ECONOMIC WATCH: Consumer spending causing ‘unprecedented’ rate increases
COLUMBUS, Ind. – ACT Research has reported favorable rates and volumes for carriers, as consumers turn their attention to spending on goods rather than services.
“The substitution of spending to goods and away from services is driving a recovery in freight demand and, coupled with slow capacity re-engagement, has led to unprecedented rate increases,” said Tim Denoyer, ACT’s vice-president and senior analyst.
“We expect the truckload market to rebalance over the course of 2021, as drivers gradually return and with substitution back to services once a vaccine is available. But we don’t see a big loosening as recoveries in housing and industrial should support freight demand.”
The positive demand is driving orders for new equipment, but not adding capacity, ACT reported in its ACT Freight Forecast, U.S. Rate and Volume Outlook report.
“The Class 8 tractor fleet is like a big ship, which takes time to turn,” Denoyer said. “As a result of the 2020 supply shock, even with aggressive production growth forecasts, fleet growth still looks muted next year.”
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The problem in Ontario is the hard insurance market. Also many trucking companies still have to pay over 7 percent for money
Many smaller trucking companies and owner ops went out of business with low freight rates this spring and last winter. Until the Ford gov helps with insurance for new truck , bus and wheelchair taxi drivers for small fleets. People will continue to work at other places. We need hourly pay at a fair hourly rate and more medical care and parking.