An economy still deep in the doldrums and the accompanying depressed job market are driving down the near-term expectations of motor carrier executives recently surveyed.
According to Transport Capital Partners (TCP), its 3Q 2011 Business Expectations Survey found that only 45% of the carrier executives surveyed expect volume increases in the next 12 months, compared with 80% in the survey done in May.
“The weak-to-flat economy and general malaise shown in jobs outlook has truckers joining other businesses in a lack of confidence in the recovery,” said Richard Mikes, TCP partner and survey founder. He added that a similar percentage (48%) of the carriers shifted to a “remain the same” outlook this quarter.
“TCP expects the next year to be heavily influenced by macro events in this tenuous environment,” pointed out Lana Batts, TCP partner. She noted that in contrast to last quarter, smaller carriers (under $25 million in revenue) are more optimistic, with 54% expecting business volume increases compared to 38% of the larger carriers.
Furthermore, expectations for rate increases showed a decline for the first time in a year with 61% of the carriers expecting increases, and a third of the carriers expecting rates to remain the same. According to TCP, “truckers are becoming more cautious and this attitude may be reflected in future truck orders.”
Batts also said that “increased government regulation has been felt by the industry and it is apparent that uncertainty is taking its toll on truckers.” Additionally, Mikes pointed out “recent downward trends in consumer confidence, uneven freight demand reports, and spot market volatility are all signs of an economy whose direction is uncertain in carriers’ minds.”
The partners noted that TCP couples these survey results with conversations they hold daily with carriers and others in the industry to “present an insightful dialogue on key issues.”For more details from TCP and to view survey graphs, click here.