As per the latest Bloomberg/Truckstop survey, which gathered insights from owner-operators and small fleets, the majority of respondents believe that the current demand has reached its lowest point.
“The worst may be near for the North American truckload spot market,” said Lee Klaskow, senior freight transportation and logistics analyst at Bloomberg Intelligence. “Capacity could drop as rates hover near or below operating costs, which is crucial for the spot market to reach equilibrium.”
The 4Q23 Truckload Survey reveals the following key findings:
- Demand challenges may be stabilizing: Despite ongoing pressure on demand during the fourth quarter, 68% of respondents reported lower volume, and 23% indicated that loads remained flat. However, a significant portion (40%) of respondents expressed the belief that current demand has hit its bottom, projecting a period of flat volume over the next 3-6 months. This marks a 10-percentage-point increase compared to the 3Q survey.
- Reluctance in tractor purchases: Carriers remain cautious about acquiring additional tractors, with only 14% considering a purchase in the next six months. A substantial 44% identified weak demand as the primary reason for refraining from equipment purchases.
- Potential bottoming of spot rates: Respondents largely perceive that spot rates, excluding fuel surcharges, have reached a plateau, experiencing an average 14% drop in 4Q. About 46% anticipate these rates to remain flat in the coming 3-6 months, while 32% foresee further declines, and 22% expect an improvement.
- Resilience among carriers: Against the backdrop of a soft economy and challenging comparisons, loads decreased by an average of 13% in the fourth quarter. This uncertainty has left 43% of owner-operators unsure about their status in six months, with 12% contemplating leaving the industry.
These survey insights provide a snapshot of the current sentiments and expectations within the trucking industry, highlighting both challenges and potential stabilization in various aspects of the market.
“We share the sentiments of our customers and hold an optimistic outlook that spot market conditions will improve this year,” said Kendra Tucker, chief executive officer, Truckstop. “Built on top of the most trusted freight network in North America, Truckstop is committed to empowering carriers with our unmatched portfolio of technology solutions they need to run their business in this dynamic landscape.”
Source: The Trucker
