Cyclists often display bumper stickers or yard signs reminding motorists to “share the road.” The U.S. Department of Transportation even has a website providing information about safe road sharing.
Although these reminders are typically lighthearted, the message is serious: as road congestion increases, vehicles of all types are more likely to be involved in collisions. This unsurprising relationship between road congestion and vehicle collisions has been documented repeatedly for quite some time, and applies as aptly to large commercial trucks as to smaller vehicles.
For this reason, drivers of all vehicle classes should take note of the recent travel monitoring reports from the U.S. DOT, which show that monthly miles traveled increased year-over-year during nearly every month in 2012. During the recent recession, motorists broke a long-running trend of annual increases in vehicle miles traveled, and the trend then remained flat to decreasing for much of the past five years (Figure 1).
As the economy slowly improves – and provided gasoline prices remain fairly stable – annual vehicle miles traveled are likely to continue increasing, perhaps returning to the long-term trend. Over the next few years, the phrase “share the road” may ring truer than ever.
Archives
SOMETIMES YOU’VE GOTTA BREAK IT IN ORDER TO FIX IT
When we send out a product we want it to be as ‘bug free’ as possible. To that end, we employ an avid testing process, wherein testing starts at the beginning of development and continues even after the product has been deployed.
Our tech team begins the testing process by gaining a good understanding of what the product is and how it should function. After getting a thorough handle on the product, we write a test that, when run, will make sure the product is functioning correctly. We run this test after the product is finished being coded, going back and fixing coding problems until the test is passed. These tests are retained for the life of the product, and are constantly running to make sure that no future additions or alterations damage the product.
After the product passes this initial test, the developers test it further, and then upload it to a test environment (test environments are often clones of live website, wherein testers can demo functionality of new products without affecting the live website). Our quality assurance testers (QAs) manually try the functionality of the new product in the test environment, making sure it does what it is designed to do, and nothing that it isn’t. Strangely enough, the most valuable QAs are those who are agile enough to find ways to ‘break’ the product. The more ways in which testers can try to ‘break’ a product, the more durable and ‘bug free’ the product can become. All of the bugs and missing functionality found by the QAs are sent back to the developers for repair. After a bug is fixed, it must again go through testing.
Before the QAs get into the detailed stages of testing, they explore the product to make sure all obvious bugs and functionality has been dealt with. Then they send out the product to testers throughout the company, as each Internet Truckstop department has a few people designated to help test, with testers rotating quarterly. Each company tester spends an hour a day doing nothing but testing products for functionality and bugs. The more eyes exploring a product, the better, as the diversity of approaches and perspectives makes for a more thoroughly tested product. When company testers find the product to be ‘bug free’ and user friendly, they communicate to QAs that the product has ‘passed.’
QAs continue to test even while they wait for the product to pass through the company testers. After confirming that all bugs have been fixed, that functionality is working and user friendly, and that company testers have given the ‘thumbs up,’ the product is finished, and ready for rollout.
After passing through our developers, our QAs, and our company testers, the product then moves on to its most important test of all – your daily use! Our entire testing process is designed to make our products function in the useful, user friendly ways that you would like it to. We greatly value your feedback because your opinion is the most important of all.
About the Author
Chelsea Baguley, is a certified Scrum Master at Internet Truckstop and works hand in hand with the development department. Chelsea started as a tester at Internet Truckstop and has a keen insight of the functions on the load board.
Some (Cautiously) Optimistic News for the Economy
Last week, two key economic reports showed an improving environment for trucking. In one, the U.S. Census Bureau reported that total monthly retail sales increased by a seasonally-adjusted 0.3% during November, or 3.7% year over year. In the other, the Federal Reserve documented a full percentile increase in the monthly industrial production index for November, including a 1.1 percentile improvement in the manufacturing component.
Contrasted with the weakness seen in these measures during recent months, the November reports are especially promising for trucking. The improvement in industrial production, for instance, was the largest monthly increase in this index since December 2010. Retail sales, meanwhile, are now up nearly 25% from their recessionary bottom.
The scene is not all rosy, however. As the Fed’s report noted, “The gain in November is estimated to have largely resulted from a recovery in production for industries that had been negatively affected by Hurricane Sandy, which hit the Northeast region in late October.”
Moreover, inventories continue to grow throughout the supply chain. As shown in the figure, the growth rate of inventory accumulation has outpaced that for retail sales and production since late 2010, and the volume of business inventories steadily increases. So long as the supply chain struggles to move existing stock, we will continue to see a disconnect between new production and demand for more trucking.
Whether the November improvements in manufacturing and sales will continue is an open question. Some early answers to this question will be provided this week in the December regional production reports from the Fed Banks in New York, Philadelphia, and Kansas City.
Jeremy West
ITS Economist
Surprise, Surprise… the Manufacturing Sector Remains Choppy
By Jeremy West, Internet Truckstop Economist
Over the past few months, it has seemed like U.S. manufacturers are treading water. Factory output isn’t dramatically sinking, as occurs whenever the economy is entering a recession. But, on the other hand, we’re not seeing any production gains worth cheering about either.
Two basic metrics are tracked for manufacturing output: the quantity of current production and the volume of orders for future production. Last Thursday, the Census Bureau reported that new orders in August for factory production fell 5.2% month-over-month and 2.5% year-over-year. This was the first year-over-year decline in new orders since November 2009.
Much of this decline resulted from a 101.8% drop in orders for commercial aircraft. As shown in the figure, orders excluding transportation equipment increased by 0.28% YOY. Regardless, the message is clear: manufacturing production is stalling.
Separately, the Institute for Supply Management reported that the Purchasing Managers’ Index (PMI) increased to 51.5 during September. This was positive news: any value above 50 indicates manufacturing growth, and the index has been below 50 since May. The next few months will show whether this represents a temporary spike in manufacturing activity or a reversal of the contraction seen in the manufacturing sector during 2012Q2.
So, the production picture isn’t entirely gloomy, and some regions of the country are performing better than others. During September, manufacturing output improved in Texas and in the Central Atlantic regions, worsened in New York and in much of the Midwest, and remained largely flat in the Philadelphia region.
Taken together, these reports offer a mixed outlook for total manufacturing—and, subsequently, trucking—with aggregate production activity trending to the downside. The next Federal Reserve Industrial Production and Manufacturing report is scheduled for October 16th. Don’t be surprised to find that factories continued to slowly churn.
Market Demand Index (MDI) Decreases 2%
FOR IMMEDIATE RELEASE
NEW PLYMOUTH, ID (September 25, 2012) - Internet Truckstop, the largest web-based freight matching service in the transportation industry reports that the Market Demand Index (MDI) decreased 2% to 11.64 from 11.83 the previous week as reported in the weekly Trans4Cast.
The overall average equipment rate decreased 2% to $2.04 from $2.09 the previous week. Flatbed rates decreased 3% to $1.90 from $1.96 the previous week. Reefer rates decreased 3% to $2.08 from $2.16 the previous week. Specialized truck rates increased 2% to $2.45 from $2.41 the previous week. Van rates decreased 5% to $1.72 from $1.82 the previous week.
“With an upcoming national election, a looming “fiscal cliff,” and continuing instability in the Eurozone, the economic climate is quite unclear. And, the outlook will remain murky until businesses and consumers can better determine the political environment in which they must operate.” Jeremy West, Internet Truckstop Economist
About Trans4Cast powered by Internet Truckstop
Trans4Cast is the compilation of highly relevant data, easily accessible to all trucking professionals. The Market Demand Index (MDI), a measure of relative truck demand, is culled from Internet Truckstop data. Internet Truckstop compiles this weekly report that will assist in making critical business decisions. The report is now a web series with a news anchor and appears as the Industry Economic Update on BigTruckTV.com, Internet Truckstop, and Truckload Carriers Association. The show is produced bi-weekly and can be accessed online 24/7. Jeremy West is the economic consultant preparing this report. He holds a bachelor of science in Economics, with minor degrees in Business and Creative Studies, from Texas A&M University, where he is currently completing a doctorate in Economics. For more information on Trans4Cast, please contact Roxanne Bullard at 1-800-203-2540 ext. 6230.
How Much is Policy Uncertainty Hindering the Economy?
By Jeremy West, Internet Truckstop Economist
Consider the following situation:
You operate a small carrier and are considering adding a few trucks to your fleet. There is a (hypothetical) politician who is campaigning for a U.S. Senate seat on a platform of further expanding the FMCSA regulations to require any commercial truck that crosses state lines to have two drivers in the cab with combined driving experience of at least twenty years. (You may think this hypothetical rule sounds ridiculous, but some opinions of the current CSA regulations indicate that such a proposal would not be that big of a leap). Suppose that this politician has a sizeable chance of winning his campaign. Are you going to buy any new trucks today, or wait (at least) until after the November election?
The above situation illustrates the role of “policy uncertainty” in shaping economic decisions. In this case, whether or not you invest in expanding your fleet will be partly determined by the outcome of the upcoming election. As a result of this uncertainty, you forgo making the decision until after the election outcome is known.
