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John’s Blog
7-26-10
Dear Friends,
Last week in the news the Commerce
Department reported that housing starts fell 5% in June. Building
permits rose 2.1% showing some optimism. New-home sales jumped 23.6%
in June from the previous month which is good news if sustainable.
The Conference Board reported the
Leading Economic Indicator index decreased by 0.2% in June after a
0.5% gain in May.
The Labor Department says initial
jobless claims were down 21,000 last week. These numbers are moving
up and down and the net result is unclear. The take-away is that
jobs are slowly improving but not with any dramatic increases.
The Wall Street Journal reported last
week that China had overtaken the United States as the largest user
of energy consuming 2.25 billion tons of oil equivalents in 2009.
TransCore’s North American Freight
Index was up 112% in June showing that the spot market for truck
capacity exploded last month when compared to June 2009. Coming off
of the deep recession numbers of 2009 these kinds of over the top
increases are expected.
Reefer and dry van traffic was up 2%
from May to June with overall load volume dipping 11% in the same
period as flat bed traffic cooled off. Carriers are going after rate
increases but it is still uncertain that these levels of freight are
sustainable. We shall see what happens.
The AAR said last week that intermodal
rail traffic increased 20.1% year over year in the week ending July
17th. This volume while significant, is 2.5% lower than
the same week from 2008 so perhaps we are just getting back to normal
in intermodal.
Other rail traffic was up in the same
period 5.5%
Motor carriers mostly continue to
report positive earnings and good equipment utilization. Swift is
going to go public again and has filed the documents needed to launch
an IPO.
Orders for heavy duty Class 8 trucks
jumped 93% in June year over year according to ACT Research. Class 8
trucks had net orders of 15,999 showing that fleet replacement is
happening.
At Wagner, we are in the dog days of
summer and working with existing business to enhance productivity and
review processes. Should you have a project in the future for
warehouse distribution, e-commerce fulfillment, transportation or
product customization, I would be happy to discuss the possibilities
with you about a new operation that is tailored to your requirements.
Have a great week!
John Wagner Jr
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