Big Truck TV
Key equipment rates and overall negative economic reports coupled with a further decline in MDI are just some of the business news that we are reporting on in this edition of the Industry Economic Update. We will also be looking at the drop in the Purchasing Managers Index & the recent gains in construction. We also feature highlights from an interview we had with Tim Burke – President of Sammons Trucking to discuss the market dynamics impacting equipment rates.
With the Market Demand Index dropping 18%, how is this going to impact the outlook for trucking?
Market Demand Index is still sitting well above seven which is a good thing for trucking, however in recent weeks have seen a steady decline in the MDI. It has taken a significant slide of 18%, which leaves it sitting at 14.09, we need to keep a close eye on this as there could be a downward trend developing here which does not bode well for the industry. While a number of economic statistics are not quite alluding to a recession, the economy is growing at a below trend place.
Irrespective of the drop in fuel prices, equipment rates are on the rise, what is contributing to this increase?
Over the last four months we’ve seen this disparity between fuel and equipment rates so it is clearly evident that other factors are driving equipment rates up. Some of the major issues pushing the rates up are strict regulations and the limited driver pool, which is creating a capacity issue nationwide.
What can we attribute to the dramatic drop in load availability?
Load availability has taken a significant decline of nearly 35% over the last month since June 11th. The recent holiday has some impact but not dramatic. Other factors contributing to this decline is attributed to June’s PMI, indicating a decreasing demand for trucking.
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