Trucking’s economic activity should maintain its growth through this year as the overall economy continues its expansion, Bob Dieli, president and founder of RDLB Inc., said at the Heavy Duty Aftermarket Dialog in Las Vegas.
While admitting “they call them surprises for a reason,” Dieli reassured a group of industry suppliers that “the risks of a recession are quite low, especially in the near future.”
Dieli identified five major components in the overall economy that create what he calls “truckable economic activity”: consumption, investment, exports, imports and government. And all five should “see a fairly steady expansion this year,” he predicted.
Leading that growth will be strong import and export activity, both of which require trucks, Dieli said. By his estimate, the two now account for almost 25% of all truckable economic activity, compared to 19.5% in the decade of the 2000s and 17.5% in the 1990s. The growth of foreign trade is one of the recent key structural changes to the economy “that will be with us for a long time,” he said.
Driven by income and employment growth, overall goods consumption will also be a strong factor in improved trucking industry performance, Dieli said. He estimated that it now accounts for almost 45% of trucking economic activity, compared to just over 40% in the 2000s.
Also auguring in favor of continued growth for trucking are the new federal budget agreement and new leadership at the Federal Reserve, both of which argue against any unsettling changes in fiscal or monetary policy, he said.
Turning to more specific industry topics, Dieli pointed out that the average age of U.S. Class 8 trucks is now at an historic high of almost 10 years and is likely to go even higher. Not only is the quality of heavy-duty trucks better, but as the record numbers sold just before the recession continue to age, “arithmetic says even strong sales of new trucks [this year] won’t be enough to bend the curve down,” he said.