The epidemic could have a big potential impact on freight because China’s role in manufacturing is considerably larger now than in 2002-03, when the SARS outbreak hit the country hard, said Avery Vise, FTR’s vice-president for trucking.
Back then, China’s share of global manufacturing was 4%, and now it is 16%, he told a State of Freight webinar.
“A lot of those (consumer) goods may not get produced, may not get shipped (and) may not get bought, depending on how this plays out,” Vise said.
That could have a significant impact on retail sales in North America, he added.
“And, when you look at how it affects transportation, I don’t think it takes a rocket scientist to see that the most immediate impact is going to be on maritime shipping, which then translates into intermodal,” Vise said.
Vise spoke a day after China reported a huge spike in deaths from the coronavirus outbreak.
Beijing said 242 people had died in the province of Hubei on Wednesday, the deadliest day of the outbreak. It also said that another 14,840 people had been diagnosed with the disease, officially known as Covid-19.
That takes the total number of infections to almost 60,000. The Chinese death toll now stands at 1,350.
“This is still an emerging thing. A lot of people are skeptical that we really are getting the full story, or even that anyone even knows the full story at this point,” Vise said.
Referring to the freight market situation, he said the outlook is “pretty flat.” Vise said FTR’s overall growth forecast for truck loadings is 0.7%.
He also said that some of the freight-related indicators, such as housing, retail sales and employment are up, while manufacturing is flat and trade is down.
In fact, Vise said, job creation was accelerating, with unemployment at the lowest level in 50 years.
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