An article this week in Heavy Duty Trucking‘s Truckinginfo blog details a session at the American Trucking Associations’ Management Conference and Exhibition over the weekend in Las Vegas. In a session hosted by ATA Chief Economist Bob Costello, he and his guest Diane Swonk, Analyst, Founder & CEO of DS Economics.
The consensus was there is still uncertainty about the economy given the coming election and sluggish current conditions. However, there is reason for hope as business conditions are showing some signs of improvement for the transportation industry. According to Swonk, the American economy is at a “turning point,” meaning business conditions are expected to rebound from their current “subpar growth” for several reasons.
One, she said, consumers are “holding their own,” meaning they are continuing to spend, which helps drive a lot of freight movements. Two, job growth has been fairly strong, although Swonk believes there are still people sitting on the sidelines.
Both Swonk and Costello attributed the sluggish economy to a lack of disposable income in general along with a preferences by large demographic groups like the Millennials towards services rather than products. Fewer products purchased means fewer products shipped from manufacturers or store to customers. There seems to be some optimism that things are turning around.
Though corporations engaged in a “dearth of investment” early, and are putting off capital expenditures until later, business seems to be slowly picking up. Part of the reason is the energy sector as Swonk feels oil prices are just about at a “sweet spot” where oil companies can make a reasonable profit including the funding of more expensive projects such as horizontal drilling. Yet, consumer gas prices are still very reasonable encouraging folks to travel, or to take jobs which involve longer distances.
So why are we publishing this? Simple, more business means more trailer needs. We maintain a line of new trailers which have never been driven but have been brought to historically low prices. If that’s still too much then there are plenty of used trailers in good condition out there which we can and do get our hands on from time to time.Businesses we talk to are beginning to need, and buy, some capital resources but are taking a very frugal approach in doing so. Bargains are available and good bargain hunters are finding them and snapping them up. From other articles around the inter-webs which are similar to this one, the general consensus is that it’s time and things are starting to move again. Don’t misss out, and of course, let us know how we can help.
The article referenced is chalk full of information about where Costello and Swonk feel things are headed. Read it here.