Sharp increases in fuel and financing costs coupled with an unfavorable trend in freight rates resulted in a major deterioration of financial conditions for trucking companies during October, according to FTR.

FTR’s Trucking Conditions Index fell to a -11.16 reading from the -2.35 reported in September. The October TCI was the weakest since the all-time low reading of -28.66 in April 2020.

“We do not see a month on the horizon as difficult as October was for trucking companies, but nor do we expect much for carriers to get excited about," Avery Vise, FTR’s vice president of trucking, said. "The rate environment looks to keep market conditions at least mildly negative into 2024. Plunging diesel prices obviously are bolstering financial conditions in the near term, and the hit from financing costs likely will begin moderating by mid-2023. Those costs have disproportionately hurt smaller carriers recently, and improvements in those situations likewise will not help larger carriers as much as smaller ones.”

The TCI tracks the changes representing five major conditions in the U.S. truck market. These conditions are: freight volumes, freight rates, fleet capacity, fuel prices, and financing costs. 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.