FTR Associates (www.ftrassociates.net) said Tuesday, Feb. 24, that its mid-month North American Commercial Truck and Trailer Outlook flash report shows a further weakening in freight and equipment demand. The full report, which will be available to subscribers in early March, will present an overview of some of the key indicators that FTR is tracking to understand when a possible economic bottom has been reached.
With economic activity on pace to worsen in the first quarter from the deep declines already registered in the fourth quarter of 2008, FTR said the industry is experiencing sharp drops in freight volume equal to the very low levels of the 1982 recession. FTR expects year-over-year tonnage freight drops to bottom at -10.3 percent in the second quarter before beginning a slow rise to a still stressful -6.6 percent in the fourth quarter.
For truckers, this promises steadily increasing pressure on rates into the summer months, FTR said; when coupled with tightened availability of credit, these freight numbers translate into very low truck production numbers. The already-low January order levels could be the highest of the year, FTR said.
“The continued economic deterioration puts us on course for a minus-10 percent freight year — the worst market in a generation,” said Eric Starks, president of Nashville, Ind.-based FTR.