Trucking freight levels should grow consistently
The American Trucking Associations’ (ATA) advance seasonally adjusted (SA) For-Hire Truck Tonnage Index decreased 0.7 percent in April, 2011, after gaining a revised 1.9 percent in March. March’s increase was slightly better than the 1.7 percent ATA reported on April 26, 2011.
The latest drop put the SA index at 114.9 (2000=100) in April, down from the March level of 115.6. The not seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment, equaled 113.6 in April, which was 8 percent below the previous month.
Compared with April 2010, SA tonnage climbed 4.8 percent. In March, the tonnage index was 6.5 percent above a year earlier.
“The drop in April is not a concern. Since freight volumes are so volatile truck tonnage is unlikely to grow every month, even on a seasonally adjusted basis,” ATA Chief Economist Bob Costello says. “I expect economic activity, and with it truck freight levels to grow at a moderate pace in the coming months and quarters.
“The industry, and the economy at large, should benefit from the recent declines in oil and diesel prices. Lower fuel costs will help freight volumes and motor carrier bottom lines going forward.”
Each month, ATA asks its membership the amount of tonnage each carrier hauled, including all types of freight. The indexes are calculated based on those responses. The sample includes an array of trucking companies, ranging from small fleets to multi-billion dollar carriers.
When a company in the sample fails, ATA includes its final month of operation and zeros it out for the following month, with the assumption that the remaining carriers pick up that freight. As a result, it is close to a net wash and does not end up in a false increase. Nevertheless, some carriers are picking up freight from failures and it may have boosted the index. Due to our correction mentioned above however, it should be limited.
ATA says trucking serves as a barometer of the U.S. economy, representing 67.2 percent of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods. Trucks hauled 9 billion tons of freight in 2010. Motor carriers collected $563.4 billion, or 81.2 percent of total revenue earned by all transport modes.
For more information on ATA, visit www.truckline.com.