FTR’s Trucking Conditions Index remains in negative territory

While still remaining in negative territory, the most recent edition of the Trucking Conditions Index (TCI) from freight transportation consultancy FTR showed mild improvement.

The TCI reflects tightening conditions for hauling capacity and is comprised of various metrics, including capacity, fuel, bankruptcies, cost of capital and freight.

According to FTR, a TCI reading above zero represents an adequate trucking environment, with readings above 10 indicating that volumes, prices and margin are in a good range for carriers.

For April, the most recent month for which data is available, the TCI came in at -0.64, representing an improvement over March’s -1.18. March represented the first time the TCI turned in a negative reading for the first time “in several” years,” according to FTR.

And it added that while trucking conditions saw a slight sequential improvement, the TCI remains in negative territory as the rate environment continues to soften. FTR also noted that economic conditions linked to freight are generally weaker, with the firm expecting the TCI to remain in a narrow band of negative readings through 2019 and into the 2020 calendar year.

“Not that long ago, it seemed inconceivable that the good times in trucking would end, but here we are back down to Earth,” said Avery Vise, FTR vice president of trucking, in a statement. “Growth in manufacturing – the most significant driver of trucking activity – has subsided, and residential construction remains stagnant. However, there are some near-term positives, such as lower diesel prices. Also, carriers are responding to flagging demand by ending their hiring spree, which could set the stage for firmer capacity utilization down the road.”