Consumer confidence rose in October, according to the Thomson Reuters/University of Michigan consumer sentiment index released Friday.
The month’s preliminary index reading rose to 83.1, the highest since September 2007, from 78.3 the previous month, the survey said.
Economists had forecast the index would fall to 78, Bloomberg reported.
The survey’s index of current conditions asks Americans if they are better off than they were a year ago and if it is a good time to buy big-ticket items.
NASHVILLE, Ind. -- FTR's Trucking Conditions Index (TCI) declined to a reading of 3.4 in October. The environment for truckers as measured by the TCI softened primarily due to further delay in the issuance of revised Hours-of-Service regulations, according to FTR officials. "This is affecting the near-term outlook for capacity and therefore the current ability of carriers to gain rate increases," FTR said in a release.
FTR is projecting the TCI to increase as capacity conditions tighten, but the peak has been moved back from April to October of next year, reflecting the regulatory delay. The Trucking Conditions Index is a compilation of factors affecting trucking companies and has remained in positive territory for the past eight months. Any reading above zero indicates an adequate trucking environment with readings above 10 a sign that volumes, prices and margin are in a good range for trucking companies.
"There was a considerable drop of six points in the TCI in October. Some of this drop was a result of changes in our methodology for calculating the TCI as we continue to refine this measurement," said Larry Gross, senior consultant for FTR.
"Although October's TCI reflected the rather subdued nature of the fall peak at that point in time, the recent strong start to the holiday shopping season combined with retailers' lean inventories cause us to believe that the TCI will soon resume climbing even in the absence of near-term changes in Federal regulations. The addition of any such changes, now expected to be announced by year-end, will exacerbate the trend."
Construction spending rose 0.8% in October, the third straight monthly increase, the Commerce Department said Thursday.
The increase followed a 0.2% gain in September, Commerce said.
The October upturn was larger than economists’ forecasts of a 0.3% increase, Bloomberg reported.
Private construction spending climbed 2.3%, while homebuilding spending gained 3.4%.
Public construction spending fell 1.8%. Federal construction spending dropped 5% in October to $26.4 billion, the lowest level since May 2009.
Construction spending can boost demand for trucking services because spending increases the number of shipments of goods and building materials.
COLUMBUS, Ind. -- Reported volumes of used Classes 3-8 truck sales slipped back into negative territory in October, after enjoying a recovery in September, according to a report from ACT Research.
ACT officials say scarce inventory and sustained demand may be the cause.
"Despite continued improvement on the new truck sales side, along with repeated assurances that carriers are not expanding their fleets, expected trade-ins have yet to provide any relief to the growing equipment shortage," said Steve Tam, vice-president, commercial vehicle sector, with ACT.
"Special programs in the late 1990s and early 2000s that lured traditional used truck buyers into new truck purchases are no longer in effect, so the demand for used equipment continues to expand."
Consumer personal spending edged up 0.1% in October, the Commerce Department said Wednesday.
The slight increase followed a revised 0.7% gain in September that was larger than previously estimated.
The October gain was below economists’ forecasts of a 0.3% increase, Bloomberg reported.
Personal incomes rose 0.4%, the largest increase since March, after rising 0.1% the previous month.
A rise in consumer spending could increase demand for new factory goods and the trucking shipments that get them to stores.
COLUMBUS, Ind. -- ACT Research has reported demand for Class 8 trucks reached a six-month high in October.
Class 8 net orders rose to 28,026 units in October, indicating 2011 will end on a strong note with production of about 250,000 Class 8 units on the year, setting the stage for a "robust" 2012.
"News from carriers is good," said Kenny Vieth, president and senior analyst at ACT. "Expectations for future freight and profitability are upbeat. Coupling truckers' positive outlook into 2012 and the better than consensus economic news supports demand levels that we are seeing in the Class 8 market."
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Industrial production rose 0.7% in October, led by a gain in automobile output, the Federal Reserve said Wednesday.
The increase in output from factories, mines and utilities followed a revised 0.1% decline in September that had originally been reported as a 0.2% gain.
The October reading was higher than economists’ projections of a 0.4% increase, Bloomberg reported.
Factory production, which makes up three-quarters of the total, rose 0.5%, the biggest gain in three months.
Production of automobiles and parts increased 3.1%, while factory production excluding autos rose 0.3%.
Capacity utilization, which measures plant output, rose to 77.8%, its highest level since July 2008, from a revised 77.3% in September.
Manufacturing accounts for about an eighth of the U.S. economy and the factory sector is one of trucking’s largest and most important customers.
The monthly Cass freight index said October shipment levels grew 2.2% over the same month last year, while shipper expenditures jumped 16.1%.
The index covers all modes of freight transportation.
Although both parts of the index grew year-over-year, they also contracted sequentially from September, although Cass said that is a typical seasonal pattern.
“The numbers appear to show that efforts by carriers to push up rates and recover increases in operating costs appear to be sticking,” the report said.
“The result is that while the weight of a shipment, averaged across all modes, has risen about 1%, year-over-year, the cost of transporting that average shipment has escalated dramatically.”
COLUMBUS, Ind. -- North American Class 8 commercial vehicle preliminary net orders for October surprised on the upside, improving both month-over-month and year-over-year, according to ACT Research. The final numbers, which will be released mid-November, will approach 27,700 units for heavy-duty Class 8 trucks and 13,300 for medium Classes 5-7 vehicles. The preliminary net order numbers are typically accurate to within 5% of actual.
"At this level of order activity, there is probably some incremental fleet growth taking place," said Steve Tam, vice-president, commercial vehicle sector, ACT. "The underlying fundamentals in the heavy truck market are all healthy. Fleet equipment is old, trucker profitability is good, used truck values are strong, and financing is generally available. The strength in orders supports ACT's forecast for next year."
Welcome to the FREE October 2011 issue of Truckstop News. All pages of the paper are available to download right here.
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Tags: 2011, 289, October, Truckstop News