It isn’t just elections that create policy uncertainty. As was mentioned in a post to the Industry Economic Update LinkedIn group, this practice of delaying investment decisions is currently widespread in the economy. In a recent article on political uncertainty, the Washington Times notes, “[if] there’s one thing investors and employers hate, it’s not knowing what lies ahead.”
Two groups of academic researchers have attempted to quantify the effect of policy uncertainty on the economy. In their article, “Measuring Economic Policy Uncertainty” (pdf), Scott R. Baker, Nicholas Bloom, and Steven J. Davis link several measures of political uncertainty (such as the frequency of media references to policy uncertainty) to declines in real GDP, private investment, and aggregate employment. Separately, Sylvain Leduc and Zheng Liu find that uncertainty about future economic conditions is substantially responsible for the sluggish economic recovery that has followed the recession.
With an upcoming national election, a looming “fiscal cliff,” and continuing instability in the Eurozone, the economic climate is quite unclear. The outlook will remain murky until businesses and consumers can better determine the political environment in which they must operate.
Press Release – Tran4Cast Powered by Internet Truckstop Market Demand Index (MDI) Decreases 10%
Tran4Cast Powered by Internet Truckstop Market Demand Index (MDI) Decreases 10%
NEW PLYMOUTH, Idaho, September 18, 2012– Internet Truckstop, the largest web-based freight matching service in the transportation industry reports that the Market Demand Index (MDI) decreased 10% to 11.83 from 13.2 the previous week as reported in the weekly Trans4Cast.
The overall average equipment rate decreased 3% to $2.09 from $2.16 the previous week. Flatbed rates decreased 1% to $1.96 from $1.98 the previous week. Reefer rates decreased 6% to $2.16 from $2.30 the previous week. Specialized truck rates decreased 3% to $2.41 from $2.49 the previous week. Van rates decreased 2% to $1.82 from $1.86 the previous week.
“The economic climate remains tumultuous for trucking. On Friday, the Census Bureau reported that August retail sales increased nearly 1% from July, while the Federal Reserve reported that manufacturing activity shed 0.7% over the same period. Trucking activity should be seasonally strong through November, but broader instability continues to temper volumes and rates.”
Jeremy West, Internet Truckstop Economist
About Internet Truckstop
Founded in 1995, Internet Truckstop is the first and largest freight matching service on the web. Internet Truckstop offers more tools than any other freight matching service available. These easy-to-use tools, the largest freight database, and a commitment to the transportation industry make Internet Truckstop the leader in Internet freight matching.
About Trans4Cast powered by Internet Truckstop
Trans4Cast is the compilation of highly relevant data, easily accessible to all trucking professionals. The Market Demand Index (MDI), a measure of relative truck demand, is culled from Internet Truckstop data. Internet Truckstop compiles this weekly report that will assist in making critical business decisions. The report is now a web series with a news anchor and appears as the Industry Economic Update on BigTruckTV.com, Internet Truckstop, and Truckload Carriers Association. The show is produced bi-weekly and can be accessed online 24/7. Jeremy West is the economic consultant preparing this report. He holds a bachelor of science in Economics, with minor degrees in Business and Creative Studies, from Texas A&M University, where he is currently completing a doctorate in Economics. For more information on Trans4Cast, please contact Roxanne Bullard at 1-800-203-2540 ext. 6230.
Press Release – Trand4Cast Powered by Internet Truckstop Market Demand Index (MDI) Increases 2%
New Plymouth, Idaho, September 11, 2012–Internet Truckstop, the largest web-based freight matching service in the transportation industry reports that the Market Demand Index (MDI) increased 2% to 13.2 from 12.96 the previous week as reported in the weekly Trans4Cast.
The overall average equipment rate decreased 1% to $2.16 from $2.17 the previous week. Flatbed rates decreased 2% to $1.98 from $2.01 the previous week. Reefer rates increased 4% to $2.30 from $2.21 the previous week. Specialized truck rates decreased 2% to $2.49 from $2.54 the previous week. Van rates decreased 3% to $1.86 from $1.92 the previous week.
One of the more disappointing economic reports last week was that the Institute for Supply Management’s proprietary PMI for manufacturing remained below 50 in August for the third consecutive month. The PMI is a composite measure of several dimensions of the supply chain, and any value below 50 reflects a contraction in U.S. manufacturing activity.
About Trans4Cast powered by Internet Truckstop
Trans4Cast is the compilation of highly relevant data, easily accessible to all trucking professionals. The Market Demand Index (MDI), a measure of relative truck demand, is culled from Internet Truckstop data. Internet Truckstop compiles this weekly report that will assist in making critical business decisions. The report is now a web series with a news anchor and appears as the Industry Economic Update on BigTruckTV.com, Internet Truckstop, and Truckload Carriers Association. The show is produced bi-weekly and can be accessed online 24/7. Jeremy West is the economic consultant preparing this report. He holds a bachelor of science in Economics, with minor degrees in Business and Creative Studies, from Texas A&M University, where he is currently completing a doctorate in Economics. For more information on Trans4Cast, please contact Roxanne Bullard at 1-800-203-2540 ext. 6230.
