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FTR’s Trucking Conditions Index Shows Cause for Concern

FTR’s Trucking Conditions Index Shows Cause for Concern

It can be difficult to assess just how the trucking industry as a whole is doing, or to predict how things will turn out for those within the field in a given time period. And while a number of factors can influence truck driving, the Trucking Conditions Index is usually a good indicator of the general state of the field. Issued by the freight transportation forecasting firm FTR, this figure provides insight to the way economic conditions have affected the freight transportation industry.

Fluctuating fuel costs, reduced demand in partner industries, an abundance of regulatory measures, and other factors have all contributed to the change in the index. According to the FTR’s research, the TCI fell almost 50 percent from an 8.27 in February to 4.22. This has been the lowest marking since 2011. Though the plummet was sharp, it doesn’t show anything catastrophic – a reading above zero represents an adequate environment for trucking.

GDP for the first quarter of the year was not as favorable as some would have liked, and this may have contributed substantially to the TCI drop. Many believe that this trend of slow growth and even loss will continue due to HOS and ELD laws taking effect in the coming years. While some believe that continues will continue to worsen, others think that the sharp drop is largely attributed to economic instabilities from the previous year.

Jonathan Starks, Chief Operating Officer at FTR said: “The freight markets have slowed significantly over the last year with March volumes just 1.5 percent above year ago levels… I believe it is a delayed response to the 2015 easing of capacity combined with rising fuel prices that has hurt the contract market this year. Weak rate growth will persist but not at the negative level that we are currently seeing, especially once we hit 2017 and the regulatory pressures begin to increase.

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