The coronavirus has wreaked havoc on the Canadian economy but flatbed trucking remains optimistic that freight demand is returning. It is expected that freight volumes will increase over the coming days as states begin to reopen. Factories have to replenish their materials and businesses need new equipment.
Canada’s Prime Minister Justin Trudeau has acknowledged that the country is suffering from the largest economic impact and contraction since the Great Depression. Lockdowns were the appropriate response to prevent the virus from spreading but it came at a staggering cost to the government. It came at an enormous price of about $230 billion. The cost is expected to continue to rise through to the coming year.
As the government works to ensure that the economy is back to pre-pandemic footing, freight markets are less impacted because they are mostly associated to food, shelter, clothing and transport. Kenny Vieth, ACT research president and senior analyst predicts a strengthening of spot market prices, improvement of freight volumes and tightness in capacity to improve commercial vehicle demand.
According to Market Trends report that was released in mid-July, used truck prices in Canada have started to stabilize. OEM incentives have helped a lot in moving inventory and strengthening order books. While it is too early to be confident, there are positive signs of increased demand.
A survey of current business landscape revealed that May and June have showed signs of recovery but uncertainty remains. The economy and motor freight have showed strength since the beginning of May until mid-June because of the relaxed restrictions on workplaces and shelter-in-place. Return to normal is associated to the revival in business and social activities.
Spot market rates and volumes have increased in June because of seasonal trends however, consumer spending habits continue to be affected by the pandemic. While there is an increase in demand for pressure-treated lumber for home improvement projects, growers and distributors are contending with soft demands because states are reopening at different speeds.
As states begin to reopen, there is will be greater demand for flatbed trucking to transport raw materials like steel or concrete. Heavy loads can be quickly and efficiently transported regardless of how specialized the transport needs are.