Freight volumes drive both transportation capacity and rates and have witnessed considerable swings in recent years. From the start of the third quarter of 2003 to about the mid-point of 2006, a stron...
Freight volumes drive both transportation capacity and rates and have witnessed considerable swings in recent years. From the start of the third quarter of 2003 to about the mid-point of 2006, a strong North American economy saw basically six in 10 Canadian shippers boosting their freight volumes on an annual basis. More importantly, many Canadian shippers were reporting double-digit increases in their annual freight volumes, particularly those based in western Canada.
But the current drop-off in business for motor carriers actually dates back to 2006, when our research noted the freight market starting to cool.
Initially much of that had to do with goods manufactured in eastern Canada finding a tougher time securing buyers in the US, thanks to the high value of the Canadian dollar. And there were positive signals, such as the fact the western Canada economy, although it was cooling, was not experiencing the difficulties of central Canada; the Canadian housing market was not built on the speculative bubble that doomed the US economy; and the fact that both the Canadian government and Canadian business were on much better economic footing than they were during the last economic downturn.
But the deterioration in shipment volumes is now considerably more widespread. Whereas in 2004, 71% of respondents to our annual shipper survey reported their shipment levels had increased over the previous year, in 2008, this level had dropped to 43%.
Freight volumes are just one of several factors affecting motor carriers for which we maintain historical information. Comprehensive data on rates, surcharges, capacity, length of contracts, modal preferences and more is now available through our Inside the Numbers annual report. The report is available for purchase online at www.trucknews.com.
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