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  • Morgan Stanley Graphs

    Morgan Stanley refrigerated index shows very tight capacity

    - by Tom Sanderson

    Morgan Stanley’s refrigerated truckload freight index has fallen off somewhat from the pace of Q2 2010 indicating more readily available capacity at this time compared to Q2. Refrigerated capacity continues to be very tight relative to 2009 and to most other recent years. The exception is the hurricane-induced capacity shortages at the end of 2005. The last two months have shown increasing tightness of refrigerated capacity. The pricing environment in this segment clearly favors the carriers at this point. The index measures incremental demand for refrigerated truckload services compared to incremental supply. The higher the index the tighter is capacity relative to demand when compared to a prior period.

    Graph reproduced with permission from Morgan Stanley. For more information contact: Adam Longson at Adam.Longson@morganstanley.com or Bill Green at William.Greene@morganstanley.com

  • Morgan Stanley Graphs

    Morgan Stanley dry van truckload index continues so show no tightening of capacity

    - by Tom Sanderson

    Morgan Stanley’s dry van truckload freight index continues at moderate levels, compared to the tighter capacity environment in Q2 2010. While capacity remains tighter than in 2009, the spread between 2009 and 2010 is narrowing and the current index is below the 1995-2008 average. The index measures incremental demand for dry-van truckload services compared to incremental supply. The higher the index the tighter is capacity relative to demand when compared to a prior period. In Q2 it was starting to look like we may see a repeat of the TL capacity shortages of 2004 and 2005, but at this point the graph is tracking very closely to 2006 and 2008 which were strong through Q2 and then plunged toward the end of the year.

    Graph reproduced with permission from Morgan Stanley. For more information contact: Adam Longson at Adam.Longson@morganstanley.com or Bill Green at William.Greene@morganstanley.com

  • Retail & Same Store Sales

    Same store sales data illustrates weakness in retail sector

    - by Tom Sanderson

    Same store sales data shows ongoing weakness as only one for the top 10 retailers posted growth of more than 3%; Costco at 5.0%. Three of the top 10 showed declining same store sales in their most recent reporting period including giant Wal-Mart. The data is consistent with overall retail sales numbers, but it brings home the message to see how even the best retailers are struggling to achieve adequate sales growth. The outlook has improved from 2009 when same store sales for the same reporting period showed much worse results than 2008. Only 4 of these retailers posted same store sales growth for this reporting period in 2009 over 2008. The retail segment drives a tremendous amount of freight transportation and this data shows that demand for freight transportation is likely to remain weak in the near term.

     

    Source: www.retailerdaily.com , www.stores.org , Transplace analysis, excludes fuel sales.

  • Retail & Same Store Sales

    Retail sales remain flat and year-over-year comps deteriorate

    - by Tom Sanderson

    Seasonally adjusted real retail sales increased slightly in August to $166.7 billion from $166.5 billion in July. (Note that actual sales are deflated using CPI 1982-84=100.) Year-over-year growth is declining to anemic low single digits (2.41%) as they are compared to better results later in 2009. From peak to current, retail sales are off 7.6%, a much smaller percentage decline than what has occurred in the housing and auto markets. August sales were 5.4% higher than the trough of the recent recession. From March 2010 through August 2010 retail sales numbers are flat, stalling out what had been looking like a recovery. The vertical bars in the graph represent recessions.

  • Housing Starts, Sales, and Inventory

    Multi-unit housing starts rise sharply in August

    - by Tom Sanderson

    August housing starts totaled 598 thousand (seasonally adjusted annual rate), up sharply from 541 thousand in July. Housing starts remain far below the average of just over 1.5 million per year over the last 40+ years, and even farther below the 2.2 million peak of the most recent housing boom. Most of the growth in housing was in multi-unit structures. Single-unit structures increased by 18,000 while multi-unit structures increased by 39,000. Before anyone gets too excited, it is important to remember that starts were over 600 thousand earlier this year. Since 1968, the U.S. population has grown from 200 million to over 300 million. Low housing starts not only impact transportation demand for building products but also for appliances, furniture, and other related items. The vertical bars represent recessions.

     

  • Housing Starts, Sales, and Inventory

    New home inventories continue slow decline, but sales remain weak

    - by Tom Sanderson

    New home inventory dropped slightly to 8.6 months of supply in August from a revised 8.7 months in July. The absolute inventory of new homes continues to fall and is now at 206 thousand, the lowest level seen since the late 1960’s. Any recovery in the rate of sales would quickly deplete the low absolute inventory level and lead to a significant increase in housing starts (and freight) but that does not appear likely in the near term. The vertical bars in the graphs represent recessions.

  • Diesel Fuel Prices

    Diesel prices remain stable

    - by Tom Sanderson

    Weekly retail on-highway U.S. diesel prices eased slightly to $2.951 per gallon from $2.960 in the prior week. Prices have been in a fairly tight range since early March with a low of $2.899 and a high of $3.131, which is better illustrated in our second graph. Diesel prices peaked at $4.764 per gallon in July of 2008 and were above $3 per gallon from September 24, 2007 to November 3, 2008. Prices in 2010 continue to fall between pricing levels of the prior two years, but with much lower volatility.

     

  • Morgan Stanley Graphs

    Morgan Stanley flatbed index shows capacity starting to tighten again

    - by Tom Sanderson

    Morgan Stanley’s flatbed freight index is rising again but is far off the pace of Q2 2010 indicating more readily available capacity at this time compared to Q2 but still a somewhat more  tight capacity environment than at this time in the previous few years. The flatbed market was particularly hard hit by the fall off in housing starts, but has gained some ground with the growth in U. S. manufacturing. The index measures incremental demand for flatbed truckload services compared to incremental supply. The higher the index the tighter is capacity relative to demand when compared to a prior period.

    Morgan Stanley Flatbed 09-19-10.jpeg
    Graph reproduced with permission from Morgan Stanley. For more information contact: Adam Longson at Adam.Longson@morganstanley.com or Bill Green at William.Greene@morganstanley.com

  • Morgan Stanley Graphs

    Morgan Stanley refrigerated index shows very tight capacity

    - by Tom Sanderson

    Morgan Stanley’s refrigerated truckload freight index has fallen off somewhat from the pace of Q2 2010 indicating more readily available capacity at this time compared to Q2. Refrigerated capacity continues to be very tight relative to 2009 and to most other recent years. The exception is the hurricane-induced capacity shortages at the end of 2005. The last two months have shown increasing tightness of refrigerated capacity. The index measures incremental demand for refrigerated truckload services compared to incremental supply. The higher the index the tighter is capacity relative to demand when compared to a prior period.

    Morgan Stanley Refrig 09-19-10.jpeg

    Graph reproduced with permission from Morgan Stanley. For more information contact: Adam Longson at Adam.Longson@morganstanley.com​ or Bill Green at William.Greene@morganstanley.com

  • Morgan Stanley Graphs

    Morgan Stanley TL Dry Van Index remains level

    - by Tom Sanderson

    Morgan Stanley’s dry van truckload freight index has fallen off somewhat from the pace of Q2 2010 indicating more readily available capacity at this time compared to Q2 but certainly a much tighter capacity environment than 2009. The index measures incremental demand for dry-van truckload services compared to incremental supply. The higher the index the tighter is capacity relative to demand when compared to a prior period. In Q2 it was starting to look like we may see a repeat of the TL capacity shortages of 2004 and 2005, but at this point the graph is tracking very closely to 2006 and 2008 which were strong through Q2 and then plunged toward the end of the year.

     

    Morgan Stanley TL 09-19-10.jpeg

    Graph reproduced with permission from Morgan Stanley. For more information contact: Adam Longson at Adam.Longson@morganstanley.com​ or Bill Green at William.Greene@morganstanley.com

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  • Morgan Stanley Graphs

    Morgan Stanley refrigerated index shows very tight capacity

    - by Tom Sanderson

    Morgan Stanley’s refrigerated truckload freight index has fallen off somewhat from the pace of Q2 2010 indicating more readily available capacity at this time compared to Q2. Refrigerated capacity continues to be very tight relative to 2009 and to most other recent years. The exception is the hurricane-induced capacity shortages at the end of 2005. The last two months have shown increasing tightness of refrigerated capacity. The pricing environment in this segment clearly favors the carriers at this point. The index measures incremental demand for refrigerated truckload services compared to incremental supply. The higher the index the tighter is capacity relative to demand when compared to a prior period.

    Graph reproduced with permission from Morgan Stanley. For more information contact: Adam Longson at Adam.Longson@morganstanley.com or Bill Green at William.Greene@morganstanley.com

  • Morgan Stanley Graphs

    Morgan Stanley dry van truckload index continues so show no tightening of capacity

    - by Tom Sanderson

    Morgan Stanley’s dry van truckload freight index continues at moderate levels, compared to the tighter capacity environment in Q2 2010. While capacity remains tighter than in 2009, the spread between 2009 and 2010 is narrowing and the current index is below the 1995-2008 average. The index measures incremental demand for dry-van truckload services compared to incremental supply. The higher the index the tighter is capacity relative to demand when compared to a prior period. In Q2 it was starting to look like we may see a repeat of the TL capacity shortages of 2004 and 2005, but at this point the graph is tracking very closely to 2006 and 2008 which were strong through Q2 and then plunged toward the end of the year.

    Graph reproduced with permission from Morgan Stanley. For more information contact: Adam Longson at Adam.Longson@morganstanley.com or Bill Green at William.Greene@morganstanley.com

  • Retail & Same Store Sales

    Same store sales data illustrates weakness in retail sector

    - by Tom Sanderson

    Same store sales data shows ongoing weakness as only one for the top 10 retailers posted growth of more than 3%; Costco at 5.0%. Three of the top 10 showed declining same store sales in their most recent reporting period including giant Wal-Mart. The data is consistent with overall retail sales numbers, but it brings home the message to see how even the best retailers are struggling to achieve adequate sales growth. The outlook has improved from 2009 when same store sales for the same reporting period showed much worse results than 2008. Only 4 of these retailers posted same store sales growth for this reporting period in 2009 over 2008. The retail segment drives a tremendous amount of freight transportation and this data shows that demand for freight transportation is likely to remain weak in the near term.

     

    Source: www.retailerdaily.com , www.stores.org , Transplace analysis, excludes fuel sales.

  • Retail & Same Store Sales

    Retail sales remain flat and year-over-year comps deteriorate

    - by Tom Sanderson

    Seasonally adjusted real retail sales increased slightly in August to $166.7 billion from $166.5 billion in July. (Note that actual sales are deflated using CPI 1982-84=100.) Year-over-year growth is declining to anemic low single digits (2.41%) as they are compared to better results later in 2009. From peak to current, retail sales are off 7.6%, a much smaller percentage decline than what has occurred in the housing and auto markets. August sales were 5.4% higher than the trough of the recent recession. From March 2010 through August 2010 retail sales numbers are flat, stalling out what had been looking like a recovery. The vertical bars in the graph represent recessions.

  • Housing Starts, Sales, and Inventory

    Multi-unit housing starts rise sharply in August

    - by Tom Sanderson

    August housing starts totaled 598 thousand (seasonally adjusted annual rate), up sharply from 541 thousand in July. Housing starts remain far below the average of just over 1.5 million per year over the last 40+ years, and even farther below the 2.2 million peak of the most recent housing boom. Most of the growth in housing was in multi-unit structures. Single-unit structures increased by 18,000 while multi-unit structures increased by 39,000. Before anyone gets too excited, it is important to remember that starts were over 600 thousand earlier this year. Since 1968, the U.S. population has grown from 200 million to over 300 million. Low housing starts not only impact transportation demand for building products but also for appliances, furniture, and other related items. The vertical bars represent recessions.

