Trucking to remain “relatively stable” through 2016: FTR

by Truck News

BLOOMINGTON, Ind. — FTR’s Trucking Conditions Index rose two points to 10.88 in December, reflecting stable conditions for carriers.

The stable operating environment reflected in the index is expected to remain through 2016, FTR reports, describing the rest of this year as one of “placid conditions” for trucking companies in the US. Capacity is expected to remain tight, but adequate, FTR predicts.

However, the industry forecaster also warned two conditions could restrict capacity and lead to rate increases: if the FMCSA reinstates currently suspended hours-of-service changes and if weather shocks to truck productivity turn out to be greater than anticipated.

FTR forecasts US truck loadings will increase 3% this year.

“The trucking environment is still quite healthy. There is no doubt that growth has slowed for certain segments, and there are increasing uncertainties surrounding growth prospects for the US economy. However, contract rates are still rising, albeit slowly, and there is very little capacity that is exiting the system,” said Jonathan Starks, chief operating officer at FTR.

“You can see this in the truck failures figures that are reported by Avondale Partners as they sat near historic lows throughout 2015. Falling fuel is clearly helping cash flow for small carriers, but declining spot market rates are negating some of that improvement. Overall, the trucking industry seems to be in a relatively stable environment as we move into 2016.”

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