ATA truck tonnage index fell in July

ARLINGTON, Va. (Aug. 22, 2013) — The American Trucking Associations' advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index slipped 0.4 percent in July after edging 0.1 percent higher in June.

The ATA said June's increase was the same as the association reported on July 23. The latest drop was the first since April. In July, the SA index equaled 125.4 (2000=100) vs. 125.9 in June—which hit the highest level on record since the organization has calculated results. Compared with July 2012, the SA index increased 4.7 percent, which is robust, according to the ATA, although it was the smallest year-over-year gain since April. Year-to-date, compared with the same 2012period, the tonnage index is up 4.7 percent.

The not seasonally adjusted index—which represents the change in tonnage actually hauled by fleets before any seasonal adjustment—equaled 129.6 in July, which was 3 percent above the previous month (125.9).

ATA Chief Economist Bob Costello explained that "after gaining a total of 2.2 percent in May and June, it isn't surprising that tonnage slipped a little in July.

"The decrease corresponds with the small decline in manufacturing output during July reported by the Federal Reserve last week."

Despite the "small reprieve in July," he continued, "we expect solid tonnage numbers during the second half of the year as sectors that generate heavy freight, like oil and gas and autos, continue with robust growth.

"Home construction generates a significant amount of tonnage, but as mortgage rates and home prices rise, growth in housing starts will decelerate slightly in the second half of the year, but still be a positive for truck freight volumes. Tonnage gains in the second half of the year are likely to overstate the strength in the economy as these heavy freight sectors continue to outperform the economy overall."

Each month, the ATA asks its membership the amount of tonnage each carrier hauled, including all types of freight. The indexes are calculated based on those responses. The sample includes an array of trucking companies, ranging from small fleets to multi-billion dollar carriers.

When a company in the sample fails, the ATA said it still includes that firm's tally for its final month of operation and then zeros it out for the following month, with the assumption that the remaining carriers pick up that freight. "As a result, it is close to a net wash and does not end up in a false increase," according to the ATA. "Nevertheless, some carriers are picking up freight from failures and it may have boosted the index. Due to our correction mentioned above however, it should be limited."

The Arlington-based trade group noted that "trucking serves as a barometer of the U.S. economy, representing 68.5 percent of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods. Trucks hauled 9.4 billion tons of freight in 2012. Motor carriers collected $642.1 billion, or 80.7 percent of total revenue earned by all transport modes."

Since the 1970s the ATA has calculated the tonnage index based on surveys from its membership, though this is a preliminary figure and subject to change in the final report issued around the tenth day of the month, the organization said. The report includes month-to-month and year-over-year results, relevant economic comparisons and key financial indicators.

The ATA is the largest national trade association for the trucking industry, comprising a federation of 50 affiliated state trucking associations and industry-related conferences and councils,