes, and big opportunities.”