FTR reported this week its Trucking Conditions Index for June stayed in positive territory in June but was down from May's reading.
FTR says its index was 0.95 in June, down from 2.24 in May. But even with the downward slip, the company states core freight dynamics improved for trucking companies during June. Higher financing costs and a slowing of diesel price decreases offset the positive core dynamics.
Moving forward, FTR expects general improvement in market conditions for carriers, but the TCI could see both positive and negative readings in the coming months before the index turns consistently positive by the end of this year.
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“Today’s market might feel as weak as it has been, but we continue to see a growing foundation for a recovery in financial conditions for trucking companies. Strengthening capacity utilization sets the stage for firmer freight rates starting late this year and accelerating somewhat in 2025. Although nothing approaching the likes of 2021 is on the horizon, carriers should be seeing considerably more favorable conditions by next spring,” says Avery Vise, FTR’s vice president of trucking.
FTR notes its TCI tracks the changes representing five major conditions in the U.S. truck market. These conditions are: freight volumes, freight rates, fleet capacity, fuel prices, and financing costs. The individual metrics are combined into a single index indicating the industry’s overall health. A positive score represents good, optimistic conditions. Conversely, a negative score represents bad, pessimistic conditions. Readings near zero are consistent with a neutral operating environment, and double-digit readings in either direction suggest significant operating changes are likely, the company says.
