The Calm Before a Freight Storm

Right now, trucking feels stuck in neutral. Freight demand is weak, spot rates have cooled, and both carriers and brokers are under strain. Many in the industry describe this moment as the calm before the storm, with indicators pointing toward a major correction that could rival the market chaos of the COVID years.

The warning is clear: if 600,000 drivers leave the market, capacity will tighten quickly and spot rates could skyrocket. Unlike during the pandemic, there will be no surge of new immigrant drivers to fill the gap. That relief valve, once supported by open immigration policies, is now closed. Carriers will have to compete harder for qualified drivers through better pay, sign-on bonuses, and improved working conditions.

What’s Fueling the Freight Downturn

Freight volumes are down 18 percent year over year, hitting carriers of every size. For freight brokers, the challenge is even tougher. With fewer loads to move, margins have evaporated. Some are stuck with contract rates signed too low to stay profitable, forcing them to compete against asset-based carriers while losing money on every run.

Small fleets are feeling the squeeze most. Many have relied on non-domiciled CDL drivers, but new federal regulations around English Language Proficiency are cutting off that supply. On top of that, fraud in load boards and verification systems has exploded. Scammers have found ways to manipulate tools like Highway and RMIS, forcing brokers to be more cautious.

That means even legitimate carriers can be flagged by mistake. Once that happens, they can be locked out of most brokerage freight entirely, which can be a death blow for smaller operations already struggling to stay afloat.

How New Rules Could Wipe Out 600,000 Drivers

This expected capacity purge ties directly to federal regulatory changes and immigration enforcement already underway. According to research from J.B. Hunt, new rules for non-domiciled CDL holders and English Language Proficiency requirements could remove between 214,000 and 437,000 drivers, roughly 5 to 12 percent of the U.S. driver pool over the next few years.

On September 26, 2025, the Federal Motor Carrier Safety Administration issued an emergency ruling that restricts the issuance and renewal of non-domiciled CDLs. Officials estimate that 97 percent of the 200,000 drivers who currently hold those licenses will not meet the new standards and will likely exit the industry within three years. That alone represents 5 percent of all registered CDLs in the country.

Stricter enforcement of English Language Proficiency standards has already led to 23,000 violations, including 5,000 out-of-service orders. Analyst Avery Vise projects that this enforcement could sideline about 20,000 drivers each year.

When combined with limits on undocumented drivers and new hiring restrictions, transport economist Noël Perry estimates that more than 600,000 drivers, about 17 percent of the active workforce, could be removed from trucking.

Carriers that rely heavily on immigrant labor or those unable to comply with the new regulations may not survive this purge.

The Economic Ripple Effect

These rule changes, combined with a long freight recession, are creating a perfect storm for widespread bankruptcies. Both carriers and brokers are tightening budgets and consolidating operations as the industry braces for a market reset.

The shakeout is expected to favor larger, well-capitalized carriers who can handle the new compliance demands and stay profitable through the downturn. Smaller carriers that grew quickly during the post-COVID freight boom may not have the financial cushion to adapt.

As capacity tightens, driver pay is likely to rise. Carriers will need to offer stronger incentives to attract qualified drivers from a shrinking talent pool. The shift could finally bring the market back to a more balanced place where supply and demand set the rates naturally instead of desperation driving them down.

What Comes Next

The road ahead will be rough, but it could lead to a healthier trucking market. Analysts predict that after the purge, spot rates will rise again, contract rates will stabilize, and carriers that survive will see more consistent freight and fairer pricing.

The exact timing of this recovery is uncertain, but the direction is clear. Shippers should prepare for higher rates and tighter capacity, while carriers who manage to weather the storm will be well-positioned when freight rebounds.

As one industry expert put it, “If volumes pop—which doesn’t exist right now—hold on to your hat. It’s going to be one of the best freight markets that carriers have seen in some time.”

It may take time and patience to reach that point, but for those who make it through, the rewards could be worth the wait.

