Truck freight volumes are expected to grow over the next decade

Truck freight volumes are expected to grow over the next decade

Forecasts released by the American Trucking Associations (ATA) on Wednesday show that truck tonnage will grow to 14.2 billion tons by 2034.

ATA’s chief economist, Bob Costello, noted that the agency’s latest forecast keeps trucking, which moved 72.2% of total freight tonnage and represents 79.2% of revenue in 2022, at the top of the U.S. freight transportation pyramid.

“This market share will continue to hold steady over the next decade, as the country will still rely on trucking to move the vast majority of goods,” Costello said.

Costello expects total truck tonnage to grow from approximately 11.3 billion tons this year to 14.2 billion tons in 2034, representing 72.4% of freight tonnage in 2023 and 72.6% of tonnage at the end of the forecast period. Trucking revenues will grow from $1.01 trillion in 2023 to $1.51 trillion in 2034, which will represent 78.8% of the freight market.

In the face of the continued shift of some highway freight operations to intermodal rail, ATA expects intermodal rail revenue to grow from $21.7 billion in 2023 to $35.2 billion in 2034. With bulk coal and petroleum shipments dwindling over time The load capacity of railway cars will decrease by 11%. Total freight growth will reach 10.1% by 2034, ATA said.

Air freight tonnage is expected to grow from 17.6 million tons this year to 23.7 million tons in 2034. Pipelines will see their share of freight tonnage increase from 9.8% in 2023 to 10.4% in 2034.

“Knowing where our industry and economy is headed is critical for decision makers,” said Chris Speer, president and CEO of ATA. “This freight forecast should be at the forefront of policymakers’ minds in Washington, Sacramento and wherever decisions affecting trucking are made.”

Long road to recovery

The ATA’s forecast comes as trucking companies work to dig themselves out of historically tough times.

Truck operating costs are much higher than spot prices. The margin between cost and contract rates, which continues to decline and is about 16% lower year-on-year, is positive but narrow.

Real spending on goods is on the rise after two years of stagnation, according to Uber Freight’s update and market outlook for the fourth quarter of 2023. In the third quarter, spending rose 0.5% quarter-over-quarter and 2.3% year-over-year. The strength was driven by durable goods (+1.1% QoQ), especially automobiles. Consumers are saving less to spend more: The personal saving rate fell to 3.4% in September, half its pre-pandemic level.

Demand for truckloads, After increasing steadily through 2023, It turned positive on a yearly basis for the first time in 9 months. Truckload demand likely bottomed out in April 2023, according to an Uber Freight report, and then increased in the following months. In the third quarter, it rose 1.2% quarter-on-quarter, and was flat year-on-year. Meanwhile, supply fell 0.5% in the third quarter, but was still 1.4% higher than a year earlier. The industrial economy contracted for the 12th straight month, according to the ISM Purchasing Managers’ Index.

Trucking employment fell by 24,000 (-1.5%) in the third quarter, reflecting Yellow’s bankruptcy. In October, the number dropped further by 5,000, according to Uber Freight, and was 1.7% lower year over year. Long-haul truckload employment, a better indicator of spot rates, also declined, but is still only 1.1% below its all-time high.

LTL tonnage continued to decline in the third quarter, according to Uber Freight, but individual carrier tonnage showed signs of improvement in September due to Yellow’s shutdown. Light tonnage and the number of shipments are expected to remain at low overall levels through the end of the year and into next year, and average shipment volume continues to decline.

Jason Cannon has written about trucking and transportation for more than a decade and serves as the magazine’s editor-in-chief Commercial Carrier Magazine. Jason is a Class I CDL holder, a graduate of the Porsche Sports Car Driving School, an honorary Duckmaster at The Peabody in Memphis, Tennessee, and a purple belt in Brazilian Jiu-Jitsu. Contact him at (email protected).

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