ACT Research For-Hire Trucking Index Highlights Driver Shortage in July
AUG 27, 2020 - 6:36 am
The latest release of ACT’s For-Hire Trucking Index, with July data, showed an across-the-board downtick in the diffusion indexes after a record surge in June, although most measures remained well above the 50 neutral mark. July’s Volume Index fell six points to 64.3 (SA), while pricing and productivity were at 60.3 and 61.5, respectively. Capacity and driver availability were the two indexes in contraction territory, at 48.1 and 39.3, respectively, highlighting that driver capacity is tighter than equipment capacity.
“The sharp drop in driver availability as freight volumes are recovering explains the need for higher rates that we’re seeing in the spot market.” Tim Denoyer, ACT Research’s vice president and senior analyst, said, “Consistent with industry estimates that CDL issuance this year is tracking about 40% below normal levels, the Driver Index has tightened sharply. We see this as the primary capacity constraint presently, as equipment remains available at this point.
“Even before Hurricane Laura, which is adding further stress to the trucking markets, this driver shortage has significantly tightened the market balance.”
The ACT For-Hire Trucking Index is a monthly survey of for-hire trucking service providers. ACT Research converts responses into diffusion indexes, where the neutral or flat activity level is 50.
The ACT Freight Forecast provides forecasts for the direction of truck volumes and contract rates quarterly through 2020 with three years of annual forecasts for the truckload, less-than-truckload and intermodal segments of the transportation industry. For the truckload spot market, the report provides forecasts for the next 12 months. In 2019, the average accuracy of the report’s truckload spot rate forecasts was 98%. The ACT Research Freight Forecast uses equipment capacity modeling and the firm’s economics expertise to provide unprecedented visibility for the future of freight rates, helping businesses in transportation and logistics management plan for the future with confidence.
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