Logistics spending in the U.S. drops in 2008
Overall logistics market size declines for the first time since 2002
Dave Hannon -- Purchasing, 6/19/2009 2:20:22 PM
Transportation spending breakdown
Trucking: Up 1.3%
Rail: Up 10.5%
Maritime/domestic water: Up 2.6%
Air freight: Down 2.4%
According to a new report from the Council of Supply Chain Management, the overall logistics market in the U.S. declined 3.5% last year to $1.3 trillion, it's first such decline in six years. Logistics as a percent of GDP dropped also to 9.4% of U.S. GDP, down from 10.1% of GDP a year earlier.
In its recently released State of Logistics report, CSCMP reports that a massive 13.2% decline in inventory carrying spending dragged the overall logistics market down in 2008, while transportation spending ticked up 2% last year (but was well off the7% increase seen in 2007).
Overall spending on trucking, which comprises 78% of the transportation component, was up 1.3% compared to 4.4% for the other modes. Rail transportation spending was up a significant 10.5% in 2008, despite the fact that rail and intermodal volumes were well down.
"Purchasing and ordering decreased, inventory levels rose and volumes shipped plummeted," the report said. "Abundant capacity, particularly in trucking and ocean shipping, pushed rates down, often below costs."
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