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TRUCKING INDUSTRY ANALYSIS * USA - Truckers report demand declines, capacity cutbacks
Carriers, 3PLs continue to take trucking capacity out of the market
Newton,MA,USA -Purchasing, by Dave Hannon -22 April 2009: -- It’s not a big surprise, but most trucking firms that have released first-quarter earnings continue to report lower freight volumes and plunging rates as demand slumps and freight buyers continue to look to reduce costs. Freight buyers, however, may be more concerned with the carriers’ efforts to pull capacity off the roads—a strategy that may impact shippers when demand picks up... The first-quarter trend “is much weaker than the 18% decline we expected,” based upon recent data from other trucking companies, J.P. Morgan analyst Thomas Wadewitz said in a research note...(Photo from joinwaggoners: LTL truck)
* Slump Persists for Freight Haulers
New York,NY,USA -The Wall Street Journal, by ALEX ROTH -April 23, 2009: -- The first updates of the year on freight volumes at some of America's biggest trucking and rail haulers, due out Thursday, are expected to show the transportation industry remains mired in a deep slump... Shipment volumes are followed closely because a rebound in transportation usually precedes by several months a larger economic recovery. In recent days, executives at several major transportation companies said cargo levels remain depressed despite signs of life in other areas. A dour outlook by the freight haulers would signal continued economic troubles... But still, some executives in the trucking industry, which has been battered by a collapse in pricing, insist the news isn't all bad. They say volumes seem to have stabilized from the cataclysmic final months of 2008. In February, U.S. truck-tonnage volumes dropped at a 9.5% year-to-year pace, compared with a 10.8% drop in January and 12.5% decline in December. The volume drop in December represented the biggest year-to-year decline of the economic downturn... "November, December, January and February were so lousy there was only one way to go," said Stephen O'Kane, president of A. Duie Pyle, a West Chester, Pa., trucking firm...
* Truck freight still looking for bottom
Princeton,NJ,USA -Fleet Owner, by Jim Mele -Apr 22, 2009: -- While conditions will eventually turn around for the trucking industry, the growth experienced by for-hire carriers in 2005 and 2006 "may never come again," according to John White, president of U.S. Xpress Inc. Delivering an industry outlook to the 2009 ALK Technology Summit being held here, he called current economic conditions "a broad-based recession" and "the worst in the postwar era."... Freight tonnage has dropped 13.4% from its peak in 2007, "and personally I don't think we've seen the bottom yet," he said... Looking at trucking, the for-hire portion of the industry lost 79,600 jobs in 2008, and another 45,000 were axed in just the first quarter of this year, White said. After 3,000 trucking companies failed in 2008, that rate slowed to just 375 failures in the first quarter on 2009, largely due to sharply falling fuel prices, he said. "But I expect bankruptcies to pick up again now that fuel prices have stabilized," he added... One positive development driven by the economy has been a significant decrease in driver turnover. Citing numbers from a recent American Trucking Assns. study, White said the rate for large TL carriers had dropped from 130% in 2007 to 79% in 2008, while smaller fleets saw their turnover fall from 96% to 67% over the same period... "However, it won't take much of an uptick in the economy to re-ignite driver issues," he predicted. "Also the aging (of the driver population) means we'll need 50,000 new entrants just to meet existing demand levels," he said...
Labels: trucking industry analysis USA
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