Overall U.S. freight outlook tonnage will rise nearly 25% and revenues from that freight will surge above 70% over the next decade, per the latest long-term freight forecast released by the American Trucking Assns. (ATA).
The ATA U.S. Freight Transportation Forecast to 2025 predicts further growth not just for trucking industry, but for the entire freight economy, according to ATA chief economist Bob Costello.
“We continue to see growth in our freight outlook– but we also see that trucking will maintain its position as the nation’s dominant mode of freight transportation,” Costello commented.
Forecastwas produced by ATA in collaboration withIHS Global Insight.
Forecast also breaks down in their freight outlook how movements shape up regionally, by both percentage of inbound and outbound tonnage.
“Truck freight generated nearly $682 billion in revenue last year, which is a new record,” stated Costello in introductory remarks to Forecast.
“According to IHS Global Insight,” he continued, “total truck tonnage, including for-hire and private carrier operations, hit 9.68 billion tons in 2013, the highest level since 2008. As of last year, total tonnage was up 13.6% from the low in 2009.”
Costello remarked that “despite the slow [economic] recovery so far, the long-run freight outlook still remains bright for nearly all modes.”
He added that key contributors to the projected “robust growth” will involve “many factors,” including trends in manufacturing, consumer spending and international trade.
The 75-pg freight outlook report sums up the basis for its rosy forecast by pointing to numerous positive factors that are expected to play out over the next eleven years.
For starters, Forecast expects U.S GDP to improve in the years ahead, with growth of 2.9% realized in 2014 to 2019 and of 2.4% in 2020 to 2025.
“The domestic economy remains the driving force behind the performance of the nation’s freight pool, with foreign trade playing a secondary, but significant and growing role,” the report’s authors assert.
What’s more, they contend that “if we are right about the future path of the U.S. and global economy, the nation’s freight pool could grow by 23.5% over the 12 years from 2014 through 2025.”
More specifically, per the report, a “cyclical snapback” in housing and construction from 2014 to 2016 will help support freight tonnage growth of 16.6% from 2014 to 2019. In addition, it noted that general commodities will continue to expand at a “faster pace” than bulk commodities.
As for the negative side of things, the authors of Forecast point out that, “Healthy long-term growth in the United States cannot be maintained without healthy spending on the transportation infrastructure, state-of-the art equipment, and technology.”
They conclude by stating that their freight outlook forecast “remains vulnerable to ‘shocks to the system,’ such as a territorial dispute with China involving its neighbors or the United States; a worsening of the already dicey situation in the Middle East; an oil supply crisis that would send crude-oil prices spiraling higher, or [the occurrence of] major natural disasters.”
Forecast may be purchased as a bound voluume or as a downloadable PDF.
If the future freight outlook seems strong, then so will the need for shippers to look to the future by employing outside expert help from third party logistics providers. Now is not the time for shippers to waste valuable non-core resources. Shippers however, will need to understand their own operations and reasons for outsourcing. This will better enable them to evaluate what the third-parties are telling them. In that regard, the following bullet points out why you may want to outsource to a 3PL in order to maintain as you grow without adding additional resources to scale:
All these are good and positive reasons. However, there are even more to the point reasons of compliance and simple economics:
Given the differences in logistics service providers and the differences in why shippers outsource, we strongly suggest that the shipper look hard at both the provider alternatives and its reasons for outsourcing. It must ask some difficult questions:
Once you’ve determined your own needs, you can then begin to look for a 3PL provider that has the specific capabilities and services it needs. These questions will help shippers evaluate potential service providers:
A company looking to outsource its logistics operations, or a portion thereof, must thoroughly understand what they are doing and what they want to accomplish. There are no shortcuts to doing it right, but there are real problems in doing it wrong. Don’t have anxiety however, set up a free logistics consultation with one of our Account Executives today.
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