The fourth quarter of the year is historically a peak time for the trucking industry. However, between the snapback from last year’s high, combined with ongoing tariffs and talk of trade wars, this year may once again be an anomaly.
Last Year’s Fourth Quarter Anomaly
Last year, the trucking industry experienced revenue highs and demand for capacity vehicles. The pressure came from shippers, who were trying to move as much inventory as possible ahead of potential tariffs on goods from China and elsewhere.
The fourth quarter was indeed a revenue peak for the trucking industry, with many trucking companies making plans for growth and expanding fleets based on projections for 2019. What no one realized until well into this year was that the previous fourth quarter peak was artificially created because of the impending tariffs.
2019’s Snap Back
Part way through the first quarter of this year, the trucking industry slowed. Despite the doom and gloom reported by analysts, the truth was that the fourth quarter crunch at the end of 2018 pushed revenue and stretched the industry. In 2019, with inventory moved and shippers finding alternative sources for goods, the freight industry was relaxing back to its normal pace.
It was just that with fourth quarter demands, it seemed like things were headed to a point lower than they actually were. Unfortunately, trucking companies that were planning for major growth in 2019 had to put things on the back burner.
The End of 2019 and into 2020
Experts see growth in the trucking industry moderating as we head into 2020. Demand for capacity is lowering slightly, but the results are not dire for trucking companies with a more fiscally conservative outlook. Overall, the economy is experiencing growth, and the foundation of that growth starts with the trucking industry.
While ongoing trade talks may cause further disruption, along with new tariffs on goods coming from both Europe and Asia, production within the United States and US-based companies that have found new places overseas to set up shop to manufacture goods that will not be taxed heavily will help to continue our own growth and generate more revenue for the trucking industry.