Truck Driving Job News

COLUMBUS, Ind. — The latest release of ACT Research’s For-Hire Trucking Index suggests the supply-demand balance between the fleet and freight is narrowing. The Volume Index decreased 5.5 points in June to 48.9, seasonally adjusted (SA), from a Roadcheck-assisted 54.4 in May. “Volumes have been fairly flat this year, but they’ve improved to ‘less bad’ on a y/y basis, with the index averaging 48.8 through the first half of this year, versus 42.8 last year,” said Carter Vieth, the research analyst at ACT Research. “Even with consumers under strain, real US retail sales are up 1.8% YTD, and further disinflation helps support our outlook on real income growth. Additionally, intermodal and import volumes are trending positive, which minimally adds to overall surface freight volumes. Private fleet insourcing has likely taken away some for-hire demand, but the recent softening in US Class 8 tractor sales indicates a slowing in private fleet growth.” Overall, truckload volume data remain mixed, with the Cass Freight Index and DAT spot loads still at cycle lows. The Capacity Index increased by 3.6 points m/m to 49.3 in June, from 45.6 in May. “Though the index increased m/m, this month’s reading marks the 12th month in a row capacity has been below 50, the longest streak of decline since the inception of the survey in late 2009,” Vieth added. “Fleet capacity contractions occurring at a slower rate suggest the supply-demand balance between the fleet and freight is narrowing. Given the duration of this downturn and the still-weak fundamentals, it’s hard to see capacity turning positive in the coming months, especially as the US tractor sales trend continues to sag.” The Supply-Demand Balance fell in June to 49.6 (SA) from 58.7 in May, as freight volumes decreased and fleet capacity increased. “Private fleet expansion, which is not captured in this indicator, is resulting in a longer leadup to higher market rates than in past cycles. With capacity an issue, overall equipment purchasing trends will remain key to watch. Continuing demand-side freight growth should provide ongoing support to the market balance,” Vieth concluded.    

ATLANTA, Ga. — AFS Logistics, a third-party logistics (3PL) provider, and TD Cowen have announced the third quarter (Q3) 2024 release of the TD Cowen/AFS Freight Index, a snapshot with predictive pricing for truckload, less-than-truckload (LTL) and parcel transportation markets.   “The current state of freight markets empowers shippers to wield pricing power and re-evaluate how to best make use of logistics networks,” said Tom Nightingale, CEO of AFS. “Carriers, on the other hand, continue to step up the sophistication and nuanced defenses of their revenue streams, with subtle and frequent ancillary price increases.”  According to a press release, the index shows the uneven effects of continued demand and capacity imbalances playing out across multiple transportation modes. While LTL carriers are holding the line with pricing discipline, parcel rates are showing the effects of aggressive discounting and excess truckload capacity continues to suppress a pricing recovery. Data indicates a favorable market for shippers, highlighted by intense price competition among parcel carriers and the sixth-straight quarter of truckload rates hovering at the floor,  Truckload: Still waiting for a rate recovery  The truckload rate per mile index established a floor in Q2 2023 of 4.3% above the January 2018 baseline, and Q3 2024 is expected to be the sixth straight quarter with rates bouncing along that bottom. The index projects rate per mile to drop slightly to 4.7% in Q3 2024, a 0.3% decline from the 5.0% mark of the previous quarter. In Q2 2024, average linehaul cost per shipment also declined, down 2.7% quarter-over-quarter (QoQ), as the share of short-haul shipments remained relatively flat. For additional context, although Q2 linehaul cost per shipment was down 14% year-over-year (YoY), it was still 11% higher than pre-pandemic levels.  “With truckload seemingly stuck at the bottom for over a year, speculation is rampant as the market looks for any sign of a recovery finally materializing,” said Andy Dyer, president of transportation management for AFS. “Recent increases on the spot market do provide a limited upward push, but with contract rates still slightly decreasing and no clear macroeconomic catalyst to spark increased demand, we’re projecting rates to keep hovering where they’ve been since Q2 of last year.”  Parcel: Major discounting overpowers accessorial changes The media release also noted that parcel carriers have found themselves in a contradictory cycle – frequently hiking surcharges to squeeze additional revenue from limited demand, but simultaneously deploying heavy discounting to compete for those modest volumes. Repeated increases to fuel surcharges even as fuel prices are falling have resulted in a growing divergence between surcharges and the actual price of fuel.   