A monthly index of trucking conditions published since 1992 by consultancy FTR hit an all-time high in February, adding further evidence to what some believe is a one-for-the-ages economic scenario for the industry.
The February reading of 15.41 was a 4-point jump over January's levels, which were already very strong. To put February's numbers in context, a zero reading indicates that truck supply and demand are roughly in balance. Positive readings mean strong conditions for carriers and, conversely, a tough market for shippers. FTR also publishes a monthly index that tracks conditions for shippers.
FTR said the current conditions are likely to last at least through the second quarter, which is seasonally a strong period for trucking as warmer weather leads to more construction activity and, by extension, shipping. The first-quarter figures are remarkable in that the period is historically soft for freight demand.
Noel Perry, an economist who has been around trucking since 1976, said last week at the Transportation Intermediaries Association's (TIA) annual conference in Palm Desert, Calif. that the environment is the strongest he's seen in the past 50 years.
"For carriers, there is a feeling of 'Let the Good Times Roll,' and the data is backing that up," FTR COO Jonathan Starks said in a statement. Starks expects the growth surge to moderate in the second half of the year as freight demand decelerates and more equipment hits the market. Perry, for his part, expects cloudier skies more in 2019 and into 2020 as an economic recession becomes more likely and freight demand slows considerably.
The index tracks changes in the five major conditions in the U.S. truck market: Volumes, 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.