FTR’s Trucking Conditions Index unchanged in May

FTR’s Trucking Conditions Index (TCI) for May basically remained unchanged from April at a positive reading of 7.01.

FTR’s Trucking Conditions Index (TCI) for May basically remained unchanged from April at a positive reading of 7.01.

As detailed in the July issue of the Trucking Update, FTR notes that the spot rate market is a strong indicator that conditions for trucking companies are on the upswing with active truck utilization at just below 100%.  Spot market volumes and pricing have been up y/y for several months, although contract market prices are still weak, before fuel adjustments.  The freight environment in 2017 remains strong, although economic conditions are fluctuating enough that freight growth could weaken.  If growth does slow, that may mitigate the potential for critical capacity issues with the onset of ELD implementation at the end of the year.

Details of the May TCI are found in the July issue of FTR’s Trucking Update, published June 30. The “Notes by the Dashboard Light” section in the current issue examines how the degree to which the new electronic logging mandate is enforced will affect overall capacity.

Jonathan Starks, Chief Operating Officer at FTR, commented, “We are now at the beginning of the third quarter of 2017, and spot market pricing is showing solid double-digit increases over last year. It is becoming increasingly clear that the weak pricing in the contract segment cannot be sustained for much longer.

“In reviewing data from the publicly-traded carriers’ first quarter reports, we have seen that there was no notable reduction in the carriers’ underlying costs. That means that rate increases will need to be forthcoming or margin compression will quickly impact their bottom line. The wildcard continues to be the ELD implementation at the end of this year. Capacity has already tightened, and the market will tighten further as full ELD implementation occurs.”
 

 

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish