GE Capital: Truck Transportation Update



GE Capital said in its Winter 2015 Industry Update on Truck Transportation GDP slowed 2.6%, the ATA truck tonnage index reached an all-time high and intermodal growth exceeded 5% in Q4/14.

New construction activity, light vehicle sales and consumer retail sales will continue to be the primary drivers of freight tonnage. Demand in all of these segments should benefit from expectations of a modest acceleration in domestic GDP growth during 2015. However, given a sharp decline in crude oil prices and subsequent consequences for production, an emerging headwind could be the transport of energy.

Highlights from the report include:

  • The U.S. Commerce Department estimated that GDP growth slowed to 2.6% on an annualized basis during the 4th quarter; down sharply from the torrid 5% growth during the 3rd quarter.
  • American Trucking Associations’ (ATA) advanced seasonally adjusted For-Hire Truck Tonnage Index finished 2014 at an all-time high. Despite a very poor start, tonnage was up 3.5% for the entire year.
  • The ATA advanced seasonally adjusted For-Hire Truck Tonnage Index held steady at an all-time high in December, which was 5.2% higher than a year earlier.
  • The FTR Truck Tonnage Index for December also reached an all-time high while increasing 2.1% from November and 1.6% compared to a year earlier.

Finishing an already robust year, U.S. Class 8 net new truck orders broke out to the upside during the 4th quarter of 2014. Net orders during the 4th quarter topped 100k for only the 2nd quarter since 2006 and grew a staggering 80% compared to the same quarter a year earlier. For the entire year, 2014 Class 8 net orders increased 52% compared to 2013.

To view the full GE Capital Industry Research Update: Truck Transportation Winter 2015, click here.


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