COLUMBUS, Ind. — The latest release of ACT Research’s For-Hire Trucking Index indicated the supply and demand balance fell as freight volumes decreased and capacity increased.
“While spot load postings were strong in March, this is consistent with ongoing softness in the Cass Freight Index,” said Carter Vieth, research analyst at ACT. “The weak reading in our survey, may be related to the later timing of the Chinese New Year this year, creating some sub-seasonality effects from February to March. Additionally, while inventory has been pulled ahead, uncertainty may be causing businesses to sit on inventory longer than usual, as they take a wait-and-see approach to current proceedings. Freight volumes will likely remain choppy as pre-tariff inventories are drawn down.”
The Volume Index
The Volume Index dropped 4.5 points in March to 43.6, seasonally adjusted (SA), from 48.1 in February.
The Capacity Index
The Capacity Index increased 4.0 points m/m to 51.1 in March, from 47.1 in February.
“Steel and aluminum tariffs, reciprocal tariffs, and tariffs on China will directly add to the cost of tractors and trailers,” Vieth said. “The increase in for-hire capacity in March was likely fleets planning ahead of equipment price increases. While freight fundamentals don’t yet call for for-hire capacity expansion, the inflationary cost of tariffs may lead some carriers to pull deliveries ahead. Many, though, have taken a wait and see approach to capital spending.”
The Supply-Demand Balance
The Supply-Demand Balance fell in March, at 42.4 (SA), from 51.1 in February, as freight volumes decreased and capacity increased.
“With Chinese New Year occurring later this year, volumes may have underperformed seasonality on calendar effects,” Vieth said. “Capacity in March was likely temporary, with carriers looking to get ahead of equipment price increases. While capacity is beginning to come out of the supply side, the trade war may significantly impact demand.”
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