After easing modestly but steadily since April’s record level, FTR’s Trucking Conditions Index (TCI) in August rose slightly to a reading of 11.63. Freight volume and capacity utilization were not quite as favorable for carriers in August as they were in July, but more robust freight rates resulted in stronger overall market conditions. FTR’s TCI forecast remains for strong positive readings well into 2022.
Details of the August TCI are found in the October 2021 issue of FTR’s Trucking Update, published Sept. 30. Also included in the October issue is a discussion of how the proposed vaccine mandate for companies with 100 or more employees might add more fuel to an ongoing capacity shift toward small carriers. Beyond the TCI and additional commentary, the Trucking Update includes data and analysis on load volumes, the capacity environment, rates, and the economy. FTR also publishes ongoing publicly available analysis on the impact of COVID-19 on freight transportation at www.ftrintel.com/coronavirus.
Avery Vise, FTR’s vice president of trucking, commented, “Market conditions in trucking still strongly favor carriers, and we have no real sign of an inflection on the horizon. After healthy – though not especially robust – gains in payroll employment during the summer, trucking job growth was relatively weak in September. Meanwhile, the shift of capacity from larger carriers to startups continues, adding to the supply chain disruptions that are bolstering spot market volume and rates for much longer than we would expect in a ‘normal’ hot market like we saw in 2017 and 2018. Rising diesel prices increase the risks of a swing of capacity back toward larger carriers if spot metrics begin to soften, but we have no indication of that happening yet.”
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 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.