TORONTO, Ont. – The Ontario Trucking Association revealed the results of its fourth quarter 2015 business conditions survey today.

The OTA said that results showed that for the most part, carriers are optimistic the Canadian freight market can withstand current economic conditions. Though, things like the weakness of the Canadian economy and unprecedented rising prices for new equipment appear to have affected carriers, shifting their current and future outlook more significantly than in the recent past.

Despite this, the OTA says 69% of carriers in the survey say they are “generally optimistic” about the prospects for the trucking industry over the next three months – 16% lower than this time last year, but still a large percentage of respondents overall.

Freight Volumes

The OTA claims that Intra-Ontario and Intra-provincial freight volumes showed early signs of cracking in the 2Q2015 survey and that trend is continuing.

The survey showed that 29% of carriers reported volume increases in the previous three months, just above the 25% who saw improvements in the previous survey but still well off the 44% average of carriers who expressed similar sentiments throughout 2014. In addition, 56% report unchanged volumes.

The survey also showed that only 16% of carriers reported improved volumes in which is 20% less than the last quarter and a 43% drop from mid-2014. While the overall majority (60%) still indicate no volume change in this sector, 24% report shrunken volumes – the highest percentage since the midst of the recession in 2009.

Of those surveyed, only 35% of carriers foresee volumes improving over the next six months – down from the 54% who indicated positive expectations in 2Q2015. The number of people who anticipate contracted volumes are still in the single digits, but previous optimism has shifted towards an expectation of stagnancy as 69% predict no changes for at least the next six months.

Rates & Capacity

The OTA said in regards to pricing in Ontario, 20% expect improvements, down from 33% in the last survey and more than half of 45% who this time last year expected pricing to solidify further. Only 10% of carriers expect rates to actually decrease – although that’s 10% more than in the last three surveys when no carrier suggested the industry should brace for softer rates.

Compressed capacity also continues to be an issue, the OTA found. A majority (56%) of carriers report no change in capacity over the last three months, although only 20% say capacity has tightened, which is the lowest level since 4Q2013. Looking ahead, 20% think capacity will increase, another fifth of respondents expect tightening and 60% don’t think there will be any fluctuation.

Carrier Costs

The survey also should that fleets are struggling to keep costs in check. Nearly all respondents said that tractor/engine prices have gone up by at least 10%, while 40% of carriers surveyed said that prices increased 20% or more. Until this year, OTA said that almost no respondents have ever reported engine/tractor costs higher than 20%.

In addition, the survey found that 92% of respondents reported report wage increases in the 2-5% range with nearly one in 10 carriers say they have increased pay by 10%.

Top Concerns

 The top concern according to the carriers surveyed is still the driver shortage with 40% (down from 50%). The second top concern was the economy (27% said it was their top concern) and the third was capacity/rates (23%).