November Truck Tonnage Rises 3.3%
Freight Outlook Remains Weak, Officials Say
By Jonathan S. Reiskin, Associate News Editor
This story appears in the Jan. 7 print edition of Transport Topics.
November truck tonnage in-creased by 3.3% over the same month a year ago, just the third increase in the past 17 months, according to the latest survey by American Trucking Associations, whose chief economist said the gain was probably not the start of a recovery in the freight transportation industry.
“This was a nice month and much preferable to a downturn but don’t think this marks the beginning of a turn-around,” ATA Chief Economist Bob Costello said in an interview.
“The consensus forecasts for the next six months are not really robust, and this improvement from last November is based off a particularly weak comparison,” said Costello, who added that recent manufacturing news was distressing.
Moreover, William Zollars, chairman and chief executive officer of YRC Worldwide, told stock analysts Jan. 2 that the fourth-quarter shipping environment was flat.
“Volumes were significantly below last year’s, and there was also soft pricing,” Zollars said in a conference call to talk about accounting issues at his less-than-truckload carrier.
The Institute for Supply Management said Jan. 2 that its manufacturing index contracted in December to 47.7 from 50.8 in November, which Bloomberg News said was the lowest level since April 2003. When the ISM index falls below 50 points, it indicates that manufacturing is contracting.
The Commerce Department also reported Dec. 27 that orders for durable goods rose by 0.1% in November, the first gain in four months. However, when volatile orders for transportation equipment are taken out, the level of orders for durables actually declined by 0.7%.
Since July 2006, ATA’s tonnage index generally has been contracting. March and August 2007 are the only other months in that interval showing a year-over-year expansion.
“For the year through November, tonnage is down by 1.7%,” Costello said, “but it’s not falling off a cliff.”
The seasonally adjusted ATA tonnage index grew to 112 from 108.4 in November 2006. In October, it stood at 111.1 as revised, down 1.3% from 108.4 a year ago (12-3, p. 1). Beyond the year-over-year comparisons, the index has been fairly static since April, bounded by a high of 112.1 in April to a low of 110 in August.
The ATA index is based on a survey of its members that uses business activity from 2000 as a base reading of 100.
YRC’s Zollars described fourth-quarter shipping as steady but at a low level.
“It’s been pretty consistent — no better or worse than before,” he said. YRC ranks No. 4 on the Transport Topics 100 list of U.S. and Canadian for-hire carriers and is the largest LTL carrier on the list.
Among trucking-industry sectors, the tank truck and refrigerated segments are doing the best, Costello said, even showing some growth, while flatbed carriers are suffering the most because of their exposure to the battered housing industry.
On Dec. 28, the Commerce Department also said new-home sales plunged 9% to a 12-year low in November, a level lower than economists had been forecasting. In other news related to housing, Commerce said Jan. 2 that construction spending rose by 0.1% in November, but it was only a small turnaround from the 0.4% decline in October.
For the economy as a whole, the Commerce Department confirmed Dec. 20 that during the third quarter, gross domestic product expanded at an annual rate of 4.9%, and that consumer spending in November grew by 1.1%.
Separately, the Conference Board said Dec. 20 that its index of leading economic indicators declined by 0.4% in November.
This story appears in the Jan. 7 print edition of Transport Topics.
November truck tonnage in-creased by 3.3% over the same month a year ago, just the third increase in the past 17 months, according to the latest survey by American Trucking Associations, whose chief economist said the gain was probably not the start of a recovery in the freight transportation industry.
“This was a nice month and much preferable to a downturn but don’t think this marks the beginning of a turn-around,” ATA Chief Economist Bob Costello said in an interview.
“The consensus forecasts for the next six months are not really robust, and this improvement from last November is based off a particularly weak comparison,” said Costello, who added that recent manufacturing news was distressing.
Moreover, William Zollars, chairman and chief executive officer of YRC Worldwide, told stock analysts Jan. 2 that the fourth-quarter shipping environment was flat.
“Volumes were significantly below last year’s, and there was also soft pricing,” Zollars said in a conference call to talk about accounting issues at his less-than-truckload carrier.
The Institute for Supply Management said Jan. 2 that its manufacturing index contracted in December to 47.7 from 50.8 in November, which Bloomberg News said was the lowest level since April 2003. When the ISM index falls below 50 points, it indicates that manufacturing is contracting.
The Commerce Department also reported Dec. 27 that orders for durable goods rose by 0.1% in November, the first gain in four months. However, when volatile orders for transportation equipment are taken out, the level of orders for durables actually declined by 0.7%.
Since July 2006, ATA’s tonnage index generally has been contracting. March and August 2007 are the only other months in that interval showing a year-over-year expansion.
“For the year through November, tonnage is down by 1.7%,” Costello said, “but it’s not falling off a cliff.”
The seasonally adjusted ATA tonnage index grew to 112 from 108.4 in November 2006. In October, it stood at 111.1 as revised, down 1.3% from 108.4 a year ago (12-3, p. 1). Beyond the year-over-year comparisons, the index has been fairly static since April, bounded by a high of 112.1 in April to a low of 110 in August.
The ATA index is based on a survey of its members that uses business activity from 2000 as a base reading of 100.
YRC’s Zollars described fourth-quarter shipping as steady but at a low level.
“It’s been pretty consistent — no better or worse than before,” he said. YRC ranks No. 4 on the Transport Topics 100 list of U.S. and Canadian for-hire carriers and is the largest LTL carrier on the list.
Among trucking-industry sectors, the tank truck and refrigerated segments are doing the best, Costello said, even showing some growth, while flatbed carriers are suffering the most because of their exposure to the battered housing industry.
On Dec. 28, the Commerce Department also said new-home sales plunged 9% to a 12-year low in November, a level lower than economists had been forecasting. In other news related to housing, Commerce said Jan. 2 that construction spending rose by 0.1% in November, but it was only a small turnaround from the 0.4% decline in October.
For the economy as a whole, the Commerce Department confirmed Dec. 20 that during the third quarter, gross domestic product expanded at an annual rate of 4.9%, and that consumer spending in November grew by 1.1%.
Separately, the Conference Board said Dec. 20 that its index of leading economic indicators declined by 0.4% in November.
