Trucking Conditions Index unchanged in May

July 15, 2013

FTR Associates’ Trucking Conditions Index (TCI) remained unchanged in May, according to the firm. As reported in the July 2013 Trucking Update, the TCI is 12.4, the same as April.

The TCI reflects a positive environment for trucking, FTR said. The TCI is designed to summarize a full collection of industry metrics, with a reading above zero indicating a generally positive environment for truckers. Readings above 10, as they are now, signal that volumes, prices, and margins are likely to be in a solidly favorable range for trucking companies, FTR said.

The firm said the current TCI level is likely due to the expectations of fleets of rising rates and margins due to tightening capacity conditions, which FTR expects to continue.

“The trucking industry has seemingly been stuck in a holding pattern for the last year or so. Rates have only moved slightly higher and freight growth, while strong at the end of 2012 and early in 2013, has generally been modest,” said Jonathan Starks, director of transportation analysis. “Barring an external change in the marketplace we believe that the HOS changes, in conjunction with the other numerous regulations already implemented or soon to be, will be enough to change the supply and demand equation in favor of the truck fleet. That is why we expect a noticeable uptick in rates by the end of the year. The weaker manufacturing sector has probably limited any chances of seeing a true capacity crisis in 2013 - we need some additional economic growth to envision that possibility.”

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