Trucking Conditions Index jumps 56%

Aug. 13, 2015

The Trucking Conditions Index (TCI) for June jumped 56% from May, according to the latest data released by FTR. At 7.66, the TCI is at its highest level of the year.

According to FTR, slower freight growth in the second quarter occurred, but rates are growing and margins remain good. FTR said it expects regulatory conditions and a continued economic recovery to fuel an accelerating index during 2016.

Freight growth should show an overall gain this year, the sixth straight year of annual gains, FTR said. Fuel costs have dropped, but rising labor costs are continuing to pressure rates.

“It was a positive sign for trucking that the index rebounded in June. May was the lowest level in 3 years, but June was the best month so far in 2015,” said Jonathan Starks, director of transportation analysis. “Continued declines in fuel prices during July and August should help to keep the index elevated as the industry prepares for the fall shipping season. The fall peak may not be as strong this year but the economy continues to chug along, and contract rates are still growing versus last year. The spot market has certainly slowed in 2015, relative to a very robust year in 2014. For the last week of July, the Market Demand Index (MDI) from was down over 50% from 2014. Spot rates are also down, but not nearly as dramatically, and half of the decline stems solely from lower fuel prices. The truck market is quite stable at the moment and seems likely to maintain that pace until we get into 2016.”

Details of the June TCI are found in the August issue of FTR’s Trucking Update.

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