No bottom seen for national trucking industry recession

Fort SmithNews on the Wire

by The City Wire staff ([email protected]) April 27, 2009 5:07 pm 65 views 

The March truck tonnage index suggests the terrible freight recession for the trucking industry has not yet hit bottom.

The American Trucking Associations’ advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index fell 4.5% in March, marking the first month-to-month decrease of 2009.  The gains during January and February, which totaled 4.5%, were erased with March’s drop. In March, the tonnage index equaled just 101.4 (2000 = 100), which is its lowest level since March 2002.
 
“Compared with March 2008, tonnage contracted 12.2 percent, which was the second-worst year-over-year decrease of the current cycle. In December 2008, the largest year-over-year contraction, tonnage dropped 12.5 percent from a year earlier,” according to the ATA statement.

“Many fleets were telling us during March that freight was getting a little better. The problem is that freight should be significantly better in March, which is why the seasonally adjusted index fell,” ATA Chief Economist Bob Costello noted in the statement. “While the industry is desperate for some positive news, it is unfortunate that March’s data suggests the industry has not hit bottom just yet.”   

The two national trucking companies based in the area have not escaped the impact of the national freight recession.

Fort Smith-based Arkansas Best Corp.’s posted a first-quarter net income loss of $18.2 million. Total revenue for the quarter was $339.7 million, down 24% from the 2008 quarter, according to the April 22 earnings report by the company.

Van Buren-based USA Truck announced April 16 a first-quarter net income loss of $1.88 million resulting from “severe contraction” in freight demand. Total revenue in the first quarter was $93.49 million, down 26.5% from the $127.23 million in the same period of 2008.
 
Trucking, according to ATA, serves as a barometer of the U.S. economy, representing nearly 69% of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods. Trucks hauled 10.2 billion tons of freight in 2008.