ATA reports mixed trucking tonnage volumes for March

March truck tonnage volumes were mixed in March, according to data issued today by the American Trucking Associations (ATA).

The ATA’s advanced seasonally-adjusted (SA) For-Hire Truck Tonnage Index for March, at 113.2 (2015=100) was down 2.3%, following a 1.5% February decline, to 115.8, which was downwardly revised from an original reading of a 0.2% decline.

On an annual basis, March SA tonnage was up 1.6% but off compared to February’s 3.9% annual gain. For the first quarter of 2019, ATA said that SA tonnage was up 3.8% annually.

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, came in at 116.3  (2015-100) in March, topping February’s 105.5 reading by 10.3%.

“In March, and really the first quarter in total, tonnage was negatively impacted by bad winter storms throughout much of the U.S.,” said ATA Chief Economist Bob Costello in a statement. “While I expected tonnage to moderate in the first quarter, the late Easter holiday and the winter storms made it worse. It is likely that tonnage will improve in the second quarter, although year-over-year gains will be significantly below the 2018 annual increase of 6.7%.”

Looking at the state of the freight economy at the RILA Link 2019 Supply Chain Conference earlier this year, Costello said that people need to set their expectations differently for 2019 when compared to a very good 2018, in that the economy will grow, albeit at a slower rate.

That was made clear in GDP estimates Costello provided, with 2019 GDP pegged to hit 2.4%, 1.6%, 2.5%, and 2.1%, respectively for the first, second, third, and fourth quarters.

While these may numbers may look somewhat dim when placed against what can be viewed as a robust 2018, Costello made it clear that key economic fundamentals remain firmly intact.

These fundamentals include things like still strong consumer activity, as well as a solid job market.

Addressing the latter, he said that there are currently more job openings than there are unemployed people, which “does not usually happen.” What’s more, he raised the question of what happens when full employment is reached, as it relates to wages. And the short answer was that wages go up, which obviously continues to support economic growth and freight activity.

“Last year, we were at the height of the cycle with wage growth of 3% and consumers continuing to spend on goods…it will likely slow down a bit but the fundamentals remain good,” he said.

On the other end, though, are housing starts, which Costello labeled a disappointment, even though there 2018 represented the best year for housing starts since 2007, with recent months showing a flatness in the market. How so?

Well, the December 2016 new housing starts numbers, he said, were the weakest going back to September 2016.

Costello attributed the recent slump to a combination of some supply issues, coupled with mortgage rates rising. Housing issues, at the moment, aside, Costello said factory output remains strong, up 2% in 2018, with a bullish future outlook.

“This all leads to a growing economy and a growing trucking sector, too, but not quite as strong as 2018,” explained Costello.