PORTLAND, Ore. – Trucking rates are on the rise in the U.S. as available truck capacity continues to tighten – thanks to strong economic conditions and mandated electronic logging devices, industry analysts are showing.
In fact, trucking capacity south of the border has essentially “maxed out”, analysts at FTR reported today.
“Fleets have been running very efficiently the past few years, with capacity utilization in the high 90% range. Couple this efficiency with increases in freight volumes and productivity hits due to weather and regulations, and it’s no surprise to the industry that the end of 2017 and the beginning of 2018 have been good for carriers,” said Jonathan Starks, chief operating officer.
“We are seeing robust orders for trucks and trailers, serious recruitment drives, and the type of rate increases which make these expenditures feasible. In terms of the overall economy and freight demand, we are looking at strong potential for further upside possibilities for carriers.”
FTR’s Trucking Conditions Index.
The findings were based on the analysts’ Trucking Conditions Index, which tracks freight volumes, freight rates, fleet capacity, fuel price, and financing.
DAT Solutions, which operates North America’s largest truckload freight marketplace, has reported similar findings. Its spot truckload rates for van, reefer, and flatbed freight hit new highs in January, citing shipper demand and the mandated electronic devices as the reasons.
The national average spot van rate reached a record US $2.26 per mile in January, up 15 cents compared to December, and 59 cents higher than January 2017. (All its rates are expressed in US dollars.) January’s spot rate was also 14 cents higher than the average contract rate, which means truckload carriers were paid more for one-time loads from freight brokers than longer-term contracts negotiated with shippers, DAT reports.
The national average spot reefer rate hit levels not seen since 2010, at $2.66 per mile – 18 cents higher than December and 71 cents higher than January 2017. It was 31 cents higher than the average contract rate, which DAT referred to as an “extraordinary gap for reefer freight in January.”
The U.S. average flatbed spot rate reached $2.39 per mile, seven cents higher than the previous month and 47 cents higher year over year. The flatbed linehaul rates excluding fuel were higher than any previous month. When fuel charges were added, the rates sit a few cents lower than the summer of 2014, when average surcharges were 20 cents above those seen today.
“Many fleets have reported that the transition [to ELDs] can hamper productivity, at least temporarily,” the company says.