FTR’s Trucking Conditions Index for July declined to 12.4 – an historically strong reading – after the two most favorable months for carriers ever in May and June. Less upward pressure on freight rates was the main factor in a modest deceleration in market conditions. Partial offsets were tighter capacity and lower financing costs.

Avery Vise, FTR’s vice president of trucking, commented, “While we still see truck freight market conditions as favorable for carriers during the two-year forecast horizon, the period of extraordinary improvement might be over. The biggest wild cards remain whether pressure on foreign truck drivers and other enforcement efforts keep capacity growth in check and whether the buildout of data centers continues at its current pace into next year or beyond. If either of those situations prove to be the case – and certainly if both do – trucking conditions could remain robust.

“Diesel prices are another concern, of course, although for much of the market they are mostly a pass-along cost. However, if spot rates were to soften while diesel prices are at a near-record level, trucking companies might find themselves with an ample supply of drivers who previously worked for failed small carriers. The result could be akin to the sharp increase in truckload employment in 2022 following Russia’s invasion of Ukraine.”

Details of the July TCI are found in the September issue FTR’s Trucking Update, published August 28. The September issue commentary includes highlights of an upcoming revision to transportation employment estimates. The Trucking Update includes data and analysis on load volumes, the capacity environment, rates, and the economy.

The TCI tracks the changes representing five major conditions in the U.S. truck market. These conditions are: freight volumes, freight rates, fleet capacity, fuel prices, and financing costs. The individual metrics are combined into a single index indicating the industry’s overall health. A positive score represents good, optimistic conditions. Conversely, a negative score represents bad, pessimistic conditions. Readings near zero are consistent with a neutral operating environment, and double-digit readings in either direction suggest significant operating changes are likely.