1/20/17

Plan for Tomorrows

Trucking Economy
Featuring:

Bob Costello, American Trucking Associa;ons

Sponsored by:

Dura>on and Strength of Recent Expansions

150
145
Q4:1982Q3:1990
(4.3%)

140
135

Q1:1991Q1:2001
(3.6%)

130
125

Q1:1975Q1:1980
(4.3%)

120

Q4:2001Q4:2007 (2.8%)
Q2:2009-today (2.2%)

115
110

(Average annual change in GDP by expansion)

105
Q3:1980Q3:1981 (4.4%)

95

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41

100

Expansion in Quarters
Sources: ATA, BEA, WSJ and NBER

1/20/17

Quarterly Real GDP &

Forecasts
2015

2.6%

6%
5.0%

5%

2016

1.6%

2017

2.3%

2018

2.6%

4.0%

4%

3.5%

3%

2.3%

2%

2.6%
2.0%

2.4%
2.0%

2.3%

2.2%

1.8%

2.0%

1.4%
0.9%

1%

0.8%

0%
-1%
-1.2%
-2%
Q1
2014

Q1
2015

Q1
2016

Q2
2017

Sources: BEA & ATA

US Labor Produc>vity
3%

Average annual growth in real output per hour

2.8%

2.8%
2.6%

2.0%

1.9%

2%

In 2016, through the

rst three quarters,
labor produc;vity is
down 0.1% from same
period in 2015.

1.5%
1.3%

1%

0%

1950s

1960s

1970s

1980s

1990s

2000s

2010-2015

Sources: BEA, BLS & ATA

1/20/17

Contribu>ons to Real GDP Growth

Percentage Points

Consump;on

4.0

Business Investment

3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
-0.5
Q1 2014

Q1 2015

Q1 2016

Sources: BEA & ATA

Business Investment During Recent

Expansions
230
215
200

1991 01 Expansion
(12.6%)

Business investment typically picks up a couple of

quarters a\er the ocial start of the economic
recovery. This chart starts at the low point for business
investment and goes through the end of the
expansion.

185
170

197580 Expansion
(11.1%)

155

198290 Expansion
(5.9%)

2001 07 Expansion (7.8%)

140

Current Expansion (5.5%)

198081 Expansion (8.7%)

125

(Average annual change in Biz Investment by expansion)

95

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41

110

Expansion in Quarters
Business investment cycles dont match economic expansions exactly.
Sources: ATA & BEA

1/20/17

Job Market
Monthly Job Changes

Unemployment Rate

(Thousands)

(Percent)

350

7.0

300

6.5
6.0

250

5.5

200

5.0
150

4.5

100

2016

2015

2016

3.0

2015

2014

3.5
2014

4.0

50

2015

2016

2017

2018

5.3%

4.9%

4.6%

4.3%

Sources: BLS & ATA

Number of Unemployed
Persons per Job Opening

6.65

7
6
5
4
3
2

1.41

1.41

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

Sources: DOL & ATA

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Real Personal Disposable Income Growth

4%

3.5%

3.5%

3.1%
3%

2%

2.7%

2.7%

2016

2017

1.6%

1%

0%
Avg 2000 - 2007 Avg 2010 - 2014

2015

Avg 2018-2019

Sources: BEA & ATA

Real Personal Consump>on Growth

(Goods Only)

5%

4.1%

4.0%

4%

3.6%

3.3%

3.9%

3.9%

2017

Avg 2018-2019

3%

2%

1%

0%

Avg 2000 - 2007 Avg 2010 - 2014

2015

2016

Sources: BEA & ATA

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Retail Sales
Retail Sales
(2016)

Percentage of On-Line Sales

10%
9%
8%
7%
6%
5%
4%
3%
2%

Brick & Mortar excludes auto sales and gasoline sta;ons

2010

2005

0%
On-Line

2000

1%
1995

Brick &
Mortar

On-line Sales have increased nearly 500% since 1995

versus 140% for core-retail sales.

Sources: Census Bureau & ATA

Personal Consump>on
Personal Consump>on (2015)
10%

Real $ 2015 Annual Growth

Rate

9%
8%
7%
6%
5%
4%
3%
2%

Goods

Health Care

Services

Air Travel

0%
Goods

Entertainment

1%

Sources: BEA & ATA

1/20/17

US Retail Sales
(Millions of $)
$60,000

Resturants and
Bars

$55,000

Grocery Stores
$50,000

$45,000

$40,000

2016

2015

2014

2013

2012

2011

$30,000

2010

$35,000

Source: Census Bureau

Housing Starts Are Leveling O At a Sustainable Pace

Housing Starts

New Permits

0.400

H.S.

2015

2016

2017

1.11 M

1.15 M

1.23 M

2016

0.500

0.400

2015

0.600

0.500

2014

0.700

0.600

2013

0.800

0.700

2012

0.900

0.800

2016

1.000

0.900

2015

1.000

2014

1.100

2013

1.200

1.100

2012

1.300

1.200

2011

1.400

1.300

2010

1.400

2011

(Monthly; Annualized Rate; Millions)

2010

(Monthly; Annualized Rate; Millions)

Sources: Census & ATA

1/20/17

Home Construc>on Has Flipped to Single-Family

Housing Starts

(Monthly; Annualized Rate; Millions)

1

Single-Family

0.9
0.8

+40%

Mul;-Family

0.7
0.6

-50%

0.5
0.4
0.3
0.2

2016

2015

2014

2013

2012

2011

2010

0.1

Sources: Census & ATA

Factory Output
Level of Output (2012=100)
106

Year-over-Year Growth
10%

104

8%

102
6%

100
98

4%

96

2%

94

2016

2015

2014

2013

2012

-2%

2011

2016

2015

2014

2013

2012

2011

2010

90

2010

0%

92

Sources: Federal Reserve & ATA

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ISM Factory Index

60
58
56
54
52
50
48
46
44

2016

2015

2014

2013

2012

2011

40

2010

42

Sources: Ins>tute for Supply Chain Management & ATA

Factory Jobs vs Factory Output

Index; January 1990 =100

200

Jobs
Output

190
180
170
160

+75%

150
140
130
120
110
100
90

-31%

80
70
60
50
1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

Sources: Department of Labor, Federal Reserve and ATA

1/20/17

Total Business Inventory-to-

Sales Ra>o

(Data adjusted for seasonal, holiday, and trading-day dierences, but not price changes)

1.55
1.50
1.45
1.40

Likely Op;mal Range

1.35
1.30
1.25
1.20
1.15
1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

Source: Census Bureau

Truck Freight Trends

10

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Total TL Loads

Index: 2000=100; 3-Month Moving Average

Includes Dry Van, Flatbed, Temp Controlled, and Tank Truck

Source: ATAs Trucking Ac4vity Report

Total TL Loads

Year-over-Year Percent Change in 3-Month Moving Average

Includes Dry Van, Flatbed, Temp Controlled, and Tank Truck

Source: ATAs Trucking Ac4vity Report

11

1/20/17

TL Loads By Trailer Type

Year-over-Year Change

8.0%

7.6%

7.0%

2016 YTD

6.0%

November

5.5%

5.0%

4.3%

4.0%

3.3%

3.0%
2.0%

1.1%

1.1%

1.0%

0.1%

0.0%

0.0%
Dry Van

Flatbed

Temp
Controlled

Tank

Source: ATAs Trucking Ac4vity Report

Total TL Miles

Index: 2000=100; 3-Month Moving Average

Includes Dry Van, Flatbed, Temp Controlled, and Tank Truck

Source: ATAs Trucking Ac4vity Report

12

1/20/17

Total TL Miles

Year-over-Year Percent Change in 3-Month Moving Average

Includes Dry Van, Flatbed, Temp Controlled, and Tank Truck

Source: ATAs Trucking Ac4vity Report

Source: ATAs Trucking Ac4vity Report

13

1/20/17

Dry Van Average Length-Of-Haul is Down

796 miles

Source: ATA

LTL Tonnage

Index: 2000=100; 3-Month Moving Average

Source: ATAs Trucking Ac4vity Report

14

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LTL Tonnage

Year-over-Year Percent Change in 3-Month Moving Average

Source: ATAs Trucking Ac4vity Report

Capacity Trends

15

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Thousands

US Retail Class 8 Truck Sales

Includes Tractors & Straight Trucks

Source: ATAs American Trucking Trends 2016 & ACT Research

104
102
100

TL Annual Tractor Capacity Trends

TL Tractor Capacity (2010=100) 102.5
101.6
100.0

99.8

2010

2011

102.4

102.6

2015

2016

100.5

98
96
94
92
90

2012

2013

2014

Source: ATAs Trucking Ac4vity Report

16

1/20/17

TL Tractor Changes: Large vs Small Fleets

7.0%
5.0%

2015

4.0%

5.2%

2016 YTD

3.0%
1.0%
-1.0%

-0.2%

Small Fleet: Less than $30 million in

annual revenue

-3.0%
-5.0%

-4.9%
Large TLs

Small TLs

Source: ATAs Trucking Ac4vity Report

Used Class 8 Truck Prices & Average Miles

Source: ACT Research

17

1/20/17

Impact of ELDs
1. Truckstop.com survey of 1,300 carriers, with vast
majority opera;ng fewer than 6 trucks, 84% had no
ELDs on any trucks. Less than 50% of trucks have ELDs
and it is likely less than 40%.
2. TL eets that have already adopted are generally
larger and more sophis;cated than most of those that
havent. So, produc;vity impact could be larger than
eets have seen so far.
3. What if just 1% to 3% of drivers leave the market for
a host of reasons, including cheaters, an;-technology,
an;-big government, or just dont want to change?
4. Some carriers are likely to exit the industry.

Source: ATAs Trucking Ac4vity Report

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1/20/17

Thanks

Twijer: @ATAEconBob

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