Editorial: Celebrating 2005 and Looking Ahead

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or many in the trucking industry, 2005 turned out to be a much better year than most of us imagined 12 months ago.

Thanks to a strong domestic economy, coupled with the reduction in freight capacity brought on by the last recession, most of the nation’s fleets racked up handsome profits during the year.

Even the sky-high level of fuel prices for much of 2005 — with diesel reaching costs that were only the stuff of nightmares in years past — wasn’t enough to derail the industry’s profitability.

But high fuel prices did eat up a large portion of the additional revenue fleets collected, as freight rates rose in response to the heavy demand and tight capacity.

Fuel was surely the top story of 2005, and nearly every issue of Transport Topics featured a front-page account of the latest price and supply changes.

Weather was also a big story throughout the year, especially the late summer hurricanes that inflicted serious damage along the nation’s Gulf Coast and in portions of Florida along the Atlantic Coast.

The hurricanes sent already high fuel prices through the roof, culminating in the record national average diesel price of $3.157 a gallon Oct. 24, as damage to Gulf Coast refineries led to some product shortages and drove nervous fuel traders to push crude prices to record highs.

As 2006 begins, most analysts are predicting a strong start for the economy and for trucking. But how the year will end is a lot less sure.

Nearly everyone is predicting truck sales will fall later in the year as the use of ultra-low-sulfur diesel fuel begins and new federal emission rules near. But it is unknown at this time how much sales will fall, or when and for how long they will remain depressed.

Many analysts say the key will be the strength of the U.S. economy. If business is booming, the introduction of new lower-emission diesel engines and ULSD fuel will be minor blips on the radar screen, they say.

But if the economy is lackluster in the second half of 2006, there is concern that the drop in the truck-supply sector could help drag down the entire manufacturing sector.

For now, however, let’s celebrate our successes in 2005 and look forward to even better times in 2006.

This editorial appears in the Jan. 2 print edition of Transport Topics. Subscribe today.