The “Freight Transportation Forecast: 2020 to 2031,” was released this week by the American Trucking Associations (ATA) and conducted by IHS Markit. This publication is described by the ATA as an annual projection of the state of the freight economy.
ATA highlighted various key takeaways of this year’s edition of the Freight Transportation Forecast, including:
- total freight volumes in 2020 are likely to collapse by 10.6% to 14.6 billion tons, although truck freight volumes falls a smaller 8.8%;
- trucking volumes are expected to rebound in 2021, rising 4.9% next year and then growing 3.2% per year on average through 2026; and
- overall freight revenues in 2020 will total $879 billion, rising to $1.435 trillion in 2031
To be sure, these figures, especially the first one, which focuses on total freight and trucking volumes, show the impact of COVID-19 on demand and production, with volumes essentially falling off of a cliff for a prolonged period before showing signs of a recovery. The good news, though, is that a subsequent rebound is expected.
Low retail inventories and a healthy spot market have contributed to improved expectations for the second half of 2020 as the freight market tightens “The COVID-19 pandemic has had an unprecedented impact on many parts of the economy and trucking is no exception,” said ATA Chief Economist Bob Costello in a statement. “However, despite significant contractions in 2020, the forecast makes it clear that the long-term trend for trucking, as well as for the overall freight economy is positive.”
In a recent webinar, Seth Holm, senior research analyst for FreightWaves, said U.S. GDP declined by a record 32% in the second quarter, but the trucking industry is “booming.” Overall, consumer spending is flat, with goods spending up and services spending down. That makes for an ideal backdrop for the trucking industry, he said.
According to senior research analyst Benjamin Hartford and research associate Andrew Reed, both of Baird, the strength in the freight industry continues to rise, especially on the West Coast and in Southern California.