Home Truck News Economic Trucking Trends: 3PLs report freight declines are leveling off - Truck...

Economic Trucking Trends: 3PLs report freight declines are leveling off – Truck News

The Transportation Intermediaries Association (TIA), representing 3PLs, has produced a report that predicts continued tough conditions through this year but offers reason for optimism in 2024.

TIA’s 3PL Market Report found freight volumes grew a modest 0.5% in the first quarter, halting a string of quarter-over-quarter declines that began in 2022. The association expects weak freight conditions to persist this year with a return to growth next year.

warehouse loading trailer
(Photo: iStock)

“Data from the first quarter of 2023 indicates the decline in freight volumes we saw at the end of last year has leveled off,” said TIA president and CEO Anne Reinke. “While the freight economy may not grow significantly until 2024, the total economy shows resilience, and our members continue to outperform their non-member peers in key metrics.” 

TIA says its members saw significant year-over-year declines in shipments, revenue, and invoice amount per shipment during the quarter. But we must always remember these were tough year-ago comparisons; quarter-over-quarter drop offs were more modest.

Truckload decreases were greater than those of LTL shipments, while intermodal was flat.

“Though conditions remain weakened for the freight economy, the first quarter of 2023 was relatively steady,” said Mark Christos, TIA board chairman.

The report also found there is currently high driver capacity, with an active driver population in the U.S. about 18% higher than it was immediately prior to the pandemic.

Spot rates mixed

The week ended May 26 showed an increase in overall spot market rates, but that’s fairly typical following International Roadcheck, when many truckers who may lack the confidence to live up to CVSA inspection scrutiny park the truck and find something else to do for the week, resulting in a downward capacity blip.

FTR and Truckstop reported “modest” increases for dry van and flatbed rates for the week following Roadcheck, while refrigerated spot market rates retreated slightly.

Volumes decline across the board, Truckstop reported.

Aftermarket parts demand slowing

Fleets are finally getting the equipment they’ve been desperately waiting for, following a couple years of production disruptions and supply chain snags. That’s showing up in decreasing demand for aftermarket parts, according to CMVC’s Parks Aftermarket Sales Leading Indicator (PLI) index.

aftermarket parts demand chart

The index declined for the seventh consecutive month in April, but the rate of decreases slowed to -0.2% from an average of -0.7% over the previous six months.

“The downward trend in PLI is signaling slowing growth in parts aftermarket sales in the coming months.  The rate at which the truck population is depreciating is within a normal range, so an expanding truck population is supporting higher parts aftermarket sales, but the rate at which the truck population is depreciating is decelerating, causing the growth rates of parts aftermarket sales to slow,” said Chris Brady, president of CMVC.

“The slowdown in the decline in PLI in April may be signaling [that] the deceleration in the growth rate of parts aftermarket sales is stabilizing in the near future. However, it is too early to draw conclusions after only one [month’s] data point. The risks to the parts aftermarket sales outlook remains on the downside, as risks of a recession in the medium term remain elevated.”


Credit: Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Must Read

Volvo already sees signs of pre-buy activity as truck market poised to strengthen – Truck News

Volvo Trucks North America (VTNA) is already seeing signs of a pre-buy,...

PMTC names Scarselli its dispatcher of the year, introduces new drivers to hall of fame – Truck News

Private Motor Truck Council of Canada (PMTC) has inducted four truckers into...

Peterbilt delivers 1,000th Model 589 – Truck News

Peterbilt recently celebrated the delivery of the 1,000th Model 589 to Mike...

HTEC to deploy 100 hydrogen fuel-cell-electric trucks in B.C. – Truck News

The HTEC H2 Gateway Program will see 100 hydrogen fuel-cell-electric trucks deployed...

Transportation technology, offshoring, among keys to success: Heather Devine – Truck News

Heather Devine, the chief legal officer of Traffix, left little doubt about...