US truck load volumes continue to decline in Q1, putting pressure on carriers, but hope of expansion grows
Lower volumes reported by 62% in industry survey, but expectations of increasing shipments outweighed negative sentiment for the first time in eight quarters
Truckers in the US continued to suffer declining volumes in Q1 2024 said the Bloomberg & Truckstop Truckload Survey, as 62% of carriers reported falling loads.
Respondents reported that freight carried dropped an average of 10% compared to last year in Q1 2024.
This follows a long run of falling demand for freight in the country post-pandemic, as the survey reported that up until Q1 of this year, there were seven quarters of reported decline and volumes fell by an average of 13% in Q4 2023.
This has put pressure on carriers throughout the country, especially in the context of rising costs. Seventy-eight percent were being impacted by higher interest rates, with 19% citing not replacing or adding tractors due to higher costs.
Due to that pressure, 44% of said they unclear about what the status of their business would be over the next six months and 9% said they would like to shup up shop. Forty-five percent of respondents in the survey operate a single tractor, so it seems likely that many of these smaller operators are weighing up their options.
However, the survey appears to point towards a trough now being reached, as green shoots of optimism now outweigh negative sentiment in the industry.
The survey’s Market Demand Index rose 9% year-on-year, as a third expected freight demand to rise over the next three-to-six months, while 19% thought it would fall, the latter of which declined 12% compared to the previous quarter.
Similarly, expectations for rates has improved as 28% think they will be able to charge more versus 26% forecasting declines, also an improvement over the last quarter to the tune of a 6% positive shift.
“The industry remains flush with capacity," said Lee Klaskow, senior freight transportation and logistics analyst at Bloomberg Intelligence. However, he also said that “the improved sentiment coupled with Truckstop's rising Market Demand Index suggest rates may move higher from here.”