Tariffs, weather, and talk of a new round of tax rebates are just a few of the items that are clouding economic forecasts for 2019. Will the tariffs the administration has implemented become a drain on the economy? What kind of winter will it be, and could it impact consumer spending? And, is President Donald Trump’s recent talk of new tax cuts a real possibility, and what will that do to the economy?
We don’t know the answers to any of these potential impacts right now, but carriers responding to a recent CarrierLists survey seem to have an optimistic outlook on 2019.
Almost 85% of those responding to the survey expect freight volumes to be the same or better in 2019 as they have been in 2018.
“As would be expected, this optimism carried over to rates, where 64% of carriers expect linehaul rates to show year-over-year improvements above and beyond the steep increases we experienced in 2018,” the report noted.
Of the 215 respondents – ranging from 3 trucks to 122 trucks – 31.6% believe freight volumes will be slightly better than 2018 and 27.36% expect them to be much better. Only about 17% think volumes will be slightly worse or much worse.
On the rate side, 25.58% think they will be much better and 38.14% believe 2019 will see slightly better rates. Approximately 18% see slightly worse or much worse rates in 2019.
A clear majority – 75% – expect diesel prices to continue rising. Prices nationally were $3.38 last week, according to the Department of Energy.
When it comes to the impact of tariffs, trucking leaders are split.
“For the most part it’s more of wait and see approach,” the survey noted. “One-third of carriers don’t expect it to affect volumes or rates at all. Those that do expect it to hit trucking are split right down the middle between improving and weakening the freight market.”
The survey also pointed out that 2018 was influenced by several factors, notably the strong economy, the ELD mandate and a shortage of drivers. The combination of all these have helped create the capacity squeeze that has been occurring, driving up rates.
“What are the odds we see these headwinds continue to push the market along next year?” the survey asks. “Or will a new narrative set the stage for changes in 2019?”