The latest release of ACT’s For-Hire Trucking Index, showed August volume flat and productivity down, with the Supply-Demand Balance and capacity rising marginally. Kenny Vieth, president and senior analyst, ACT Research, commented, “While Volume Index flatness m/m reflects the difficult freight environment, August’s number remains above the June/Q2 dip and reflects diminished but wage-supported underlying economic conditions.”
He noted, “Fleet productivity/utilization declined 7.0 points m/m, to 47.6 in August (SA), as the lower volume freight market increases inefficiency. Downward pressure on freight volumes related to inflation and interest rates, recovering equipment production, and still-rising driver populations suggest that fleet utilization is likely to be choppy across coming quarters.”
Regarding supply and demand, Vieth said, “While volumes were up incrementally this month, the reading still reflects a loose trucking market and a late stage in the freight cycle. Freight volumes are not in significant downturn, but have certainly stagnated since Q1, whereas capacity, which always lags the cycle, is still growing. With capacity growth set to continue amid flattish industry volumes, the looser environment is likely to persist, even as volumes ramp into peak freight season in the coming months.”
The ACT Freight Forecast provides forecasts for spot truckload rates by trailer type for four to six quarters and truck volumes and contract rates for three years for the truckload, less-than-truckload and intermodal segments of the transportation industry. In 2019, the average accuracy of the report’s truckload spot rate forecasts was 98%. The ACT Research Freight Forecast uses equipment capacity modeling and the firm’s economics expertise to provide unprecedented visibility for the future of freight rates, helping businesses in transportation and logistics management plan for the future with confidence.