Today's experiences in the for-hire truckload markets indicate that there will be plenty of capacity options and better pricing starting in early 2022. The market correction that began in late Q1 2022 and lasted through last year has continued and may continue for much of 2023.
Strong Class 8 tractor manufacturing and retail sales continue to support truckload supply. Carriers are receiving much-needed new equipment that they were unable to obtain during the pandemic. This will aid in lowering the average age of tractors in fleets.
In its February forecast, ACT Research predicted that the Class 8 tractor fleet would grow by 2.6% in 2023, following a 4% increase in 2022.
A frequently asked question recently is whether the market has entered the early stages of the new cycle, known as "balance recovery." However, it may be premature to declare the oversupply phase over.
The market is undoubtedly in an oversupply phase, and some early indicators suggest that it is nearing the end of this phase:
Since October 2022, new tractor orders have been slowing, with early January figures down month over month (M/M). 1,2
There has been an increase in net revocations of trucking company operating authority. For the fourth month in a row, the net fleet size has decreased.
These early indicators do not confirm a significant market shift on their own, but they do provide some context for how the carrier community may be viewing today's truckload markets. New Class 8 orders still have a 9.5-month lead time, so carriers have a large backlog of orders that need to be produced and delivered.
As a result, keeping an eye on the order pattern for a little longer will help better inform the actual interest in continued purchases or if the slowing is influenced by the lead time to delivery, which has increased in recent months.
The data on the revocation of operating authority is a complex dance of voluntary and forced revocations, with the majority of revocation losses reactivated within a few weeks or months.
According to FTR reports, the decrease in active trucking companies may indicate some contraction. However, the Bureau of Labor Statistics reported an increase in trucking jobs in January. This could be the result of continued talent and asset migration from owner-operators to fleet employed. This migration is a shift in capacity location rather than a net loss or gain in market capacity.
Is freight volume expected to increase as a result of these supply insights?
There is a lack of agreement in the forecast for demand expansion because analysts offer a rather wide range of freight volume forecasts.
According to FTR, ACT, and Cass, freight volume forecasts for 2023 range from -4% to 1.7% across various truckload modes. Dry van volume growth is flat or even negative year on year. According to these analysts' sub-mode forecasts, refrigerated freight volumes may have the greatest opportunity. FTR forecasts a 1.7% year over year (Y/Y) increase in temperature controlled volumes.
When will the market return to a recovering supply-demand balance?
The answer will be determined by both freight creation and how the carrier community responds to an oversupplied market. Cost per mile for the truckload spot market, a leading indicator of balance recovery, is currently likely to increase in the first half of 2023.
コメント