Tonnage index drops in August

user-gravatar Headshot

North Texas Tollway Authority voted to increase toll rates effective Sept. 29 and to begin converting its toll roads, including the Dallas North Tollway and the President George Bush Turnpike, to all-electronic collection next year.

New York State Thruway Authority is considering increasing tolls and reducing
E-ZPass discounts to offset slower-than-expected traffic growth, the Associated Press reported Sept. 25. Most commercial and passenger drivers could see toll increases of less than 5 percent phased in over several years, AP said. Tolls on the New York City-to-Buffalo highway rose substantially in 2005 for the first time in 17 years.

National Motor Freight Traffic Association ( released ClassIT 2.0, the latest version of the online National Motor Freight Classification, a pricing tool that evaluates and classifies all the commodities shipped and handled by motor freight carriers moving in interstate, intrastate and foreign commerce.

IdleAire Technologies Corp., which offers truck-stop electrification and other cab comfort and entertainment services, filed for an initial public offering with the Securities and Exchange Commission Sept. 18. The Knoxville, Tenn.-based company did not disclose the estimated number or price range of the shares to be offered, but indicated the offering price could total up to $100 million.

The American Trucking Associations’ advanced seasonally adjusted For-Hire Truck Tonnage Index decreased 0.8 percent in August, after increasing 0.3 percent in July. The not-seasonally adjusted index jumped 8.2 percent from July to 120.1.

On a seasonally adjusted basis, the tonnage index fell to 110.0 in August. Despite August’s sequential decrease, tonnage was up 0.9 percent from a year earlier, marking the first year-over-year increase since March of this year. Year-to-date, the tonnage index was 2.2 percent lower than during the same period in 2006.

ATA Chief Economist Bob Costello said the August tonnage reading points to continued softness in the trucking industry, specifically as it relates to the weight of goods shipped, and to the slow start of the 2007 fall freight season. Costello noted that the positive gain in the year-over-year reading has more to do with sluggishness in August 2006 rather than strength this August.

“August 2006 marked the beginning of the current slowdown for our industry,” Costello said. “The slight year-over-year gain this August is primarily due to easier comparisons and is not indicative of a turnaround for the economy and trucking.”

Truck freight is expected to be lackluster during the 2007 fall freight season, which traditionally starts in mid- to late August and peaks in October. “Economic growth just isn’t strong enough to significantly boost truck tonnage anytime soon,” Costello said. “We recently reduced our economic forecasts and don’t believe tonnage will consistently grow at its historical average over the last 10 years of 2.5 percent until the second half of 2008.”

ATA calculates the tonnage index based on surveys from its membership and has been doing so since the 1970s. The baseline year for the index is 2000.

Fed sees softening in transport demand
The Federal Reserve Board reported that demand for transportation services was softening, but some regions reported no change. The board commented on trucking and transportation in its Beige Book, a report it produces eight times a year on the nation’s 12 regions. It summarizes business actions based on comments received in August from contacts outside the Federal Reserve.

Overall economic activity has continued to expand, with moderate activity reported in St. Louis and Kansas City. Cleveland, Chicago and Minneapolis said their economies were expanding at a modest rate. Boston and Atlanta reported mixed activity, while New York reported continued expansion. The Philadelphia, Richmond, Dallas and San Francisco economies continued to grow but at a slower pace.

Atlanta and Dallas said they had less transportation activity, while Cleveland and Chicago reported no change. Dallas rail, small parcel and intermodal companies reported decreases in cargo volume in the past month. In Chicago, grain storage construction increased, but not enough to ease concerns about storage problems at harvest.

In St. Louis, transportation equipment companies plan to expand. In Boston, sales of transportation equipment other than automobiles grew at a robust pace. In Philadelphia, companies producing lumber, building materials and transportation equipment reported decreases.
– Jill Dunn

CARB to offer $1 billion in upgrade incentives
The California Air Resources Board plans to use $1 billion in bond financing to offer incentives, through local agencies, to owners of equipment used in freight
movement to upgrade to cleaner technologies.

The program would target freight moving in four major transportation corridors: Los Angeles port to the Inland Empire; State Route 99 in the Central Valley; the San Francisco Bay Area; and the San Diego border region.

CARB’s initiative, which is currently in the conceptual phase, would be available to all modes – trucks, trains, ships and harbor craft. The agency is conducting public meetings in early October, and it plans to adopt guidelines in December to identify the criteria, procedures and specific requirements to be followed by local agencies and equipment owners to receive bond funding. Staff then will solicit applications from local agencies, and the board will select projects for the initial $250 million by June 2008.

The program would be funded through bonds approved by California voters last November. Proposition 1B authorized nearly $20 billion in bonds, including investments in highway improvements, congestion relief, expanded public transit, safer rail crossings and improved anti-terrorism security at shipping ports.

For more information on CARB’s proposal, visit