Despite a slip of 4.5 percent in American Trucking Associations' (ATA) truck tonnage index in February, other data points in the freight market continue to signal strength for the North American commercial vehicle market in the months ahead, ACT Research noted Monday in its most recent industry outlook report.
ATA reported in late March that February's drop in seasonally adjusted tonnage after a 1.2 percent uptick in January was potentially the result of severe weather that plagued large swathes of the country. Spot rates faired better that month, and ACT President and Senior Analyst Kenny Vieth says that "from the freight perspective, spot rates continue to post new record levels and are currently inverted relative to contract rates — a clear signal that contract rates will continue to rise."
Additionally, Vieth says low business inventories and backed-up ports on both coasts have created a backlog of freight, providing excellent forward visibility for continued strong demand for freight services.
"From a commercial vehicle demand perspective, orders, from medium-duty trucks to heavy-duty tractors and trailers, remain elevated, and backlogs for tractors and van-type trailers, at current build rates, are beyond 12 months, meaning that overall backlog-to-build ratios extend well beyond traditional ranges."
Supply chain disruptions are and will continue to be a challenge, but its one the market should be able to overcome..
"Our song remains the same: the current business environment for heavy-duty trucks is about as good as any we have seen in 35 years of monitoring heavy-duty market conditions at ACT Research."