The ground fuel surcharge would be 5.5% lower if FedEx and UPS allowed the ground fuel surcharge to purely follow market dynamics based on the EIA on-highway diesel price. However, major discounts spurred by the low-demand environment blunt the effect of the surcharge hikes.   “The ‘competitive but rational’ language used by carriers to describe the market did not signal cooling discounting activity, as the pursuit of volume drove liberal discounting in both express and ground parcel,” said Micheal McDonagh, president of parcel for AFS. “Carriers are also applying discounts to pursue the highest-profit customers. Small- to medium-size shippers are seeing exceptional discounts that might typically be reserved for much larger customers.”  Discounting played a major role in the ground parcel rate per package index declining from 28.8% to 26.8% in Q2 2024, and that trend is expected to continue in Q3, dropping to 25.7%, according to the release. Cost per package also decreased in Q2 2024, driven by an average discount increase of 0.9% QoQ and a 5% reduction in net accessorial charges per package – not an indication of carrier leniency, but further evidence of carriers’ aggressive discounting.  The release noted that the express parcel index is also expected to fall, from 4.7% in Q2 2024 to 2.8% in Q3 2024. This projection is in line with seasonal trends and an expectation for heavy discounting behavior to continue in Q3. In Q2 2024, the average discount in express parcel increased 0.7% QoQ, though the cost per package actually increased marginally compared to Q1, driven by weight, service mix and fuel surcharge changes.  LTL: Carrier discipline keeps rates elevated, though cost per shipment continues to fall  “Looking at shippers’ efforts to capitalize on cost saving opportunities in today’s freight market provides a rationale for the decreasing weight per shipment we see in LTL,” says Dean Jones, president of LTL for AFS. “Two examples show how inbound and outbound flows at both ends of the weight spectrum push this overall trend – seeking relief from the punitive charges of parcel carriers pushes lighter freight into LTL networks, while pursuing the efficiency of consolidated, multi-stop truckload pushes heavier freight away from LTL carriers.” According to the release, declining weight per shipment and a lower average fuel surcharge drove a 2.6% QoQ decline in LTL cost per shipment in Q2 2024, though rate per pound showed modest QoQ growth – a testament to carrier discipline and graduated pricing structures that make lighter shipments more expensive. Looking ahead to Q3, the LTL rate per pound index is projected to reach 63.2% – a slight 0.3% QoQ increase as market conditions remain steady and carriers maintain discipline. 

BLOOMINGTON, Ind. — FTR’s Shippers Conditions Index for May improved to 4.5 from April’s 3.0 reading.   “May was almost a repeat of April aside from fuel costs,” said Avery Vise, FTR’s vice president of trucking. “Freight rates were the most favorable for shippers they had been in a year, but we expect them to return to the softer climate seen during the first quarter.”  According to an FTR press release, falling diesel prices bolstered a favorable rate environment for shippers while other factors were only marginally favorable and mostly stable month over month. FTR forecasts that the index will move closer to neutral territory and then turn slightly negative by late this year as key freight dynamics – volume, utilization, and rates – start to become at least occasionally unfavorable for shippers.  “Our outlook for freight volume has strengthened a bit, putting at least some upward pressure on both capacity utilization and rates,” Vise said. “However, shippers likely will see conditions that are more accurately characterized as neutral rather than negative. Ample capacity in trucking continues to discipline the freight market.”   The July FTR’s Shippers Update, published July 5, provides a detailed analysis of the factors affecting the May Shippers Conditions Index and provides the forecast for this index through May 2025. Additional commentary in the July edition discusses how the growing production of computer and electronic products compares to the otherwise sluggish U.S. manufacturing output.   The Shippers Conditions Index tracks the changes representing four major conditions in the U.S. full-load freight market. These conditions are freight demand, freight rates, fleet capacity, and fuel price. The individual metrics are combined into a single index that tracks the market conditions that influence the shippers’ freight transport environment. A positive score represents good, optimistic conditions. A negative score represents bad, pessimistic conditions. The index tells summarizes the industry’s health at a glance.

