This was the second consecutive month of decline for the TSI, which measures changes in the output of the country's for-hire freight transportation services based on data from trucking, rail, inland waterways, pipelines and air freight. The index registered 108.0 in September, equivalent to the four-year low set 12 months earlier and down 4.5% from the historic peak of 113.1 reached in November 2005.
The September decline followed a 1.9% drop in August. According to BTS, the September and August figures were, respectively, the fifth and eighth largest monthly declines in 10 years. The combined 4.3% descent pushed the index into negative territory for the year.
The October ATA decline marked the fourth consecutive monthly drop for that index. The figure fell 0.8% in September and 1.9% in August. Though October is typically one of the trucking industry's busiest months as retailers stock up for the holiday, this year the month was a "fizzle," according to ATA economist Robert Costello.
"The latest truck tonnage drop suggest that retailers are very pessimistic for the holiday sales season," he says, adding that the cumulative drop in truck tonnage over the last four months suggests the US economy is likely to contract by at least 3% in Q4.
According to IIR, the total number of industrial construction launches is well below levels predicted earlier in the year, with from 20 to 30 previously scheduled projects falling out of the active category each day. As of Nov. 24, the company was tracking 15,700 active projects, 2,400 postponed projects and 8,800 canceled projects.
IIR research reveals that 169 industrial projects valued at $14 billion began construction in North America since the financial and economic crisis escalated in September. About 40% of the value was tied up in projects involving the power, metals and mining industries rather than the manufacturing or warehousing and distribution facilities that constitute the bulk of the investment real estate market.
Of the top categories for new construction, only the food and beverage industry, which accounted for 40 projects worth $1.6 billion, has much direct interface with investment real estate. The top categories were the power industry with 17 projects totaling $3.2 billion and the metals and minerals industry with 22 projects totaling $2.7 billion.
While construction of new investment projects is limited, IIR points out that continued construction of non-investment properties helps investors indirectly by providing work for the equipment and service suppliers who make up a sizable chunk of the industrial property tenant base.
In addition to the above, the Commerce Department reports orders to US factories for big-ticket manufactured goods plunged in October, dropping 6.2%, the largest drop in two years. The decline was more than double what economists had predicted.
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