According to the latest Bloomberg | Truckstop survey, which polled owner-operators and small fleets, sentiment among North American carriers operating in the truckload spot market has improved over the past three months, but some concerns still linger.
"The industry is emerging from a challenging quarter, and the improved sentiment coupled with Truckstop's rising Market Demand Index suggest rates may move higher from here," said Lee Klaskow, senior freight transportation and logistics analyst at Bloomberg Intelligence. "The direction of rates will be driven by supply-side factors as the industry remains flush with capacity."
The Bloomberg | Truckstop 1Q24 Truckload Survey shows:
- Demand remained under strain in 1Q: Despite 62% of carriers reporting lower freight volume in 1Q, 33% predict freight demand to increase in the next 3-6 months. Only 19% predict freight demand to decline in the same timeframe, which represents a 12-point percentage decline vs. the 4Q survey.
- Encouraging signs the market may be starting to improve: The survey revealed that a majority of carriers believe better times are around the corner with Truckstop's Market Demand Index up 9% in 1Q from last year, the first year-over-year gain after seven quarterly declines. Only 26% expect rates to decline over the next 3-6 months, 6 percentage points less than in the 4Q survey, while 28% see rates rising, which is 6 percentage points more than in 4Q.
- Carriers uncertain about their futures: Forty-four percent (44%) of respondents were unsure about their status in six months and 9% said they wanted to leave the trucking industry. More than three-quarters of respondents (78%) said higher interest rates in 1Q affected their businesses. Elevated rates can have a significant impact on equipment-financing expenses, with 19% citing increased costs as the main reason they're not replacing or adding tractors. Though demand was challenging for carriers in 1Q, with loads dropping an average of 10%, that was slightly better than the 13% decline in 4Q.
"We're all eagerly anticipating a more positive shift in the tide," said Kendra Tucker, chief executive officer, Truckstop. "Truckstop continues to be a trusted partner, committed to delivering innovative solutions to help carriers navigate this ever-evolving business landscape."
The Bloomberg | Truckstop survey of owner-operators and small fleets provides timely channel checks into the health of the spot market. The sample size was 225, consisting of dry-van, flatbed, temperature-controlled and specialized/diversified, hot-shot and step-deck carriers. Of the respondents, 45% operate just one tractor.
