Trucking Continues to Move Forward with Cautious Optimism
The fourth-quarter Transport Capital Partners (TCP) survey finds carriers remaining positive, despite tempered expectations, and looking toward stable growth in 2016.
Undeterred by continuing volatility around the world, the United States economy will likely continue its steady upward climb in 2016. And, as is often the case, the trucking industry presents us with an accurate mirror to movements in the economy at large.
Economic events in the 4th quarter of 2015 left expectations at their lowest levels in over 5 years. However, motor carrier executives remain optimistic that 2016 will bring solid growth for their companies.
“Expectations are lower than in recent years but are still positive for 2016. The indication is for a stable business environment and little fear of a recession,” summarizes Steven Dutro, TCP Partner.
Many, Not Most, Still Positive About Rates
At the beginning of 2015, 79% of the participants in our survey were looking forward to rate increases over the year ahead. Turning the page into 2016, that number had dwindled to 41% – the lowest percentage we have recorded since 2009.
Despite this dampened optimism, positive expectations remain strong. Forty-one percent of those surveyed still expect their freight revenue rates to rise this year.
“In this survey, and in carrier discussions with TCP, we are seeing more variation in the opinions of individual carriers than in prior years. Any further tightening, caused by a small increase in demand or driver shortages, will have a proportionally greater upward impact on spot and contract rates,” notes Richard Mikes, TCP Partner.
Carriers Most Positive About Capacity
Perhaps most telling of industry expectations for 2016 is that a strong majority – 61% of carriers – expect to expand their fleets this year.
“Growth expectations are not quite as robust as they were in 2014 and 2015. But, this number is still relatively consistent with the expectations – and the modest growth – of the past few years.” -Steven Dutro, TCP Partner
Read the full survey results here.
Contact:
Richard Mikes
Office: (239) 395-2595
[email protected]
Steven Dutro
Office: (970) 204-1492
[email protected]
The Business Expectations Survey by TCP, now in its seventh year, has given forward-looking guidance from industry leaders through both sides of the economic cycle. Mikes and Dutro both have senior-level experience advising carriers on strategic and operational issues as well as in mergers and acquisitions in the trucking industry.
About ACT Research Co., LLC
ACT Research, a contributor to the Blue Chip Economic Indicators, has been the recognized leading publisher of commercial vehicle (CV) industry data, market analysis, and forecasting services for the North American market since 1986. Their commitment to data quality & integrity; in-depth analysis; and timeliness have made their services the industry standard.
For more information, visit www.actresearch.net.
