ACT Research
Act For Hire Freight Rates

ACT: Trucking strengthens in September

Oct. 28, 2021
Latest For-Hire Trucking Index shows increase in volumes, pricing, and capacity entering peak holiday shipping season

The latest release of ACT’s For-Hire Trucking Index, with September data, showed an increase in volumes, pricing, and capacity, with a lower but still-strong supply-demand balance.

The ACT For-Hire Trucking Index is a monthly survey of for-hire trucking service providers. ACT Research converts responses into diffusion indexes, where the neutral or flat activity level is 50.

“Although it increased in September, the Volume Index is still considerably below the 65.5 average of the past 12 months, due in large part to supply bottlenecks,” said Tim Denoyer, vice president and senior analyst at ACT. “In particular, chip and part shortages are hindering vehicle production, though peak holiday shipping is continuing to provide demand support.

“Trucking markets remain very tight, with the newly proposed vaccine mandate likely disrupting the recovery in driver hiring in the near-term and new equipment production still challenged, so the recipe is still right for record rate increases. However, the driver response to higher pay rates is ongoing, and we ultimately expect little impact of employer vaccine mandates in trucking, where about 80% of capacity is in fleets under 100 employees. Equipment supply-chain constraints also continue to limit capacity growth, and hiring and retention of new drivers will be key to the rate trajectory.”

Regarding the supply-demand balance, Denoyer noted, “While down from this year’s peak of 69.2 in April, the current reading still reflects a tight supply-demand environment. Class 8 retail sales are constrained by tight inventories and unmet production demand due to parts shortages, slowing the recovery in equipment capacity.

“With some structural driver issues likely to outlast the pandemic and a generally positive freight outlook, we do not expect the market to loosen quickly.”