Subscribe to our free, weekly email newsletter!


2010 Mid-year rate outlook: Paying a Premium

While the extent of the recovery remains uncertain, shippers will continue to be hit with rate increases across all modes.
image
By John Paul Quinn, Contributing Editor
July 15, 2010

In the earlier stages of the downward economic trend of the past two years, analysts were initially reluctant to use the dreaded “R-word.” But now it seems as if they’re equally wary about using another “R-word,” but this time it’s “recovery.”

“We seem to be enjoying a burst of growth, but the fundamentals aren’t there,” says David Jacoby, president of supply chain consulting firm Boston Strategies International.

“The job growth is largely in temp work and there has even been a slowing of this as we approached the middle of the year.”

Jacoby adds that corporate investment is also lagging as companies are conservatively hedging their bets since many don’t see this as a sustainable growth situation—at least not yet. “This is not necessarily a dangerous scenario, but it’s a disappointing one,” he says.

Forecasts of GDP growth are hesitant and cautionary as well, according to Paul Bingham, managing director of trade and transportation at IHS Global Insight.

According to Bingham, real growth is forecast to be up 3.4 percent this year in contrast to the negative 2.4 percent of 2009, but the pace is expected to slow back to 2.8 percent in 2011.

About the Author

John Paul Quinn
Contributing Editor

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Jacksonville, Fla.-based Florida East Coast Railway (FECR), a 351-mile freight rail system on the state’s east coast, recently made two separate announcements. One had to do with an expansion of intermodal services between Charlotte, N.C. and various locations in South Florida and another was related to the company boosting its intermodal capacity through the addition of new equipment.

The International Air Transport Association (IATA) announced August 2014 data for global air freight markets showing continued “robust”growth in air cargo volumes.

Even though some of its key metrics dropped sequentially from August to September, the outlook for manufacturing over all remains strong, according to the most recent edition of the Manufacturing Report on Business issued today by the Institute for Supply Management (ISM).

Company officials said that these planned changes, which will take effect on January 4, 2015, will provide for increases in current pay rates and reduce the time it takes for its nearly 15,000 drivers to reach top pay scale.

While the economy has seen more than its fair share of ups and downs in recent years, 2014 is different in that it could be the best year from an economic output perspective in the last several years. That outlook was offered up by Rosalyn Wilson, senior business analyst at Parsons, and author of the Council of Supply Chain Management Professionals (CSCMP) Annual State of Logistics Report at last week’s CSCMP Annual Conference in San Antonio.

Article Topics

· All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA