FTR’s Trucking Conditions Index posts highest reading since February 2022

The new edition of the Trucking Conditions Index (TCI), which was recently issued by freight transportation consultancy FTR, posted a strong sequential rebound.  

According to FTR, a TCI reading above zero represents an adequate trucking environment, with readings above 10 indicating that volumes, prices and margin are in a good range for carriers.

And it explained that the TCI tracks the changes representing five major conditions in the U.S. truck market. These conditions include: freight volumes, freight rates, fleet capacity, fuel prices, and financing costs. Individual metrics are combined into a single index indicating the industry’s overall health. A positive score represents good, optimistic conditions. And 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.

For May, the most recent month for which data is available, the TCI came in at 3.56, its best reading going back to February 2022, well above April’s -0.81 and March’s 0.28 readings. This followed a -0.21 February reading, which marked an improvement over January’s -2.56 reading, and nearly erased all of the growth seen in December, which posted a 2.67 reading. Which was preceded by November’s 3.02, its highest reading going back to April 2022.

FTR said that even though May’s TCI reading was strong, it is viewed as an outlier adding that the near-term outlook calls for negative or near-neutral market conditions for carriers.

“The unusually robust TCI reading in May—certainly by the standards of the past couple of years—speaks more to the volatility of market conditions than it does improvement,” said Avery Vise, FTR’s vice president of trucking. “The index’s largest positive factor was falling diesel prices, which was not the situation in June or July, of course. Nor do we expect May’s big improvement in freight volume to be sustained. As we have noted, the supply chain’s efforts to anticipate and respond to changing tariff policies and other uncertainties make it difficult to get a firm read on the truck freight market’s trajectory. We still expect the start of a modestly more favorable market for carriers by early next year, but, frankly, we still see significant risks both to the upside and downside.”