Flatbed rates are staying strong
October 5, 2011
Volumes are growing but still remain significantly below pre-recession levels. Despite this the capacity situation is significantly tighter than most markets. As such, flatbed rates continue to stay very strong.
A large reduction in capacity during the downturn combined with a strong industrial recovery to make for a strong rate environment. This led to a very strong Flatbed rates surge during 2010, with Q4 nearly hitting the double-digit mark for year-over-year growth. Rate growth eased to start 2011as we finally started overlapping the recovery time frame. Rate growth looks to have been fairly steady during the second quarter (~5%) but we anticipate a small resurgence as we hit late summer/fall.
Outlook
Flatbed rates dropped over 6% in 2009 after remaining nearly flat for 2008. Pricing quickly came back with almost a 6% gain in 2010. We anticipate seeing flatbed rates rising 6.4% in 2011, 5.0% in 2012, and 7.1% in 2013. If construction of infrastructure or residential housing were to take off stronger than our currently anemic forecast then that would say that there is additional upside to the rates outlook.
NOTE:
Our truckload rates data is based on publically-available data from security analysts and trade organizations. We then forecast the cost and margin elements, factoring in inflation and industry conditions. The figures are for rate-per-loaded-mile, seasonally adjusted and are indexed to 2003Q1.
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