Flatbed loadings up 0.4% in June
July 25, 2012
The Flatbed sector was the least impacted by revisions to Q2 data. April loadings were revised modestly higher but May and June were essentially unchanged. As such our forecast is nearly identical to last month’s update. Flatbed loadings were at 7.510 million in June, a gain of 0.4% from May. Year-over-year growth was relatively unchanged, up 3.1% in June.
Flatbed freight was the hardest hit sector during the Great Recession. As manufacturing and housing both toppled, flatbed loadings dropped 19.2% in 2009 alone. And this was on the heels of a 4.2% decline in 2008. Volumes dropped significantly from Q3 of 2008 through Q2 of 2009. Loadings were flat until the start of 2010 and then they rose strongly for the next four quarters, with 2010 growing 5.9%. 2011 started off weak but loadings have been mostly rising since then with full year 2011 improving 7.0%. Year-over-year growth went near zero in October and November, but quickly got back above 4% by the start of 2012. Year-over-year growth has slowed recently but continues to remains strongly positive.
Growth will stay strong but ease back to 5.3% in 2012 and then re-accelerate above 6% in both 2013 and 2014. Freight volumes are still below their pre-recession peak. However, the strong growth starting in 2010 and forecast through 2014 means that we are now likely to get to a new peak by late 2013.
Export reductions, so far, have not impacted this market, and several construction segments (housing and businesses) continue to show improvement.
So far during this recovery the only other trailer segment able to match Flatbed’s growth was the Bulk/Dump market; however, the Bulk segment has been much more volatile in its growth and is looking to ease over the next year. Recently, Dry Van has matched Flatbed’s growth, a surprise given its more muted recovery until now.
Both the Flatbed and Bulk/Dump sectors have performed better than the industry as a whole. Platforms have benefited by strong steel and machinery movements as well as better than expected lumber growth. Both sectors should benefit from the nascent housing recovery.
The main concern for this segment is that changes in the economic climate are likely to impact it more than other markets. If the economy stalls then business investment would likely be heavily reduced. The strong manufacturing sector, and the business investment necessary for that, have driven much of the rebound in this sector. If that investment stalls, then this sector will likely be disproportionately affected. Conversely, if housing and construction improve quicker than anticipated it would have a very positive impact on flatbed demand.
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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