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FTR’s Trucking Conditions Index positive for July

Sept. 10, 2020
FTR expects the TCI to stay in positive territory through the balance of the year and into 2021.

FTR’s Trucking Conditions Index (TCI) for July at 2.84 was down from the previous month’s 11.35 reading, but trucking conditions remain favorable for carriers as the recovery continues. Carriers took advantage of stronger freight rates while the freight demand and capacity utilization that set the stage for those rates settled somewhat during the month. FTR expects the TCI to stay in positive territory through the balance of the year and into 2021.

Details of the July TCI are found in the September issue of FTR’s Trucking Update, published August 31. Additional commentary analyzes the risks to the freight market from inventories-to-sales ratio disparities in the supply chain resulting from the COVID-19 pandemic. Beyond the TCI and the commentary, the Trucking Update includes data and analysis on load volumes, the capacity environment, and rates. FTR also publishes ongoing publicly available analysis on the impact of COVID-19 on freight transportation at FTR’s COVID-19 intelligence.

“The rebound we saw in June took a bit of a breather in July, but the surge yielded higher spot rates,” said Avery Vise, vice president of trucking, FTR. “Spot volumes and rates were stronger in August, and imbalance is at record levels. The near-term outlook remains favorable for carriers, but we could see some stabilization soon. Record low retail inventories relative to sales likely are a big driver of freight demand, and August employment data showed the first real signs that significant capacity is returning.”

The TCI tracks the changes representing five major conditions in the U.S. truck market. These conditions are: freight volumes, freight rates, fleet capacity, fuel price, and financing. 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.