When securing capacity in the full-truckload freight marketplace, it is often challenging as it seems there are never enough trucks for the freight that needs to be hauled and shippers want to avoid the challenges for capacity they experienced the last 24 months. The forecast through 2025 is for full-truckload freight to continue to increase and stay above forecasted trend; however, Truckstop data indicates that current truckload volumes will fall in the near term and provide some capacity and rate relief. How much it falls is still to be determined. However, base capacity should stay the same in 2023 and, combined with declining spot rates, shippers should feel less stress when looking to move freight.
Contract carriers that haul full truckload freight are expected to maintain fairly high rates until the end of the year, because they didn’t negotiate existing capacity on these contracts. However, contract rates are anticipated to adjust down in 2023 so shippers should plan accordingly as they negotiate new contracts or renegotiate their existing contracts with carriers.
In the capacity game, shippers also need to pay attention to legislation such as California’s AB5 law and look to see which other states are planning to enact similar laws while also keeping an on eye on what may happen at the federal level. These state and federal regulations are very important because they will change the landscape of the national contract carrier capacity. Shippers will have to be prepared for these new “proposed” regulations that could possibly have an effect on capacity in a number of states before the end of 2023 and into 2024. Carriers working as independent contractors for truck fleets need to act quickly to ensure their business keeps running smoothly. Shippers and carriers need to fully understand the AB5 type trucking laws and how they might impact them, and how to manage any necessary business model changes in California or other states as they are enacted. Legislation and FMCSA regulations are vitally important to pay attention to as they have highly influenced the past four capacity crunches and will continue to influence the availability of capacity in the future.
Brent Hutto, Chief Relationship Officer, Truckstop