As promised in our Graphic of the Week feature last week, you are going to see increased use of our cool new interactive "web chart" technology in a variety of ways over coming months. This week, another such chart looking at changes in the US transportation sector.
The graph plots two monthly indices: (1) the Freight Tonnage Index from the American Trucking Associations; and (2) the Linehaul Rate Index from Cass Information Systems, which tracks per mile rates for truckload carriage in the US before any accessorials or fuel surcharges.
The chart begins tracking both indices in March 2008, just about when the economic slowdown began, we now know, before the bottom fell out in the Fall of that year. (Note: tools at the top and the bottom of the chart allow you to adjust the time period for analysis. Mouse over the graph to see individual data points; You can also export a jpeg image in the upper right of any particular view of the data.)
The base year for the ATA Index (where the index is set at 100) is 2000, and it is seasonally adjusted; it is January, 2005 for the Cass index, which is not seasonally adjusted (which makes sense).
From this chart, we make several observations:
1. Tonnage bottomed along with most everything else in the middle months of 2009, when the index dipped to about 98, meaning freight volumes were at or below 2000 levels for several months. Rates, however, didn't bottom until April, 2010, when at a index level of 95 they were 5% below early 2005 rates, and about 9.3% below the peak before that in Jan. 2009. It is important to note that the Cass Index is based on actual rates paid, data gathered from the company's freight payment service, and thus would often be a lagging indicator, because many companies of course are paying off of contracted rates negotiated in different conditions in terms of supply-demand balance. So the 2010 bottom may likely have resulted from low price contracts signed in 2009.
2. The largest divergence between volume growth and rates was also in the first half of 2010, when volumes were modestly increasing but rates were still headed south, which can be explained via contract cycles as noted above.
3. Freight volumes have generally move up consistently since June, 2009 (thought by many to be the real bottom of the recession), reaching a peak of a score (and all-time high) of 124 in December of 2011. Rates have moved up even more sharply since mid-2010, peaking at a level of 109.4 in January of this year. That means rates are up 9.4% over the base period of January of 2005, and about 15% from the 2010 rate bottom.
4. The trends in both volumes and rates have been flat to down slightly so far in 2012, consistent with other reports of a slowing economy, but just barely. Volumes are down about 6% through May of this year, but that is with a bit of an outlier in December, when it rose unusually sharply. Since January, both volumes and rates are down about 1%.
5. As of May, freight volumes are up just about 18% over 2000 levels, and about 20% over the 2009 bottom.
Any other insights? Play around with the chart, and let us know what you find!