Freight Forecast: Lowering Truckload Spot Rate Forecasts on Freight Demand; What Could Drive Rates Up in 2020?

ACT Research released the December installment of the ACT Freight Forecast, U.S. Rate and Volume OUTLOOK report covering the truckload, intermodal, LTL and last mile sectors.

The ACT Freight Forecast provides three-year forecasts for volumes and contract rates for the truckload, less-than-truckload and intermodal segments of the transportation industry, and for the truckload spot market, the report forecasts the next twelve months. The Freight Forecast provides unmatched detail on the future of freight rates, helping businesses across the supply chain plan for the future with greater certainty.

Tim Denoyer, ACT Research’s Vice President and Senior Analyst, said, “This is the largest year-over-year drop in container imports since the Great Recession, aside from holiday timing. While partly due to the comparison against pre-tariff inventory building last year, we see evidence that trade issues will continue to drag the freight cycle through the mud. We’ve been forecasting a lengthy freight recession, but October imports, down 8% year-over-year, and Q4 rail volumes, down 7% year-over-year, are missing low expectations. In addition to a turn for the worse in our Spot Leading Indicator, this led us to modestly lower our spot rate forecasts for the first half of 2020.”

ACT Research also lowered Class 8 tractor sales forecasts today, supporting the beginning of the bottoming process for truckload rates, and this month’s report provides analysis of the factors that could pull forward the eventual rate recovery, from both a spot and a contract perspective.

He continued, “We expect capacity to rebalance over the course of 2020, but we caution not to jump to the conclusion that capacity is tightening because of carrier failures. While our thoughts go out to the affected employees, even the largest bankruptcy in truckload history this week accounts for just 0.2% of the active fleet, or about 3% of the Class 8 tractor capacity that was added over the past year, and the equipment will be remarketed.”

ACT Research is recognized as the leading publisher of commercial vehicle truck, trailer, and bus industry data, market analysis and forecasts for the North America and China markets. ACT’s analytical services are used by all major North American truck and trailer manufacturers and their suppliers, as well as banking and investment companies. ACT Research is a contributor to the Blue Chip Economic Indicators and a member of the Wall Street Journal Economic Forecast Panel. ACT Research executives have received peer recognition, including election to the Board of Directors of the National Association for Business Economics, appointment as Consulting Economist to the National Private Truck Council, and the Lawrence R. Klein Award for Blue Chip Economic Indicators’ Most Accurate Economic Forecast over a four-year period. ACT Research senior staff members have earned accolades including Chicago Federal Reserve Automotive Outlook Symposium Best Overall Forecast, Wall Street Journal Top Economic Outlook, and USA Today Top 10 Economic Forecasters. More information can be found at www.actresearch.net.

ACT’s 62nd seminar is scheduled for February 11–13, 2020, and will feature trucker, electrification, and economic panels, as well as discussions on near-term demand of North American commercial vehicle markets and the pending impact of electrification on the market in the near future. A commercial vehicle database workshop is also being planned in conjunction with this semi-annual event. Click here for seminar information.

For more information about ACT’s Freight Forecast, U.S. Rate and Volume OUTLOOK, please click here.

Click here for information about ACT’s freight-related databases.

ACT Research is the leader in commercial vehicle industry data, market analysis, and forecasting services for North America.

ACT Research is the leader in commercial vehicle industry data, market analysis, and forecasting services for North America.