FTR’s Trucking Conditions Index fell nearly two points from November 2020 to December 2020, due to higher diesel prices.
The TCI dropped to a reading of 8.51 from the 10.46 reading in November, even though index components related to freight demand, rates and capacity utilization were slightly stronger.
The fuel cost component of the index recorded its largest negative change in more than three years. FTR forecasts index readings in the high positive single digits through 2021.
“Although the broader economy hit some soft spots as 2020 closed, freight demand remains robust,” Avery Vise, FTR’s vice president of trucking, said in a press release. “Key metrics of the pandemic have improved sharply since the middle of January, and people are getting vaccines. The latest round of stimulus should at least maintain a floor on consumer spending, and the industrial sector continues to recover steadily.”
Even if freight demand were to stall, though, unusual constraints on the supply of drivers likely will prolong tight capacity, Vise said.
“We expect a noticeable loosening as the pandemic fades and millions of Americans rejoin the labor pool,” Vise said. “However, pandemic-related constraints on training and licensing of new commercial drivers have limited the driver pool and will impede a rapid return of capacity. Also, the drug and alcohol clearinghouse already has removed more than 45,000 drivers, and that number rises each day.”
The TCI tracks the changes representing five major conditions in the U.S. truck market: freight volumes, freight rates, fleet capacity, fuel price and financing. The individual metrics are combined into a single index indicating the industry’s overall health. A positive score represents good, optimistic conditions. Conversely, a negative score represents bad, pessimistic conditions. Readings near zero are consistent with a neutral operating environment, and double-digit readings in either direction suggest significant operating changes are likely.