     

  • Housing Starts, Sales, and Inventory

    New home inventories continue slow decline, but sales remain weak

    - by Tom Sanderson

    New home inventory dropped slightly to 8.6 months of supply in August from a revised 8.7 months in July. The absolute inventory of new homes continues to fall and is now at 206 thousand, the lowest level seen since the late 1960’s. Any recovery in the rate of sales would quickly deplete the low absolute inventory level and lead to a significant increase in housing starts (and freight) but that does not appear likely in the near term. The vertical bars in the graphs represent recessions.

  • Diesel Fuel Prices

    Diesel prices remain stable

    - by Tom Sanderson

    Weekly retail on-highway U.S. diesel prices eased slightly to $2.951 per gallon from $2.960 in the prior week. Prices have been in a fairly tight range since early March with a low of $2.899 and a high of $3.131, which is better illustrated in our second graph. Diesel prices peaked at $4.764 per gallon in July of 2008 and were above $3 per gallon from September 24, 2007 to November 3, 2008. Prices in 2010 continue to fall between pricing levels of the prior two years, but with much lower volatility.

     

  • Morgan Stanley Graphs

    Morgan Stanley flatbed index shows capacity starting to tighten again

    - by Tom Sanderson

    Morgan Stanley’s flatbed freight index is rising again but is far off the pace of Q2 2010 indicating more readily available capacity at this time compared to Q2 but still a somewhat more  tight capacity environment than at this time in the previous few years. The flatbed market was particularly hard hit by the fall off in housing starts, but has gained some ground with the growth in U. S. manufacturing. The index measures incremental demand for flatbed truckload services compared to incremental supply. The higher the index the tighter is capacity relative to demand when compared to a prior period.

    Morgan Stanley Flatbed 09-19-10.jpeg
    Graph reproduced with permission from Morgan Stanley. For more information contact: Adam Longson at Adam.Longson@morganstanley.com or Bill Green at William.Greene@morganstanley.com

  • Morgan Stanley Graphs

    Morgan Stanley refrigerated index shows very tight capacity

    - by Tom Sanderson

    Morgan Stanley’s refrigerated truckload freight index has fallen off somewhat from the pace of Q2 2010 indicating more readily available capacity at this time compared to Q2. Refrigerated capacity continues to be very tight relative to 2009 and to most other recent years. The exception is the hurricane-induced capacity shortages at the end of 2005. The last two months have shown increasing tightness of refrigerated capacity. The index measures incremental demand for refrigerated truckload services compared to incremental supply. The higher the index the tighter is capacity relative to demand when compared to a prior period.

    Morgan Stanley Refrig 09-19-10.jpeg

    Graph reproduced with permission from Morgan Stanley. For more information contact: Adam Longson at Adam.Longson@morganstanley.com​ or Bill Green at William.Greene@morganstanley.com

  • Morgan Stanley Graphs

    Morgan Stanley TL Dry Van Index remains level

    - by Tom Sanderson

    Morgan Stanley’s dry van truckload freight index has fallen off somewhat from the pace of Q2 2010 indicating more readily available capacity at this time compared to Q2 but certainly a much tighter capacity environment than 2009. The index measures incremental demand for dry-van truckload services compared to incremental supply. The higher the index the tighter is capacity relative to demand when compared to a prior period. In Q2 it was starting to look like we may see a repeat of the TL capacity shortages of 2004 and 2005, but at this point the graph is tracking very closely to 2006 and 2008 which were strong through Q2 and then plunged toward the end of the year.

     

    Morgan Stanley TL 09-19-10.jpeg

    Graph reproduced with permission from Morgan Stanley. For more information contact: Adam Longson at Adam.Longson@morganstanley.com​ or Bill Green at William.Greene@morganstanley.com

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