WASHINGTON — The American Trucking Associations’ (ATA) advanced seasonally adjusted For-Hire Truck Tonnage Index decreased by 1.6% in June after increasing by 3% in May. In June, the index equaled 113.5 (2015=100) compared with 115.3 in May. “While giving back some of the gain from May, it appears that truck freight tonnage is slowly going in the right direction since hitting a recent low in January,” said Bob Costello, chief economist for ATA. “Despite June’s decline, the second quarter average was 0.2% above the first quarter and only 0.2% below the second quarter in 2023, which are good signs that truck freight might be finally turning the corner.” May’s increase was revised down from the association’s June 18 press release. Compared with June 2023, the index decreased 0.4%. In May, the index was up 1% from a year earlier, which was the first year-over-year gain since February 2023. The not-seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment, equaled 113.1 in June, 5.5% below May. ATA’s For-Hire Truck Tonnage Index is dominated by contract freight rather than traditional spot market freight. In calculating the index, 100 represents 2015. ATA calculates the tonnage index based on surveys from its membership. This is a preliminary figure and is subject to change in the final report, which is issued around the fifth of each month. The report includes month-to-month and year-over-year results, relevant economic comparisons and key financial indicators.

Buying and operating their own truck is an option many commercial drivers take advantage of. Before taking the plunge and shelling out money on a tractor, however, there are several things to consider. There are multiple ways to obtain a truck and there are several options for how you’ll run it once you own it. One of the first choices you’ll need to make is whether your business will be completely on its own or you’ll enter an agreement as an independent contractor (IC). In a strange twist of words, you’ll be far more “independent” operating under your own authority than if you lease your truck as an IC. However, if you’re buying your first truck, It might be best to start with the structure of a large carrier. Carriers provide numerous services. There’s a management hierarchy of course, starting with the CEO or president and working down to individual fleet managers or dispatchers. If you decide to operate completely independently, you’ll be responsible for fulfilling the roles of all of these positions … and that’s only the beginning. A large carrier will have a sales department that keeps relationships going smoothly with existing customers while seeking out new ones. A customer service team works with customers to secure more loads and make sure everything is running smoothly. There’s a billing or collections team that sends out bills and collects payments, including someone to contact customers that don’t pay on time. Aso, an accounts payable department keeps the bills paid. A carrier’s safety department does a lot more than conduct meetings and discipline drivers who’ve made mistakes. They’ll make sure the carrier is in compliance with regulations and utilize technology and driver training to help keep accidents down and help the company secure the most favorable insurance rates. The team that registers trucks and obtains needed permits is usually attached to the safety department, but not always. Compliance with drug and alcohol testing requirements usually falls under safety as well. Don’t forget the maintenance division. They’ll work on trucks, deciding when to farm out work to vendors if projects are more than their technicians can handle. They’ll also keep a network of vendors for on-road repairs when necessary. Often, maintenance keeps track of fuel cards and develops a network of fueling locations. There’s also a driver recruiting department. Of course, if you’re driving your own truck you won’t need a recruiting department — but recruiting isn’t all they do. This team is generally responsible for checking the background of new driver applicants, making sure the files are complete for each one. And don’t forget human resources and benefits teams that make sure benefits are administered properly. Human resources is often involved in selecting the insurers that provide health, dental, vision and other coverages for employees. Once you purchase your own truck, you’ll be responsible for the tasks performed by all these departments. It takes a lot of work — and more importantly, it takes knowledge and experience to become good at all of them. After all, if you’re busy chasing down payment for a reluctant customer, setting up an account with a new one and verifying that you’re in compliance with drug and alcohol regulations, it can be difficult to work time into your schedule to actually pick up and deliver freight. That’s why some truck owners choose to enter into a lease agreement for their equipment. The lease agreement