Truck loadings up, outlook modest
March 29, 2012
The economic mix is once again positive for transport, with strong increases in auto and some recovery in housing. After a downwardly revised decline of 1.0% in January, month-over-month loadings rose 0.4% in February. The year-over-year growth was flat for the first part of Q4 before improving in December to 2.1%. Growth fell in January to just 1.3%. February saw improvement to 2.1%. We anticipate seeing it bounce between 3% and 5% for most of 2012.
Truck volumes dropped throughout 2009, bottoming out in Q4 at 157.7 million loadings. After seeing strong gains during 2010, particularly Q2, volumes were essentially flat for the first half of 2011 before starting to tick up in Q3 and Q4. Fourth quarter volumes were revised slightly down and ended the year with no quarter-over-quarter growth. While a slight disappointment it only has a small near-term impact in our outlook.
After dropping 2.1% in 2007, loadings fell 5.9% in 2008 and plummeted 11.3% in 2009. We rebounded to grow 3.3% in both 2010 and 2011. Our outlook for 2012 is slightly reduced this month, but still strong at 3.4%. The reduction stems entirely from the Q4 and January revisions that moved the volume projections slightly lower to start the year. Our forecasts for 2013 and 2014 are nearly unchanged from a volume perspective, but show slightly stronger growth of 4.3% in 2013 and 4.4% in 2014. Just remember that the farther we get away from the last recession, the closer we get to the next one. We don’t attempt to forecast when the market MIGHT turn down. We’ll leave that to the political prognosticators.
Truck loadings will climb into clearly positive territory in 2012, with quarterly growth rates above 4% (annualized). The key story in this recovery’s freight growth is the mix of the economy. In 2010 that mix was very positive for freight creating growth rates three times that of GDP. With the slowdown in economic growth in 2011 that mix turned negative with freight growth trailing the anemic GDP growth.
With the modest recovery in overall activity this year that mix has turned positive again. Although we do not expect the 3 times multiplier in 2012, freight growth above 4% for the year is highly likely. This will be enough to put more pressure on the modest tightness already in the market.
U.S. Truck Loadings is the estimated number of truck loads originated in the United States plus truck loads that come to U.S. destinations from Mexico and Canada. It is tons divided by the average tons per truck. FTR’s data is seasonally adjusted and measures both short and long-haul OTR segments.
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