Fitch: Recent Storms Will Not Have Long Term Impact on Supply Chains

Major hurricanes that had hit parts of the U.S. in the recent past will lead to more tepid growth for U.S. transportation for the remainder of this year, according to Fitch Ratings in a new report. But analysts do not see any lasting disruption.

The good news for supply chain managers is that growth for 2017 is already surpassing that of last year for all major U.S. transportation segments thus far.

“Growth will slow somewhat in the coming months following the fallout of Hurricanes Harvey and Irma, though steady broader economic growth will help absorb the short term shock of these storms,” said Director Stacey Mawson.

Airports, ports and toll roads all saw healthy growth through the first half of 2017.

“Airport growth will continue to level off due to a softening of capacity and traffic, which will likely carry over into 2018,” said Senior Director Seth Lehman.

Fitch Director Emma Griffith told SCMR in an interview that ports will likely see growth in line with the movement of GDP, though volume may see short-term reductions due to the recent storms.

“Ports in the Gulf and Southeast are always vulnerable to these weather events,” she said. “But, fortunately, they are well prepared and recover quickly.”

Director Scott Monroe noted that roads in the Southeast and Southwest are likely to take a minor hit following the tolling shutdowns associated with the storms, though it should not alter the favorable outlook for the region over time.

Rating Outlooks across airports, ports and toll roads will remain mostly Stable.

Moderate growth will likely be offset by increasing capital improvement spending needs across all sectors. Conversely, a national or regional economic slowdown would dampen traffic and revenue growth trends in affected regions.

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