ACT’s For-Hire Trucking Index for June data is showing continued improvement, rising to 70.4 in June. This is a huge improvement from April’s 19.3 and even the jump to 50.2 a month earlier in May.
Capacity, on the other hand, has remained stagnant, floating around 50.
“The survey confirmed much of what we witnessed in rate data over the course of June, as the supply-demand balance tipped in truckers’ favor as the economy reopened,” said Kenny Vieth, ACT Research’s president and senior analyst. “While encouraging, we would note some transitory risks, one being the economic strength in May and June was heavily subsidized by Congress and the Federal Reserve.
June’s improved rates probably benefited from parked trucks and the number of laid-off drivers, according to Vieth. The rebound from April’s low freight volumes “underscores the rapid move in freight rates,” he added, “as the market moved from too little to too much freight relative to available capacity. The path on rates from here will be largely determined by the economy’s ability to hold the line on freight volumes.”
Vieth overall picture of the industry see a correlation between the decrease in Class 8 retail sales which would cause equipment capacity to continue to tighten.
“But with sidelined drivers likely returning and lenders extending loans, it may be a while before the market tightens structurally. The road back might be a long one,” he concluded.