Key to freight demand in '09 were the traditional drivers, the most intuitive being the housing industry and the movement of building materials, merchandise traffic destined for retailers, and consumer spending.

2009 saw year-over-year housing starts drop by 12.4%, yet November monthly activity rose over October by a robust 9%. Further, housing permits issued for new construction were up 6% over 2008.

Import container volumes act as a rough yardstick for gauging consumer demand: think Wal-Mart, Target and Sears. As of September 2009, container import traffic USA-wide was off by 17% from 2008. Retail inventory buildup worries? Not anytime soon judging by those numbers.

Offering hope for 2010, consumer spending improved in November 2009 with a .7 percent increase over previous months. Further, personal income rose by .2 percent. Also adding to evidence of an improving economy, November retail sales were up 1.9% over last November.

Will the Economy be the story of 2010? Nobody knows. The many failed predictions on this recession, leaves even the most optimistic among us cynical. Why add yet another US economic forecast? After all, the economy is beyond our control. What we can do, however, is manage our 2010 costs. It's here in the cost outlook that I offer the cynics among you one more forecast.

Consider the industry's major cost components: driver wages and benefits, fuel prices, new trucks, repair parts, loan rates and insurance costs. Using publicly available information, here is what to expect in 2010:

1. Driver Wages (including benefits) are currently $21.41 an hour (65% salary and 35% benefits); this should remain flat through 2010.
2. Diesel Fuel Prices, per the Dept. of Energy, are forecasted to go up by 20% in 2010 from DOE's 2009 number of $2.46 per gallon to $2.96 per gallon. So budget for this increase, and enjoy any savings later, if prices fall.
3. New Heavy Trucks (33,000 lbs and above) Prices are up 4% over last year using the Dept. of Labor, Bureau of Labor Statistics historic averages.
4. Interest Rates for business loans are expected to remain untouched per the Federal Reserve's December 16th announcement citing tight credit and the job losses.
5. Now for a little good news; Repair Parts for your fleet will not cost anymore than they did in 2009.
6. Insurance Premiums are also good news, with the insurance industry seeing a 3-year negative premium growth, it's a declining market for the first time since 1930-1933! So, now may be the time to negotiate.

About the writer: as this is my first post for BTTV, you may be wondering who I am to be writing about cost forecasts for the trucking industry. My background includes a stint at the ATA, working on Trucking finance, tax and insurance matters. Before that, I worked on transport matters for another industry and earlier on, worked for several shippers. That is, I touched cardboard, a lot. I welcome your feedback, input, thoughts, etc., so please feel free to email me at dhersheydc99@hotmail.com.