A further weakening in freight and equipment demand is indicated by a mid-February report from FTR Associates, Nashville TN.
The American Commercial Truck and Trailer Outlook released February 23 by FTR noted that with economic activity on pace to worsen in the first quarter of 2009 from the deep declines already registered in the fourth quarter of 2008, the industry is experiencing sharp drops in freight volume equal to the very low levels of the 1982 recession.
FTR expects year-over-year tonnage freight drops to bottom at a minus-10.3% in the the second quarter of 2009 before beginning a slow rise to a still stressful minus-6.6% in the fourth quarter of 2009.
For truckers this promises steadily increasing pressure on rates into the summer months. When coupled with tightened availability of credit these freight numbers translate into very low truck production numbers, FTR said.
The already low January order levels could be the highest of the year. Eric Starks, president of FTR pointed out how negative things look: "The continued economic deterioration puts us on course for a minus-10% freight year. The worst market in a generation."
The full FTR report will be available to subscribers in early March and will present an overview of some of the key indicators that FTR is tracking to understand when a possible economic bottom has been reached, according to FTR information.