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Aside from a short-lived Labor Day disruption that reignited contract routing guide and rate volatility, freight market conditions changed little from August to September.
However, with the national average diesel price recently surging to an all-time high, fuel costs are adding rate pressure and tightening capacity nationwide, especially in areas where it has become particularly expensive for carriers to operate. Strong global demand for U.S. diesel is also pushing domestic refineries near full utilization as stockpiles continue to fall, which means prices may remain elevated for some time.
Outside of these pressures, contract reconfigurations and softer seasonal demand have improved routing guide performance, reduced spot utilization and helped pull rates back toward an elevated floor. Stronger pricing has yet to spark the kind of supply growth typically seen at this point in an inflationary cycle as carriers remain focused on replacing aging equipment and improving driver wages and benefits rather than expanding their fleets amid ongoing regulatory enforcement.
Demand has also remained resilient in several key areas. Data-center construction continues to drive strong freight activity, August imports reached the third-highest monthly total on record and early tariff refunds could spur retail inventory restocking ahead of potential new duties. At the same time, a weakening economic backdrop is increasing downside risk to demand as sticky inflation, rising interest rates and higher diesel costs threaten consumer spending power and could prolong the housing downturn.
With no major seasonal disruptions expected before Q4 peak, the market should remain relatively stable in the near term, but the lack of meaningful supply growth leaves it primed for another inflationary push when winter weather, holiday demand and capacity tightness take hold.
Read on for a deeper look at the demand, supply, rate and economic data shaping the road ahead.
Truckload demand softened through August as accepted volumes and spot load postings continued to decline. However, imports reached the third-highest monthly total on record, and manufacturing stayed in expansion territory. Data-center activity also remained a source of strength, and tariff refunds may be supporting additional retail inventory restocking.
Demand should remain soft in the near term, with downside risk increasing as sticky inflation, rising interest rates and higher diesel costs weigh on the broader economic outlook. Data-center activity and potential inventory restocking still offer some upside, while a pullback following recent import front-loading could add further pressure later in the year.
Capacity tightness eased from summer peak levels as routing guide performance improved and the Labor Day disruption faded quickly. Even so, the market remained tight as spot equipment postings reached their lowest level in more than a decade and carriers continued to prioritize equipment replacement over fleet expansion.
Current capacity levels should be enough to support near-term demand. However, with carrier challenges persisting and limited fleet growth on the horizon, holiday demand and winter weather could tighten capacity quickly and create significant volatility.
Spot linehaul rates moved lower from July into August as summer peak pressure faded and routing guide performance improved. Late-August and Labor Day disruptions briefly pushed van and reefer pricing higher, but those gains faded quickly, leaving September levels roughly in line with August and below summer peaks. Recent record diesel prices have also pushed all-in rates higher despite softer linehaul pricing.
Fuel volatility should continue to put upward pressure on all-in rates. However, linehaul rates should see limited movement from current levels in the near term, with strong routing guide compliance and softer demand limiting any sustained increases between now and the start of the Q4 holiday push.
Consumer spending remained solid in August, while employment rebounded and unemployment held at 4.1%. Inflation was unchanged at 3.4%, and record diesel prices added cost pressure as global demand for U.S. diesel strained domestic supply.
Consumer spending and labor market conditions should be relatively stable in the near term, but persistent inflation and elevated borrowing costs could weigh on business investment and housing activity, both key drivers of freight demand. Diesel prices also remain a risk, with refinery utilization near full capacity and stockpiles continuing to fall.
The Canada-U.S. tariff fight has escalated further. After U.S. tariffs of up to 50% on Canadian goods took effect in late August, Canada retaliated on September 8 with its own 15% to 50% tariffs on about $27.6 billion of U.S. goods. Cross-border volume has shifted in both directions as a result. Rates remained low through the slowdown, but recent spikes in diesel prices are driving significant day-to-day rate swings and prompting carriers to push for increases to cover the additional costs.
Volatility is expected to continue as rising fuel costs run up against soft freight demand. However, carrier-driven rate increases are likely to gain ground even without a volume recovery. The trade situation remains unsettled, so further tariff changes could shift the picture again, making a stable baseline unlikely in the near term.
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Matt Pyatt is the Chief Executive Officer of Arrive Logistics. He co-founded Arrive with President Eric Dunigan in 2014 after building his career at Command Transportation. As CEO, he is responsible for overseeing the company’s financial health, strategic vision and culture, as well as building a scalable leadership team to support Arrive’s growth.
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Scott Sandager is the Chief Administrative Officer at Arrive Logistics. He joined Arrive in 2018, bringing over 14 years of logistics and brokerage experience, with expertise in project and change management, organizational design, talent development and customer satisfaction. Scott previously held many diverse roles of increasing responsibility with AFN, a Chicago-based freight brokerage.
Eric Dunigan is the President of Arrive Logistics. He began his career at Command Transportation before co-founding Arrive with Matt Pyatt in 2014. As president, he is responsible for driving revenue and growth, as well as leading the Strategic Partnerships team — a veteran group of supply chain experts who work with Arrive’s customers to reimagine their shipping strategy.
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David Spencer is the Vice President of Market Intelligence at Arrive Logistics. David joined Arrive in 2017 after spending six years at AFN focused on business intelligence. His department provides critical market data and expert analysis to internal teams and publishes monthly market updates for shippers and carriers under the Arrive Insights banner.
Andrew Clarke is Board Chairman for Global Critical and DCLI, Inc., and a board member for Arrive Logistics and Element Fleet Management Corp. His 20 years of global transportation and logistics experience include time as CFO of C.H. Robinson, CEO of Panther Expedited Services, Inc. and SVP and CFO roles at Forward Air Corporation.
Dean Croke is a Market Analyst at DAT Solutions, where he focuses on freight market intelligence and data analytics. His 35 years of experience with data analytics, transportation, supply chain management, mining and insurance risk management include time as co-founder of FleetRisk Advisors and in a number of other high-level roles with FreightWaves, Spireon, Lancer Insurance, Omnitracs Analytics (formerly Qualcomm) and more.
Asanka Jayasuriya is the CTO at 8VC. He is an accomplished engineering and product leader with 20+ years of experience in the cloud. He has a strong background in enterprise SaaS, PLG products, infrastructure, and security. Notably, he served as CTO and SVP of Engineering at SailPoint, leading their successful transition to the cloud and successful exit event. He also held senior leadership roles at InVision, Atlassian, and Amazon, driving growth, operational excellence, and innovation. At 8VC, Asanka works with the entrepreneurs and leaders in our portfolio as a virtual CTO supporting their growth.
Chad Eichelberger is the President of Reliance Partners. Since 2015, he’s leveraged his extensive experience in risk management, compliance, best practices and contracts to lead the company’s logistics and truck insurance strategy and operations. Chad was previously the President of Access America Transport, where he led the company from $8M to over $600M in revenue.
Barry Conlon is the CEO and founder of Overhaul, the global leader in active supply chain risk management and intelligence. With a remarkable career spanning over 30 years in supply chain security, he is widely regarded as a trailblazer in modern-day supply chain security standards and best practices.
As VP and Senior Analyst at ACT Research, Tim analyzes commercial vehicle demand and alternative powertrain development (i.e. electrification), and authors the ACT Freight Forecast, U.S. Rate and Volume Outlook. He previously spent fifteen years in equity research focused primarily on the transportation, machinery, and automotive industries, and co-founded leading equity research firm Wolfe Research.
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