Trucking companies are tackling the boom from freight growth last year as it is estimated that more availability on major dances and the softening demand on earnings before peak shipping season.
Many carriers plowed the 2018 profits and the gains from the 2017 corporation tax which were charged to record orders for new equipment, leaving the supply of trucks growing and freight volumes in the US stages.
Bad weather, tepid industrial growth and trade tension have contributed to a sagging business, cargo officials say. Companies that have attracted imports late last year ahead of the projected tariffs are working through excess inventory that was put up in warehouses, and offers cool damper temperatures on spring shipments products, drinks and patio furniture.
“We have a three-month recession,” said Jack Atkins, transport analyst with Stephens Inc..
It has been a major recession since last year, when retailers and manufacturers have been scrapping to reserve transport due to freight volumes and rigid truck capacity. A number of companies targeted shipping costs soaring as low earnings as carriers with double-digit rate increases.
Now lighters have the upper hand. The results have been particularly dramatic on the ground, where companies place the last minute behavior and prices in a more volatile location than the contracted rates of trucks negotiate with customers.
The average on-market market price for hiring a large rig was 18.5% in June from the same month a year ago, to $ 1.89 per mile, according to the online freight market DAT Solutions LLC. Last month on the DAT platform there were about three loads for each truck available, compared to six loads per truck in June 2018.
“The truck industry bought much more than we realized,” said Doug Wagoner, chief executive of freight broker Echo Global Logistics Inc., in a 24 July earnings call. “Compared to last year at this time, there is less demand for capacity and, coupled with an over supply of trucks, it means that there are few shipments and that all truck prices have fallen dramatically.” T
Knight-Swift Transport Holdings
North America's largest truck carrier reduced its profit potential for the second and third quarters, stating that “the over-supply of capacity in the truck cargo market” was weighed down the income per thousand loaded, main measure pricing strength measurements.
Phoenix-based Knight made a $ 1.24 billion log in second quarter income, a 6.7% decrease from the same quarter a year ago, and adjusted operating income increased by 1.5% to $ 137 million, excluding factors, including legal accrual attached. with an ongoing procedure.
Lowell, based on the Ark
J.B. Hunt Transport Services
one of the largest US freight operators said that its income increased by 6% to $ 2.26 billion, while operating income exceeded 10% by higher costs, exceeding the analysts estimates.
Drivers also pointed to other large hip sideways from slowing demand in the second quarter.
said its second quarter income increased by 1%, to $ 627.5 million, but the carrier Omaha, Neb, reduced his 2019 perspective for a one-way truck pricing, saying he was expecting the rates to be equal to down 3 %.
Carrier executives say they are expected to improve the capability in the coming months, focusing on increased cancellation of truck orders and dowry of bankruptcy among smaller regional carriers.
But manufacturers are still working through a long backlog of orders and fleets continuing to deliver new trucks, said Kenny Vieth, president of the transport industry data provider ACT Research, which tracks equipment orders including Class 8 trucks, Large rigs are used to draw cargo over a long length of time.
“Freight as we measure it is growing at less than 1% in 2019,” said Mr Vieth. “Our modeling suggests that we are contributing about 7% to the United States. Class 8 market capacity…. So the supply-demand balance is talking away from lorry drivers now. ”
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