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posted on 25 July 2019

Trucking Industry Growth Again Down In June 2019

Written by Steven Hansen

Headline data for the American Trucking Association (ATA) tonnage continues to show little year-over-year growth, and the CASS Freight Index reported the year-over-year growth rate continues in contraction.

Analyst Opinion of Truck Transport

The CASS index is inclusive of rail, truck, and air shipments. The ATA truck index is inclusive of only member movements.

I tend to put a heavier weight on the CASS index which continued in contraction year-over-year. On the other hand, the ATA index again declined and is barely in expansion.

Econintersect tries to validate truck data across data sources. It appears this month that truck employment rate of growth continues to slow. Please note using BLS employment data in real-time is risky, as their data is normally backward adjusted (sometimes significantly).


ATA Trucking

American Trucking Associations' advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index decreased 1.1% in June after falling 4% in May. In June, the index equaled 115.2 (2015=100) compared with 116.5 in May.

Said ATA Chief Economist Bob Costello:

Tonnage continues to show resilience as it posted the twenty-sixth year-over-year increase despite falling for the second straight month sequentially. The year-over-year gain was the smallest over the past two years, but the level of freight remains quite high. Tonnage is outperforming other trucking metrics as heavy freight sectors, like tank truck, are witnessing better freight levels than sectors like dry van, which has a lower average weight per load.

ATA Truck tonnage this month

z truck.png

Compared with June 2018, the SA index increased 1.5%, the smallest year-over-year gain since April 2017.

source: ATA


CASS FREIGHT INDEX REPORT

The following was reported by CASS:

  • Dropping Another -5.3% in June,
  • Negative Volume Seven Months in a Row
  • Has Economic Contraction Already Begun? Will GDP be Negative in Q2?

z truck2.png

Beyond our concern that the Cass Freight Shipments Index is negative on a YoY basis for the seventh month in a row:

  • With the -5.3% drop in June following the -6.0% drop in May, we repeat our message from last month: the shipments index has gone from "warning of a potential slowdown" to "signaling an economic contraction."
  • We acknowledge that: all of these negative percentages are against extremely tough comparisons; and the Cass Shipments Index has gone negative before without being followed by a negative GDP.
  • We acknowledge that: all of these negative percentages are against extremely tough comparisons; and the Cass Shipments Index has gone negative before without being followed by a negative GDP.

Bottom line, more and more data is indicating that this is the beginning of an economic contraction. If a contraction occurs, then the Cass Shipments Index will have been one of the first early indicators once again.

z truck1.PNG

Source: http://www.cassinfo.com/Transportation-Expense-Management/Supply-Chain-Analysis/Cass-Freight-Index.aspx



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