Fleet Management

Trucking Conditions Index Declines, Further Drops Expected

November 12, 2015

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Source: FTR
Source: FTR

The FTR Trucking Conditions Index declined from the previous month’s number to a reading of 8.46 in September. The reading in August was the highest of 2015 so far. 

The TCI has fluctuated all year long and FTR expects it to decline further by the end of the year. The research and analysis firm said that there has been decent freight growth and lower-- but still good-- capacity utilization, which has kept the trucking environment in a fragile equilibrium.

“While overall capacity is relatively tight, there is a dichotomy between what is seen in the contract potion versus the spot market,” said Jonathan Starks, director of transportation analysis at FTR. “As supply has increased relative to demand, loads have moved back to the contract and dedicated markets that ran out of excess capacity in 2014 due to regulations and weather.”

Price growth in 2015 has been modest so far, but FTR projects a more positive TCI in 2016 that will reflect expected rate increases later in the year.

“The market is relatively stable,” said Starks. “If slow growth in the economy continues, the next significant change in market conditions isn’t expected until fleets start implementing the coming regulations. That is likely to occur in the second half of 2016.”

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