Look for Tepid but Steady Growth in Trucking Sectors in 2015
Increase In Trucking For 2015
Any increase in business is good news in the trucking industry. Also, if the trends are correct, the industry will have a slow, gradual increase in business throughout the year, which is excellent news for freight shippers, carriers and brokers.
An article published on fleetowner.com tells about the growth in all transportation modes - trucking, railways and airlines. The growth is expected to moderately accelerate continually throughout 2015. In trucking, specifically, David Ross, a managing director with Stifel Nicolaus & Co., a Wall Street investment firm, thinks that as truck-borne freight volumes increase, rates should increase as well.
Mr. Ross predicts that contract TL (Full Truck Load) rates will increase 3% - 5%, while dedicated TL rates will raise 2% - 4%. He predicts LTL (Partial Truck Loads) rates will raise 3% - 4% this year. The factors that may determine whether the TL/LTL are higher or lower can be industry capacity, freight growth, and carrier capacity and pricing discipline. Also, Ross adds, the landscape of the freight industry is bound to be capacity - constrained over the next few years due to rising volumes and flat capacity levels, taking into account driver shortage issues and added government regulations.
The fact that the US manufacturing sector is expected to stay strong, thereby creating more freight for motor carriers to haul is one reason experts are confident in the prediction of increasing rates. Another reason is optimism among US industrial manufacturers in regards to the direction of the domestic economy as it continues to rise.
This, despite concerns with the impact of the strengthening dollar, plans to expand abroad softening, and reduced expectations regarding the level of sales contributions from international operation. (These are according to a survey done by Pricewaterhouse Cooper.)
What does this mean for you, as a shipper or broker? It could be more business, or that you can charge higher rates. Time will tell. For more trucking news and information, please visit our website.
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