Capacity glut challenging truck market: ACT

COLUMBUS, Ind.  – Key truck transportation metrics continue to give mixed signals in early 2020, according to ACT Research’s recently released Transportation Digest. The report said that the total medium-duty market closed 2019 on a positive note, with all indicators improving sequentially in December. It said the U.S. trailer segment closed 2019 on weak net orders, well below seasonal expectations.

“The core challenge in the heavy truck market in 2020 is that significant capacity was added in 2019 relative to freight growth. That imbalance is reflected in today’s weak rate environment,” said Kenny Vieth, ACT’s president and senior analyst. “As the economy and freight slowed in 2019, the capacity excess put asset holders on the defensive and gave shippers a big edge in 2020’s rate negotiations.”

He also said that 2020 will be a “capacity rationalization year,” that will go a long way in restoring the supply-demand balance between trucks and freight.

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