ATA's Bob Costello (at left) and Diane SwonkLarge fleets, or those with annual revenues over $30 million, actually dropped capacity by 4.4% year-to-date compared to 2015, but small fleets added 5.5% over the same period, according to Costello. He pointed to lower used truck prices and mileages as one possible factor spurring that tractor growth among the small fleets.
“Also, truckload carriers have added trailer capacity of late, likely in advance of the approaching electronic logging device compliance deadline,” he said. “More small and medium fleets will, I believe, try to compensate for the impact of ELDs by doing more drop and hook to reduce wait times.”
The good news is that load/tractor availability is now showing signs of coming back into balance, according to Costello, who also pointed out that after almost a year of negative growth, “we’ve turned the corner on spot market rates.”
Turning to energy prices, Swonk predicted that recent oil increases into the $40 to $45 per barrel range “are moving us into a sweet spot for both consumers and producers.” Changes in oil production have brought the break even point to around $40/barrel, she said.
That should lead to a pick up in domestic oil production in mid to late 2017, according to Swonk, while consumers will continue to benefit from $40 to $50/barrel oil prices “for the next few years.”
Summing up the session on a positive note, Costello said: “We’re just seeing a little bit of evidence of [lower freight conditions] bottoming out and coming into a modest recovery.”