Infrastructure spending is expected to be a priority for Congress and President Trump in 2019 with global trade hinging on whether the new United States, Canada and Mexico Agreement is ratified as well as the outcome of negotiations with China and the European Union on future trade deals (Transport Topics – 1/4/19).
Transport Topics also predicted the following for 2019:
- Demand for freight hauling will grow at a slower pace.
- The U.S. gross domestic project will increase 2.5% — still one of the better years in the current economic expansion cycle that is already one of the longest in history.
- Freight activity will be weaker than normal in the first quarter because of shipping patterns caused by the threat of tariffs on Chinese goods.
- Construction is poised for another year of growth, following the “moderate and unusually well-balanced growth in 2018.”
- Neither labor supply tightness nor tariffs are likely to accelerate inflation at the consumer level (despite the trade war), as many firms will try to absorb cost increases through productivity improvements.
- U.S. production of cars and light trucks will likely stay in the range of 17 million units, with production continuing to shift from cars to light trucks.
- Consumer confidence will remain high and the cost of capital will remain close to zero.
- Supply chain processes will continue to be automated and a hydrogen-electric Class 8 truck will have its commercial debut.
- Deal-making will increase to its highest level in 14+ years.
- Driver hours-of-service rules and entry level driver training will potentially change.
- The minimum age of commercial truck drivers will be lowered to 21 in interstate commerce.
- Investment in trucks will increase 5% to 11% — a decrease from 14.3% over 2018.
- The shortage of drivers will remain the biggest challenge for most trucking companies.