basically says that the carrier can use your truck to haul their freight, but you must provide a driver and take care of the costs of operating a trucking business, such as fuel and repairs. In return, the carrier supplies loads for which you are paid an agreed amount per mile or a percentage of load revenue. You’ll be gaining the benefit of the work of all those other departments — but keep in mind that the carrier shares the revenue earned with you. Being an IC does have its downside. One large drawback you’ll face as an IC is that you won’t be paid employee benefits like health insurance, retirement accounts and vacation or holiday pay. Since you’re working for your own company, you’ll be responsible for providing those benefits for yourself. Some ICs benefit from a spouse that earns those benefits at a job. Another drawback is that you’ll need to pay self-employment tax. Company employees benefit because the employer pays half of their Social Security and Medicare taxes. As an IC, however, you’ll pay both the employee and employer shares of this tax. Being an IC offers benefits, too. As an IC, you should have freedoms that employee drivers don’t have. You can choose the hours you work, the routes you take, fueling locations and more. You can even choose which loads to take and which to refuse, or what areas of the continent in which you want to run. A word of caution: Your relationship with the carrier is important. If you only take the best loads, or if you aren’t available when needed, your carrier may think you’re difficult to work with. When that happens, the loads you’re offered could change or be harder to come by at all. Think about the kind of service you want from businesses you might deal with, such as a plumber or maintenance shop. If your plumber isn’t available when needed, or doesn’t perform the work on schedule or presents a bill much higher than the original estimate, you might be tempted to use a different one next time. Think of the carrier to which you’re leased as your customer, and provide the level of service to them that you expect from others. Are you ready to take on the responsibilities? If you make the decision to obtain your own operating authority and manage your own business, you ARE a carrier. Many carriers have logistics departments; these are actually freight brokerages, so you can still run the carrier’s freight without a lease agreement. You can select one trusted broker to deal with or deal with a different one every day if you like. Even better, you can develop your own relationships with shippers and avoid brokered freight altogether. Running your own trucking company means different things to different owners. The more independence you seek, however, the more responsibility you’ll take on. Some owners have a spouse that takes care of the administrative work while they focus on the driving, while some do it all themselves. It’s not unusual for an owner to start a lease to a carrier and then obtain authority as they learn more about their business, and themselves.

COLUMBUS, Ind. – The freight market continues to be characterized by overcapacity, and with private fleets engaging in spot activity more than in past cycles, spot rates remain only slightly above the late-2023 lows, according to the latest release of the Freight Forecast: U.S. Rate and Volume OUTLOOK report. “Class 8 tractor backlogs are thinning, but retail sales remain above replacement, more than two years after the spot market turned down,” said Tim Denoyer, ACT Research’s vice president and senior analyst. “This fits the definition of a prebuy to a tee.” According to Denoyer, mid-July rates have exceeded seasonal patterns by around four cents due to a temporary boost from Hurricane Beryl. The storm hit during a seasonally soft period for the truckload spot market. Storms during stronger seasonality may have a larger impact on rates.” “Freight market conditions are usually soft in early July, but DAT’s load/truck ratio rose meaningfully in the days following Beryl and have remained stronger than normal seasonality since,” Denoyer said. “Of course, the surge will likely be short-lived. But in our view, a seasonally adjusted DAT load/truck ratio at 7 signals a market closing in on balance, if still not quite there yet. We need to see this measure at an 8 or 9 to push rates up much.” The DAT load/truck ratio isn’t exactly a scale of 1 to 10. It can go further than 11. It reached the mid-teens in 2017 and early 2018 and the high teens during 2021, peaking above 20. The monthly 58-page ACT Freight Forecast report provides analysis and forecasts for a broad range of U.S. freight measures, including the Cass Freight Index, Cass Truckload Linehaul Index, and DAT spot and contract rates by trailer type. The service provides monthly, quarterly, and annual predictions for the TL, LTL, and intermodal markets over a two- to three-year time horizon, including capacity, volumes, and rates.