Barrington Freight Blog: US truck tonnage fell in May
The American Trucking Association s advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index decreased 0.7% in May after falling 1.1% in April.
The latest drop lowered the SA index to 117.8 (2000=100), down from April s level of 118.7.
Compared with May 2011, the SA index was 4.1% higher, the largest year-over-year increase since February 2012. Year-to-date, compared with the same period last year, tonnage was up 3.8%.
The not seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment, equaled 124.5 in May, which was 6.5% above the previous month.
“Two straight months of contractions is disappointing,” ATA Chief Economist Bob Costello said.
“The drops in tonnage are reflective of the broader economy, which has slowed.
“The good news is that the decrease in fuel prices will help support retail sales going forward, which is a big part of truck tonnage,” he said.
As a negative, Costello said he s concerned about businesses sitting on cash instead of hiring more workers or spending it on capital, both of which would give the economy and tonnage a shot in the arm, as they are worried about Europe and the so-called U.S. fiscal cliff at the end of the year.
He also reiterated last month s comment: Annualised tonnage growth should be in the 3% to 3.9% range this year.
Each month, the ATA asks its membership the amount of tonnage each carrier hauled, including all types of freight. The indexes are calculated based on those responses. The sample includes an array of trucking companies, ranging from small fleets to multi-billion dollar carriers.
When a company in the sample fails, we include its final month of operation and zero it out for the following month, with the assumption that the remaining carriers pick up that freight. As a result, it is close to a net wash and does not end up in a false increase.
Nevertheless, some carriers are picking up freight from failures and it may have boosted the index. Due to our correction mentioned above however, it should be limited.
Trucking serves as a barometer of the U.S. economy, representing 67.2% of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods. Trucks hauled nine billion tons of freight in 2010. Motor carriers collected $563.4 billion, or 81.2% of total revenue earned by all transport modes.
ATA calculates the tonnage index based on surveys from its membership and has been doing so since the 1970s. This is a preliminary figure and subject to change in the final report issued around the 10th day of the month. The report includes month-to-month and year-over-year results, relevant economic comparisons, and key financial indicators.
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