Trucking Industry On The Road To Recovery
Most industries rely on flatbed trucking from oil and gas, aerospace, construction and manufacturing. However, according to a report made by senior research analyst Benjamin Hartford and research analyst Andrew Baird, freight demand has hit a low point in late April and early May because of the coronavirus pandemic.
ATA Chief Economist Bob Costello said that he was not overly concerned when tonnage fell in May because economic indicators like retail sales and housing rose. While tonnage went down by 10% sequentially in April, it did not fell as much as other economic indicators that month. This means that while any rebound will be more difficult, freight will continue to improve as more states lift their lockdown restrictions.
The year-over-year decline of tonnage in May was the worst since the Great Depression in 2009 but fortunately index was not falling as much during the economic downturn. While it may take the economy more than a year to recover, the trucking industry could recover its pre-Covid19 levels because it did not fell as much as other industries. The only risk that trucking faces is a resurgence that would result in states shutting down again.
It is expected that the 2019 freight levels won’t return until 2021 because of the rise in unemployment and lack of government action. Surprisingly, there was an increase in May as well as June. The reopening of the economy took longer than expected but freight demand has improved across all the US transportation modes. Spot trucking activity also improved since the Memorial Day.
Companies are upgrading their carrier’s stock because there are signs of rising imports. Container import volume went up in the Port of Los Angeles from May to June. Rising retail sales and technology investments are expected to increase freight demand. This is an indication that the trucking and freight industry will be recovering soon ahead of the economy.
Clients choose flatbed trucking for heavy loads that cannot be transported through other options. The traditional flatbed is a popular choice for construction materials and equipment, oil and gas machinery and components for manufacturing. A free quote is provided upon your request.