It’s been a brutally difficult year in the trucking industry. There’s no question about it. And all truckers have felt the pain of it. In fact, truckers like Lexington, Kentucky located owner-operator Chad Boblett have described the past year as “a bloodbath.” However, an upswing may be on the way for the trucking industry.
According to available statistics, around 2,500 truck drivers, were laid off by trucking companies who’ve declared bankruptcy in 2019. In fact, big time carriers like J.B. Hunt, Knight-Swift, and Schneider have all significantly reduced their annual projections. Even worse, the rate average among industry behemoths sunk to recession-equivalent lows in July. This data comes courtesy of a recent Morgan Stanley survey.
Positive Signs Emerging
But it’s not all gloom and doom. There are some positive signs emerging. Some of these signals of an upswing are so strong that trucking leaders are predicting a bounce back effect later in the year.
The Chainalytics-Cowen Freight Indices indicates that the freight rates have experienced an uptick for three straight weeks. Though they remain low in the spot and contract market went put up against last years’ figures. Another positive sign is that volume expansion has risen ever since July 31st. Furthermore, ACT Research pointed out that there was a surprising in July. This shipping data group referred to it as an “anomalous spike.”
Tim Denoyer, ACT Research vice president said in a recent release, “Volumes showed signs of life in July for the first time this year, for at least some of our friends in the industry.”
Another promising sign of the year end outlook is that robust earnings this past week from Target and Walmart hint that a modest outlook for retail may be incorrect. Bottom line, if consumers are starting to make more purchases then trucks will be shipping more cargo in their trailers.
Though the year in trucking has been wildly up and down, the July bounce after a grim May and June is truly promising. Tonnage really grew in July.
So, what do you all think, is trucking going to end the year on an upswing?