The latest release of ACT Research’s For-Hire Trucking Index indicated the supply and demand balance decreased in August, as freight volumes and capacity declined.
The volume index declined 6.0 points month over month, falling to 46.3 (seasonally adjusted) in August, from 52.3 in July, as the pull-forward ahead of August tariff deadlines ended. After considerable volume pull-forwards since late last year, the volume outlook is challenged, though the Supreme Court’s November decision regarding IEEPA tariffs may provide some relief.
“Consumer spending trends remain strong, but consumers have so far been insulated from price increases, as most tariff costs have yet to be passed on,” Carter Vieth, research analyst at ACT Research, said. “Real income growth has slowed and could decline as inflation picks up. The freight downturn, now in its fourth year, is unlikely to pick up while the trade war worsens. However, the private fleet expansion that we see as a key reason behind the long downturn is starting to reverse.”
The capacity index decreased 0.6 points month over month, to 45.4 in August from 46.0 in July.
“Publicly traded TL carriers’ profit margins remain near the lowest levels since 2010. Tariffs have added cost and uncertainty, spurring demand for pre-tariff tractors in Q2, further delaying a for-hire recovery,” Vieth said. “Renewing bonus depreciation may help at the margin, but not with margins where they are, and major ongoing uncertainty about tariffs and emissions regulations seem to outweigh incentives to invest.”
