Subscribe to our free, weekly email newsletter!


Ceridian-UCLA Pulse of Commerce Index is down in January for first time in four months

By Jeff Berman, Group News Editor
February 14, 2012

January marked the end of a three-month growth streak for the Ceridian-UCLA Pulse of Commerce Index (PCI).

The PCI, according to Ceridian and UCLA, is based on an analysis of real-time diesel fuel consumption data from over-the-road trucking and is tracked by Ceridian, a provider of electronic and stored value card payment services. The PCI data is accumulated by analyzing Ceridian’s electronic card payment data that captures the location and volume of diesel fuel being purchased by trucking companies. It is based on real-time diesel fuel purchases using a Ceridian card by over the road truckers at more than 7,000 locations across the United States.

January’s PCI dipped 1.7 percent after a 0.4 percent December gain and increases of 0.1 percent and 1.1 percent in November and October, respectively. With this decline, the PCI has seen growth in five of the last 11 months.

On an annual basis, the PCI is down 2.2 percent compared to January 2011, which equates to “essentially no growth” since the summer of 2010, a year-and-a-half span. The report’s authors noted that while the PCI appears to have stalled out when compared to other economic metrics showing growth such as industrial production and real retail sales, its annual changes, however, make it look more accurate.

As an example, the report cited how the three-month moving average, which peaked at 8 percent in July 2010 has dropped to close to zero percent in January. The report noted how the July 2010 peak and deterioration throughout 2011 correctly anticipated the same movement of Industrial Production, Total Business Real Inventories, and Real Retail Sales, with the PCI weakness suggesting further weakness for these indicators or a big gain in trucking activity in February, March, and April.

“Going back a few months, there has been this divergence between several [economic] indexes,” said Ed Leamer, chief PCI economist and director of the UCLA Anderson Forecast. “Industrial production, retail sales are showing improvements and the labor market is healing substantially, which is making most people optimistic about 2012 compared to 2011.”

But when looking at trucking, Leamer said it could still be too early to tell if 2012 will be an improvement, as it was initially thought that the divergence would be resolved by weaker industrial production or retail sales or by strengthening in trucking.

What’s more, he said there was an expected improvement in trucking heading into December, which did not occur, and in January trucking activity on a seasonally-adjusted basis was also down.  And today’s relatively weak retail sales also tend to support the January PCI output, he said.

“It seemed like there was a puzzle that needed to be resolved in terms of why is it that so many measures optimistic and improving substantially, whereas trucking is not, and it occurred to me that there is a variety of reasons as to why we could have a misreading on trucking,” he said.

Among the potential reasons was a shift from trucking to rail and intermodal transportation, and another was fuel efficiency, as there is a higher emphasis on fuel efficiency—with rising prices truly back—than there was before.

Another possibility was that there fewer trucking customers using Ceridian’s electronic card payment data.

“Modal shifts and fuel efficiency are doubtlessly important forces, but they are going to be more evident in longer-term annual comparisons more than month-to-month,” explained Leamer. “We are left with the possibility that a very warm January may have allowed more fuel efficient activity to occur. The divergence of trucking and these other economic measures cannot continue indefinitely so it has to be resolved either with improved trucking activity in February, March, and April, or the U.S. economy is going to be much slower than most people think.”

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


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

Second quarter revenue for transportation and logistics titan UPS headed up 5.6 percent annually at $14.3 billion, while operating profit sank 57.1 percent to $747 million. Quarterly net income fell 57.6 percent to $454 million.

Panjiva, an online search engine with detailed information on global suppliers and manufacturers, recently said it is opening up the “vault,” so to speak. The vault in this case is making its copious amount of trade data accessible through an Application Programming Interface (API), which enables customers to extract Panjiva’s trade data into their own database.

Freight transportation and logistics services provider Averitt Express recently announced it has rolled out improved transit times for less-than-truckload (LTL) service from the Midwest to Toronto and other cities.

Data issued by the National Retail Federation lowered its 2014 retail sales forecast, due to a slow first six months of the year (and largely negatively influenced by the terrible winter weather), but noted that retail sales are expected to be strong over the next five months to finish the year.

Anne Ferro, a ferocious advocate for greater truck safety and a constant thorn to truck drivers and some unsafe trucking fleets, says she is leaving as administrator of the Federal Motor Carrier Safety Administration. No successor has been immediately named.

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