ATA reports lower truck tonnage readings but overall trends are solid

Earlier today, the American Trucking Associations (ATA) reported mixed results for truck tonnage readings in August.

The ATA’s advanced seasonally-adjusted (SA) For-Hire Truck Tonnage Index fell 1.8% from July to August, with a 112.9 reading (2015=100). This follows a 1.9% increase from June to July.

Compared to August 2017, the SA was up 4.5%, which was down from an 8.6% annual spread in July. And on a year-to-date basis through August, ATA said SA tonnage is up 7.6%, far outpacing the 3.6% annual gain for the same period a year ago.

The ATA’s not seasonally-adjusted (NSA) index, which represents the change in tonnage actually hauled by fleets before any seasonal adjustment and the metric ATA says fleets should benchmark their levels with, was 120.4 in August. This marked a 5% gain over July’s 114.6 and also topped June’s 116.1.

“Truck freight remained solid in August despite the monthly decline,” said ATA Chief Economist Bob Costello in a statement. “However, the year-over-year increase was the smallest since July 2017. The deceleration in the year-over-year increases has begun due to more difficult year-over-year comparisons. It was a year ago when freight began to surge. We should all expect smaller year-over-year gains going forward than we witnessed over the last year.”

Speaking on a recent conference call hosted by investment firm Stifel, Costello said that there are a few drivers of the current solid freight activity, including consumer spending, construction activity, manufacturing activity, and inventory levels throughout the supply chain.

“[L]ooking at the over-the-road TL and LTL markets, I like to look at factory output,” he said. “2018 is shaping up to be the highest level of production since 2007, and 2019 should be the highest on record. If we look at year-over-year growth rates, we're going to go essentially no growth in the sector from 2015 and 2016 to 2.8% growth this year and over 3% growth next year.”