Photo: Aaron Marsh/Fleet Owner
Sandberg says fleets should consider testing at least two or three ELD systems prior to purchasing them Photo by Aaron MarshFleet Owner

FTR: TCI for November falls to more sustainable level after October spike

Jan. 22, 2018
FTR’s Trucking Conditions Index (TCI) for November fell back from the spike measured in October to a more sustainable level with a 5.8 reading.

FTR’s Trucking Conditions Index (TCI) for November fell back from the spike measured in October to a more sustainable level with a 5.8 reading. Although there was a significant monthly decline in the index, conditions remained strong for carriers in November.

FTR noted that it assumed the spike in October would be short-lived and would likely not be maintained at that level. However, if contract rates are able to sustain their current upward pace, the index in 2018 will be better than the November reading. Freight demand remains strong but, with utilization figures close to 100%, there is not much upside potential to this piece of the index.

Details of the November TCI are found in the January issue of FTR’s Trucking Update, published Dec. 22, 2017. The ‘Notes by the Dashboard Light’ section in the current issue takes a close look at the history of ELD implementation and the forecasted impact of the now implemented mandate. 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.

“With utilization levels fairly close to industry limits, further gains in the TCI are likely to come from either more significant pricing gains or additional freight growth,” according to Jonathan Starks, chief operating officer at FTR. “We are already seeing the pricing effects take hold with more substantial contract rate gains as spot market pricing surged after the hurricanes and during the holidays. Spot markets actually hit record high rates in the last week of 2017 and are starting 2018 at a significantly elevated level. As we move into 2018, the market is poised to see additional freight growth and further limits on capacity as ELDs are fully enforced beginning April 1. The next critical time frame is Q2 when truckload activity ramps up and the full ELD enforcement hits. As the recent Polar Vortex weather demonstrated, any modest change in operating conditions can have an oversized impact on carriers and shippers as the industry operates with very limited (if any) excess capacity.”

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.

Trucking Update, published monthly, is part of FTR’s Freight Focus series and reports data that directly impacts the activity and profitability of truck fleets. As part of the Trucking Update, FTR forecasts expected trends in this data and the probable short and long-term consequences. For more information on how to subscribe to Trucking Update, or other publications within the Freight Focus series, email [email protected] or call (888) 988-1699 ext. 1.

About the Author

Fleet Owner Staff

Our Editorial Team

Kevin Jones, Editorial Director, Commercial Vehicle Group

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