FTR’s Trucking Conditions Index fell back nearly two points in May to a new reading of -2.3. The TCI has been in negative territory since March and reflects a general weakness in conditions affecting carriers. The outlook is for relative stability through the year with the possibility of some slightly positive readings month-to-month during the period.
The May TCI reading was primarily brought down by the softening rate environment. Freight demand was the only positive contributor in the May measure, albeit not a particularly strong one.
Details of the May TCI are found in the July issue of FTR’s Trucking Update, published June 28. The ‘Notes by the Dashboard Light’ section in the current issue includes an analysis of spot market truck availability. Along with the TCI and ‘Notes by the Dashboard Light,’ the Trucking Update includes data and analysis on load volumes, the capacity environment, rates, costs, and the truck driver situation.
Avery Vise, vice president of trucking, commented, “Although we have dropped from double-digit TCI readings to negative readings in less than a year, we believe the outlook for the rest of 2019 generally is for stability close to neutral conditions. It’s also important to recognize that most of the weakness is in the industrial sector, so trucking activity related to consumer demand should be relatively stronger than the rest of the industry.”
The Trucking Conditions Index tracks the changes representing five major conditions in the U.S. truck market. These conditions are: freight volumes, freight rates, fleet capacity, fuel price, and financing. The individual metrics are combined into a single index that tracks the market conditions that influence fleet behavior. A positive score represents good, optimistic conditions. Conversely, a negative score represents bad, pessimistic conditions. The index tells you the industry’s health at a glance. In life, running a fever is an indication of a health problem. It may not tell you exactly what’s wrong, but it alerts you to look deeper. Similarly, a reading well below zero on the FTR Trucking Conditions Index warns you of a problem, while readings high above zero spell opportunity. Readings near zero are consistent with a neutral operating environment, and double-digit readings (both up or down) are warning signs for significant operating changes.
In addition to the Trucking Conditions Index, FTR has recently started releasing a weekly Trucking Market Update on the State of Freight Podcast. The weekly update is provided by FTR’s Vice President of Trucking, Avery Vise, and covers industry news and key indicators on a more frequent basis. To listen to recent episodes and download the indicators that are covered, go to www.FTRintel.com/podcast.
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