The new edition of the Trucking Conditions Index (TCI), which was published this week by freight transportation consultancy FTR, highlighted how “conditions deteriorated further.”
According to FTR, a TCI reading above zero represents an adequate trucking environment, with readings above 10 indicating that volumes, prices and margin are in a good range for carriers.
For June, the most recent month for which data is available, the TCI came in at -3.36, down from May’s -0.3 reading. FTR said that prior to May and June the TCI had not recorded negative readings in consecutive months since April and May 2020. The firm explained that various factors contributed to these declines, including: negative cost and pricing conditions in June, with freight volume and capacity utilization being weaker positive factors than compared to May.
“We might still see some positive outliers in the TCI—especially if diesel prices continue to fall sharply—but the truck freight market has hit an inflection point,” said Avery Vise, FTR’s vice president of trucking, in a statement. “Modestly negative readings likely will be the norm rather than the exception, although we are not forecasting that the bottom will drop out. We still expect that freight volume will grow slightly this year and next and that capacity utilization will bottom out above the 10-year average. However, this forecast does not presume an economic recession, so downside risks are substantial.”
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