Flatbed rates stay strong to start 2012
April 25, 2012
Flatbed rates are showing some of the most resilient pricing in the industry. Since September 2010, the year-over-year rate environment has been at or above 6% every month except one. In January it came in right at 6%. It has a very good chance of maintaining that streak during 2012. The capacity situation in the Flatbed market 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 2011 as we finally started overlapping the recovery time frame, but still remained at the 6% mark. Growth returned at the end of 2011 and is likely to continue.
Outlook
Flatbed rates dropped over 6% in 2009 after remaining nearly flat for 2008. Pricing quickly came back with a 5.6% gain in 2010 and a further increase of 6.9% in 2011. We expect that Flatbed rates will be able to maintain this pace in 2012 and 2013 before accelerating in 2014. We are forecasting growth of 6.5% in 2012, 7.2% in 2013, and 8.9% in 2014. If construction of infrastructure or residential housing were to take off stronger than our current forecast assumes 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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