DAT Truckload Volume Index: Can’t Keep Up With Demand
As the economy continues to recover from the ongoing coronavirus pandemic, one of the industries hit the hardest has been the trucking industry. Understanding the unique challenges this industry is facing can help businesses around the United States better understand why they’re having a problem meeting their time-critical shipping needs. In today’s article, we will go over recent DAT Truckload Volume Index reports, what they mean, and how they may impact your business.
What is the Data?
The DAT Truckload Volume Index (TVI) looks at the change in the number of loads with a pickup date during the month, with a baseline of 100, equal to the number of loads in January 2015. This index measures dry van, refrigerated, and flatbed trucks moved by truckload carriers. These numbers are released monthly and provide a detailed look into trends in the shipping industry.
The higher the TVI, the higher the demand. As you may expect, the TVI readings in recent months have been at all-time highs. This is due in large part to increased consumer spending. While this may seem like a positive sign that the economy is recovering, shipping companies do not have the means to meet these increased demands. This is why you may notice shipping times taking longer than usual.
What Does the Data Say?
Now that we know what the data means, what does it say? The June reading for the TVI came in at 237, a new record. This was an 11% increase compared to May’s 212 reading, which was the fourth-highest month on record. Keep in mind, the baseline TVI reading is 100, which was the number of loads in January 2015. This shows the meteoric rise in demand in recent months.
Of course, a big reason why there was such an increase in June is July 4th preparation. June also represents the end of the second quarter of the year, which leads to an increase in volume. Even with this in mind, experts believe this increase is still higher than what you would expect from a long-term trend perspective.
How Are Trucker Companies Responding?
As mentioned at the top of the article, trucking companies are having a hard time keeping up with this increase in demand. In response, they are raising their prices in an effort to lower their transactions. While this may seem like a baffling move, doing so helps these companies return the capacity back into the routine guide. Logistics Management lists some of the changes in prices as follows:
- Truckload van rate was $2.68 per mile in June – a $0.01 decrease from May’s all-time-high rate of $2.69.
- The refrigerated spot rate was $3.10 per mile in June – only the second time in history the rate topped the $3 per mile mark.
- The average spot flatbed rate was $3.15 per mile – just like the refrigerated spot rate, this was only the second time this rate topped the $3 per mile mark.
- Contract truckload rates set records for all three equipment types – van rate was $2.73 per mile, contract refrigerated rate was $2.88 per mile, and contracted flatbed rate was $3.10 per mile.
Did the increased rate help trucking companies? To put it bluntly – no. Experts believe the increased contract rates to remain high throughout the holiday season.
Let Us Handle the Headaches
Dealing with the increased shipping costs and the stress of delayed orders can drive even the sanest person mad. That’s why our team here at Trifecta Transport is here to help. We can handle all of your logistics needs, so you don’t have to. Contact us today to find out how our services can make your life easier.