About Internet Truckstop
Founded in 1995, Internet Truckstop is the first and largest freight matching service on the web. Internet Truckstop offers more tools than any other freight matching service available. These easy-to-use tools, the largest freight database, and a commitment to the transportation industry make Internet Truckstop the leader in Internet freight matching.
Source:
Stephanie Sternes
800-203-2540 ext. 6186
stephanies@truckstop.com
Is manufacturing activity weakening? Comparing the Industrial Production Index to the PMI
One of the more disappointing economic reports last week was that the Institute for Supply Management’s proprietary PMI for manufacturing remained below 50 in August for the third consecutive month. The PMI is a composite measure of several dimensions of the supply chain, and any value below 50 reflects a contraction in U.S. manufacturing activity.
In contrast, the Manufacturing component of the Federal Reserve’s Industrial Production (IP) Index increased moderately during both June and July (the August values will be released this week on September 14th). The divergence of these two indices presents a conundrum: how can manufacturing be simultaneously increasing and decreasing?
The discrepancy primarily results from differences in the method by which each of these indices is constructed. The Federal Reserve determines monthly IP Manufacturing strictly by examining (actual and imputed) industrial output, sourced from various trade associations and censuses.
By comparison, the PMI is formed from surveys of ISM member businesses and reflects five components: new orders, production, employment, supplier deliveries, and inventories. Because it includes several components besides production, the PMI may contract even if current manufacturing volumes are increasing.
So, which of these two indices is superior? Or, more specifically, which index better contextualizes the environment for trucking? Although some analysts argue the PMI has inferior predictive power (e.g. Bachman, 2010), this relates more to its usefulness for forecasting economic recessions than its quality in measuring the current business climate.
Overall, both measures are valuable for carriers to use in evaluating their future outlook. The Industrial Production Index is informative about future volumes, especially over a longer term—goods that are produced are eventually going to be shipped, generating demand for trucks. The PMI speaks to the current manufacturing climate, and declines in the non-output portions of the PMI could foreshadow production declines to come.
Jeremy West, Internet Truckstop Economist
Press Release: Trans4Cast Powered by Internet Truckstop Market Demand Index (MDI) Increases 7%
New Plymouth, Idaho September 5, 2012–Internet Truckstop, the largest web-based freight matching service in the transportation industry reports that the Market Demand Index (MDI) increased 7% to 12.96 from 12.14 the previous week as reported in the weekly Trans4Cast.
The overall average equipment rate increased 4% to $2.17 from $2.10 the previous week. Flatbed rates remained unchanged at $2.01 from the previous week. Reefer rates increased 3% to $2.21 from $2.14 the previous week. Specialized truck rates increased 4% to $2.54 from $2.45 the previous week. Van rates increased 7% to $1.92 from $1.79 the previous week.
“The flat-line trend for trucking metrics broke this week, with volumes and rates moving significantly to the upside. This improvement in loads is partly seasonal, but is also attributable to a mildly improving economic climate. However, the overall economic outlook for trucking remains relatively weak, supporting expectations of moderate but unimpressive growth for the sector across the second half of 2012.” Jeremy West, Internet Truckstop Economist
About Trans4Cast powered by Internet Truckstop
Trans4Cast is the compilation of highly relevant data, easily accessible to all trucking professionals. The Market Demand Index (MDI), a measure of relative truck demand, is culled from Internet Truckstop data. Internet Truckstop compiles this weekly report that will assist in making critical business decisions. The report is now a web series with a news anchor and appears as the Industry Economic Update on BigTruckTV.com, Internet Truckstop, and Truckload Carriers Association. The show is produced bi-weekly and can be accessed online 24/7. Jeremy West is the economic consultant preparing this report. He holds a bachelor of science in Economics, with minor degrees in Business and Creative Studies, from Texas A&M University, where he is currently completing a doctorate in Economics. For more information on Trans4Cast, please contact Roxanne Bullard at 1-800-203-2540 ext. 6230.
About Internet Truckstop
Founded in 1995, Internet Truckstop is the first and largest freight matching service on the web. Internet Truckstop offers more tools than any other freight matching service available. These easy-to-use tools, the largest freight database, and a commitment to the transportation industry make Internet Truckstop the leader in Internet freight matching.
Source:
Stephanie Sternes
800-203-2540 ext. 6186
stephanies@truckstop.com
