NEW YORK--(BUSINESS WIRE)--Despite a robust Thanksgiving traffic forecast, Fitch Ratings believes overall US traffic growth on toll roads will remain nearly flat for the rest of 2014. We also expect that toll increases broadly in line with inflation will lead to revenue growth of 2%-3% above traffic growth. A survey by the AAA auto club projects a 4.2% traffic increase this Thanksgiving weekend over last year and the highest volume since 2007.
Year-on-year traffic growth on Fitch-rated US toll roads was approximately 5% in the second quarter. This was in the same range as growth rates in the second half of 2013 and after unseasonal cold and snowy winter conditions suppressed traffic growth in first quarter 2014, primarily in the northeast and midwest. National vehicle-miles travelled followed the same pattern, contracting slightly in the first quarter but returning to just above 0% in the second quarter.
We believe the shrinking gap between revenue and traffic growth has also stabilized. It was in the 2.5%-3.0% range in the first-half 2014 and we expect it to stay in that range through the coming year. Toll increases appear to have settled around the same level as inflation after well-above inflation increases were established to offset the decline in traffic during the economic downturn.
Additional information is available on www.fitchratings.com.
The above article originally appeared as a post on the Fitch Wire credit market commentary page. The original article, which may include hyperlinks to companies and current ratings, can be accessed at www.fitchratings.com. All opinions expressed are those of Fitch Ratings.
Applicable Criteria and Related Research:
Global Infrastructure & Project Finance U.S. Transportation Trends Fall 2014