A creeping, sputtering recovery
What’s up for the 2010 economy and trucking? In a nutshell, an economy slouching its way toward health and stability. Here are forecasts from three sources.
In his year-end report, Bob Costello, the economist for the American Trucking Associations, says this:
- Gross Domestic Product will have a “muted growth rate” throughout 2010, which will at least be much better than what 2009 delivered. Truck freight will mirror this.
- Flatbed freight has improved, but a predicted 17 percent drop in commercial construction during 2010 will dampen for recovery.
- Truck capacity has tightened some due to carrier failures, and because of freight and other factors, “we anticipate capacity will tighten throughout 2010.”
- Consumer spending will be soft for an indefinite period due to a weak labor market and other factors.
- Industrial output should increase 3 percent to 3.5 percent in 2010, “a stark improvement from the nearly 10 percent drop in 2009.”
- The “inventory overhang,” which prevented trucking from leading 2009’s early stages of recovery, has been largely cleared out, which bodes well for trucking.
Noel Perry, managing director and senior consultant for Nashville, Ind.-based FTR Associates, offers these forecasts:
- Trucking freight will grow 2.8 percent in 2010 and 3 percent in each of the years 2012-2014.
- Not until June 2011 will there be a healthy balance between trucking capacity and demand.
Fitch Ratings, a financial analyst firm, has these predictions:
- Overall GDP will grow of 1.8 percent in 2010.
- “Overall freight demand is not expected to return to pre-recession levels until sometime in 2011 at the earliest.”
- Trucking rates will remain depressed, especially less-than-truckload rates, due to overcapacity.