Freight-Generating Sectors Starting to Mend

Key freight-generating sectors of the economy starting to mend, freight cycle troughs tend to last around two years

According to ACT’s latest release of the North American Commercial Vehicle OUTLOOK, at 128 months, the current US economic expansion is the longest on record, surpassing the previous cycle record (1992-2001) by eight months and counting. And with solid consumer fundamentals, no obvious imbalances, and already having weathered the manufacturing downturn to date, it is harder to see a recession now than it was six months ago.

 “Starting with the caveat “exogenous events,” our outlook calls for an uninterrupted economic expansion through the five-year forecast horizon,” said Kenny Vieth, ACT’s President and Senior Analyst. He elaborated, “While the economic cycle is presently at a low ebb, signs of any step-downs from here are moderating. While there are datapoints that remain negative, industrial production was still contracting as recently as December; others are suggesting the bottom is passing.” Vieth added, “With key freight-generating sectors of the economy starting to mend, we are reminded that freight cycle troughs tend to last around two years. With the current cycle dating from Q4’18, we have entered the sixth quarter of what is typically an eight-quarter process. We would note that only once in the 2000s has a freight-cycle trough persisted beyond two years, 2007-2009.”

Category: Featured, General Update, News