Truck Volumes Drop Again

The impact of a second drop in truck tonnage (down 3.4% in June 2007 vs. June 2006) is rippling through the industry. The housing industry continues to be a bigger drag on motor carriage than the economy at large, according to Bob Costello, American Trucking Associations' chief economist. He poins out that the tonnage index dropped 1.8% during the second quarter while the US economy grew 3.4% in the same period.

The motor carrier industry has faced some overcapacity from equipment gains in the pre-buying of tractors to beat the 2007 emissions standards deadline. At the same time, the economy was working off some inventory build up from the second half of 2006. Equity analyst Stifel Nicolaus offered a view of some return to normalcy in the pre-holiday peak shipping season that is getting underway.

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