Is a hot trucking market cooling off somewhat? It’s a possibility, according to FTR’s Trucking Conditions Index, which fell in October to a reading of 3.17. That number is more than a point lower than September, which had seen a significant dip from August when the TCI measure was in plus double digits, FTR reports.
Stabilizing truckload rates and a short-lived run up in diesel prices were largely responsible for a continued deterioration in trucking conditions during October, the report notes. However, in spite of the fact that the October reading was the lowest since August 2017, FTR’s outlook for trucking conditions looks stronger in the near term, predicting the TCI rebounding to a better level for months to come.
"October’s conditions index confirms the general sense that the current cycle has peaked," said Avery Vise, vice president of trucking, in a release. "Although we anticipate improved conditions for the remainder of 2018 and much of 2019 compared to October, we appear to be headed gradually toward neutral territory."
Details of the October TCI are found in the December issue of FTR’s Trucking Update, published Nov. 30. The Notes by the Dashboard Light section in the current issue discuss the likely return to stability in the trucking market in 2019 after a significant period of extraordinary strength.
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. The index tells you the industry’s health at a glance. In life, running a fever is an indication of a health problem. It may not tell you exactly what’s wrong, but it alerts you to look deeper. Similarly, a reading well below zero on the FTR Trucking Conditions Index warns you of a problem, while readings high above zero spell opportunity. Readings near zero are consistent with a neutral operating environment, and double-digit readings (both up or down) are warning signs for significant operating changes.