ACT: Omicron delays capacity recovery
The latest release of ACT’s For-Hire Trucking Index, with December 2021 data, showed an increase in the Pricing Index, with slowing in all other categories measured.
“The Driver Availability Index decreased 2.4 points in December, to 35.5 from November’s 37.9, reflecting the impact of the Omicron variant on both absenteeism and recruiting,” said Tim Denoyer, vice president and senior analyst at ACT Research. “Positively, Omicron’s case pattern appears more needle-shaped, and US cases have already begun to fall, so this wave is likely to be short-lived.”
However, he added, “Freight markets remain tight with elevated demand and Omicron impacting driver availability, and ACT’s For-Hire Pricing Index rose 1.7 points, to 72.0 (SA) in December from November’s 70.3.”
Regarding capacity, Denoyer noted, “The Capacity Index decreased 2.9 points in December, and while down from November’s reading, which was a two-year high, it is still significantly above the trend of the past two years. Omicron’s negative impact on driver availability is affecting fleet capacity in the short-term, but, with extraordinary stimulus in the rearview, drivers have started to respond to significant bonuses and wage increases in greater numbers.
“That said, equipment production is still challenged, and the sustainability of the improvement will be interesting to watch in the coming months. Given the major supply challenges, we still anticipate capacity growth to be slow for a while.”
The ACT For-Hire Trucking Index is a monthly survey of for-hire trucking service providers. ACT Research converts responses into diffusion indexes, where the neutral or flat activity level is 50.
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.