Tracking the Trucking Tracking the Trucking Industry… Industry… 2004 and Beyond 2004 and Beyond Presented by Dan Murray American Transportation Research Institute
Dec 29, 2015
Tracking the Trucking Tracking the Trucking Industry…Industry…
2004 and Beyond2004 and Beyond
Presented by
Dan MurrayAmerican Transportation Research Institute
Source: Institute for Supply ManagementSource: Institute for Supply Management
0
10
20
30
40
50
60
70
2000 2001 2002 2003 2004
Manufacturing ProductionPurchasing Managers Index
False StartFalse Start
Growth ThresholdGrowth Threshold
December’s reading was the highest level in 20 years.
Sources: Department of Labor & ATASources: Department of Labor & ATA
405060708090
100110120130140150160
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1993
1995
1997
1999
2001
2003
Manufacturing ProductivityManufacturing Productivity(1992=100)(1992=100)
The surge in productivity has been good for businesses and consumers, but a mixed bag for manufacturing workers:
Incomes
Employment Trend line
1970s 2.7%1980s 2.6%1990s 3.2%2000s 4.1%
Source: Department of CommerceSource: Department of Commerce
-2%
0%
2%
4%
6%
8%
10%
12%20
00
2001
2002
2003
2004
Retail SalesRetail SalesYear-Over-Year GrowthYear-Over-Year Growth
Consumer spending is more than 2/3 of the economy!
Sales excluding Autos
Total Sales
Source: The Conference BoardSource: The Conference Board
50
75
100
125
150
2000 2001 2002 2003 2004
Consumer ConfidenceConsumer ConfidenceThe problem with consumer confidence is that it can be impacted by more than just economic events.
September 11th
Corp. Scandals
Iraq War
Iraq War
Source: American Trucking AssociationsSource: American Trucking Associations
128
132
136
140
144
148
152
15619
99
2000
2001
2002
2003
ATA’s Monthly Truck Tonnage Index 1993=1001993=100
Source: American Trucking AssociationsSource: American Trucking Associations
55
75
95
115
135
155
175Ja
n-85
Jan-
86
Jan-
87
Jan-
88
Jan-
89
Jan-
90
Jan-
91
Jan-
92
Jan-
93
Jan-
94
Jan-
95
Jan-
96
Jan-
97
Jan-
98
Jan-
99
Jan-
00
Jan-
01
Jan-
02
Jan-
03
Trucking’s Progress Since 1985
6% Average Annual Growth Rate6% Average Annual Growth Rate
ATA’s Monthly Truck Tonnage IndexATA’s Monthly Truck Tonnage Index(1993 = 100)(1993 = 100)
Source: ATA’s Source: ATA’s Trucking Activity ReportTrucking Activity Report
75
100
125
150
175
200
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Truckload Loads(1993=100)
Small CarriersSmall Carriers(Less than $30 Million(Less than $30 Millionin annual revenues)in annual revenues)
Large CarriersLarge Carriers(More than $30 Million(More than $30 Millionin annual revenues)in annual revenues)
Source: ATA’s Source: ATA’s Trucking Activity ReportTrucking Activity Report
100
125
150
175
200
225
1996 1997 1998 1999 2000 2001 2002 2003Short-haul (Less than 500 miles)Medium-haul (500 to 1,000 miles)Long-haul (Greater than 1,000 miles)
Truckload Loads(1996=100; average length of haul basis)
Source: ATA’s Source: ATA’s Trucking Activity ReportTrucking Activity Report
75
100
125
150
175
200
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
LTL Volumes(1993=100)
Small CarriersSmall Carriers(Less than $300 Million(Less than $300 Millionin annual revenues)in annual revenues)
Large CarriersLarge Carriers(More than $300 Million(More than $300 Millionin annual revenues)in annual revenues)Strike
Recession hitLTL freight
hard
Sources: A.G. Edwards & ATASources: A.G. Edwards & ATA
250
450
650
850
1,050
1,250
Q1
90
Q1
91
Q1
92
Q1
93
Q1
94
Q1
95
Q1
96
Q1
97
Q1
98
Q1
99
Q1
00
Q1
01
Q1
02
Q1
03
$0.95
$1.05
$1.15
$1.25
$1.35
$1.45
$1.55
$1.65
Trucking Failures National Avg. Price of Diesel Fuel
Higher Diesel Prices Lead To More Higher Diesel Prices Lead To More Trucking FailuresTrucking Failures
Insurance Cost per TruckInsurance Cost per Truck
Data based on publicly held truckload carriers which disclose this information.
$4,500$4,900$5,300$5,700$6,100$6,500
1999 2000 2001 2002
70%
80%
90%
100%
110%
120%20
00:Q
1
00:Q
3
2001
:Q1
01:Q
3
2002
:Q1
02:Q
3
2003
:Q1
03:Q
3
Large TL Small TL
Truckload Driver TurnoverTruckload Driver Turnover(Quarterly Annualized Rates )(Quarterly Annualized Rates )
Industry Snapshot:Industry Snapshot:Freight MovementFreight Movement
Total Tonnage Moved:
2002 - 8.88 Billion Tons
2008 - 10.1 Billion Tons
… A 13.7% increase in 6 years.
Trucks carry 67.9% of total domestic tonnage in the U.S.
U.S. Freight Transportation Forecast…To 2014
Industry Snapshot:Industry Snapshot:RevenueRevenue
Total Revenue:
2002 - $585.3 Billion
2008 - $745.0 Billion
… A 27.2% increase in 6 years.
Trucking revenue represents 86.5% of all freight revenue
Industry Snapshot:Industry Snapshot:Firms, Employment & EquipmentFirms, Employment & Equipment
610,000 Interstate for-Hire Carriers
Total Employment:- 10.1 million employees- 3.2 million truck drivers (CDL)
2.6 Million Class 8 Trucks; 4.9 Million Trailers
Non-Trucking Freight GrowthNon-Trucking Freight Growth
Rail Trends…– 1.75 Billion Tons Moved in 2002– Estimated Annual Rail Car Tonnage
Growth
2003 – 2008: 2.2%– Rail Carload Revenue
2002 - $34.7 Billion Truck Issue: intermodal growth way up
(8.8% in Q4, ’03)
Non-Trucking Freight GrowthNon-Trucking Freight Growth
Air Cargo Trends…– 17.4 Million tons moved in 2002– Estimated Annual Tonnage Growth
2003 - 2008: 4.7%– Air Cargo Revenue
2002 - $14.1 Billion Truck Issue: Air cargo “interline” service
growing fast!
Strategic IssuesStrategic Issues
Taxes and User Fees– 2003 Annual Taxes Paid on 5-Axle Semi:
State- $4,567
Federal - $6,139
TOTAL - $10,706
New User Fees – SAFETEA & FAST Lanes
Strategic IssuesStrategic Issues
Insurance Costs– 20% - 50% increases for “good” carriers
New “Hours of Service” Regulations?
Fuel Cost Volatility– Jan. ’02 - $1.16/Gallon– June ‘04 - $2.00/Gallon
Strategic IssuesStrategic Issues
Driver Issues– HOS– Heated Economy & Wage Increases– Looming Retirements– Turn-over vs. Churning
Technology Utilization– Growing; Faster Among Large Carriers
Strategic IssuesStrategic Issues
Congestion– Problematic but solutions may be worse
Tolls Truck Bans
Security Costs??– US Patriot Act– Truck Tracking– Port Systems
Shipper-Carrier Relationships