Even before the recent escalation of tensions in Ukraine, with the consequent upward pressure on global  crude oil prices, I have been concerned about the effects of rising fuel prices on all aspects of transportation.  Fuel prices affect us as consumers two ways.  The first, of course, through the prices we pay to fill up out own vehicles.  The second, which we often forget, is how fuel is required to make and move all the goods and most of the services we consume.  So, we take a double hit.

There had been some hope that fuel prices would stabilize as production rose to meet the higher levels of demand associated with the recovery from the pandemic.  Those hopes are fading both because of the uncertainty in global supply and the ability of producers to exercise full pricing power.

Over the past several months, gasoline prices have been adding almost two percentage points to the headline rate of inflation.  We expect them to continue to do so for the foreseeable future.

Truckable Economic Activity

We are beginning work on the next edition of the Truckable Economic Activity (TEA®) newsletter.

With any luck (always a key part of the analytical process) we will be able to start to draw firmer inferences about the sustainability of the progress we have made with TEA® over the past two years.

In particular, we will be interested to see how several aspects of the supply chain problem are being worked out.  While most of the attention has been focused on imports and exports, we are equally concerned about how the construction and vehicle manufacturing sectors are faring.  We will also be taking a close look at consumer spending, which is the largest part of TEA®.

Also on tap is a further look into inflation. You might recall that when we began to talk about this last year we advised you that the rising price trend that had surfaced would be neither temporary nor tame.  How and why inflation continues to be a problem will have a large effect on how the Federal Reserve embarks on its next round of interest rate increases..

E-commerce Parts Purchasing Study

Our 2022 E-Commerce Parts Purchasing Study has been completed! With input from nearly 800 fleets and 100 distribution channel businesses, our Study explores many aspects of e-commerce — from current online purchases, obstacles preventing online purchasing, favorite online sources, website and parts attributes desired by online purchasers, best and worst online experience, frequency of ordering and much more. Please reach out to John Blodgett or Travis Kokenes to learn more about this Study.

Hope to see you!

The Spring Conference Season is just around the corner. We hope to see you at an upcoming event!

• TMC - American Trucking Association, March 7-10

• AMDA, Asociacion Mexicana de Distribuidores de Automotores, March 7 Online

• Work Truck Week, March 8-11

• MATS - Mid-America Trucking Show, March 24-26

• IAA, September 22-24 

• Trade show – ANPACT, Oct 5-7th

DataMac® Mexico 2022

Since MacKay & Company’s initial study of the Mexican heavy-duty market in 1992, many of the economic – and vehicular – differences between Mexico and the United States have become less significant. Vehicle maintenance practices, for example, are changing to mirror those practices more common in the United States. And parts purchasing practices have also shifted, again to more closely resemble those in the U.S. 

The most recent DataMac Mexico Study was completed in 2018. At that time, the Mexican truck and bus markets were growing, as was the aftermarket. Total medium- and heavy-duty truck and bus parts potential in Mexico was positively impacted by growth in both power transmission and undercarriage components. At that time, vehicle operators utilized the independent garage channel to purchase the largest percentage of the parts required on medium- and heavy-duty vehicles. 

What has changed in four years since our comprehensive evaluation of the Mexican market? A new look into the truck and bus market in Mexico will be a key factor in planning for growth in Mexico. How has the pandemic impacted the market? If you have areas of interest or input for our upcoming DataMac Mexico Study, please contact John Blodgett.