Source: FREIGHTWAVES

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The trucking market is inching closer to achieving equilibrium, as trends in freight demand and capacity begin to stabilize after years of significant upheaval, according to industry experts.

During the COVID-19 pandemic, the supply chain landscape was heavily disrupted by a shift in consumer spending towards goods rather than services. This change caused an extraordinary surge in freight demand, which led to higher rates and an influx of new drivers into the industry. However, the eventual market downturn created excess capacity, leaving carriers scrambling to fill trucks.

“Broadly speaking, freight demand trends are gradually improving,” explained Carter Vieth, research associate at ACT Research. “The threat of another ILA dockworkers’ strike on January 15 has likely caused shippers to pull freight forward, and with tariffs on the horizon following the election, the pull-forward in freight is expected to accelerate further.”

ACT Research Data Highlights Steady Progress

Recent data from ACT Research indicates modest but promising signs of recovery. Its volume index rose by 7.4 points to 56.9 in October, while the capacity index dropped slightly by 1.1 points to 49.7. These changes boosted the supply-demand balance index to 57.2 points from 48.8 the previous month, suggesting a gradual return to a healthier market balance.

Market Dynamics and Key Observations

Despite this progress, Michael Castagnetto, president of North American Surface Transportation operations at C.H. Robinson, points to sustained oversupply in the market. “The trucking market is in a kind of limbo,” Castagnetto said. “I’d call it a state of stable, sustained oversupply. Freight demand hasn’t had many catalysts for growth.”

Castagnetto highlighted flat industrial production, slow housing starts, and reduced consumer spending as key factors behind the sluggish demand. However, modern technologies have enabled carriers to find freight opportunities more efficiently, helping many smaller operators stay afloat.

“One of the clearest signs of the state of the market is route guide depth,” Castagnetto added. “Typically, a sustained increase in route guide depth over several months would indicate the market is tightening and carriers could afford to be choosier about the freight they accept. Instead, our statistics show that route guide depth has remained flat.”

Optimism Among Carriers

According to a survey conducted by Truckstop and Bloomberg Intelligence on November 12, owner-operators and small fleets are starting to see some signs of improvement in the market. The survey noted that 6% more carriers expect spot rates to increase over the next three to six months, while 7% anticipate higher volumes.

However, not all news is positive. “Despite greater optimism over the outlook, more carriers expressed an intent to leave the business than in our prior survey,” said Lee Klaskow, senior freight transportation and logistics analyst at Bloomberg Intelligence. “An acceleration in carrier exits could speed up the market’s return to equilibrium and provide a better backdrop for rates next year.”

Achieving Market Stability

Jacob Faunce, carrier relations manager of procurement at E2open, highlighted the complex factors at play in re-balancing the trucking market. “We are completely balanced right now in the market,” Faunce said. He noted that the closure of Yellow in July, which shed 34,000 jobs, has contributed to the adjustments in supply. “If you look back at market intelligence reports, it looks like that between July and August, we shed about 37,000 jobs.”

Another critical factor, according to Faunce, is the entry of new drivers who obtained their commercial driver licenses during the pandemic. While retail sales growth and continued volumes from regions like Asia and South America have contributed to steady demand, he expects significant rate adjustments in the near future.

“As carriers have been reducing the number of trucks in their fleets, large and small, and carriers have been exiting the market, they’ve been chasing this elusive demand that’s been moving sideways,” observed Dean Croke, principal analyst at DAT Freight & Analytics. “It’s been like a moving target all year where capacity’s been trying to rebalance itself to where demand is, but demand has been really elusive.”

Croke attributed this uncertainty to factors such as high interest rates, shifts in consumer spending, and decreased home construction. However, he noted that some positive signs are emerging, including returning seasonality and improved market predictability. Year-over-year rates also began to edge upward in October.

“Even in November, we’ll lose another 7,000 carriers,” Croke added. “We’ve been averaging about 7,000 carriers exiting the market all year, every month. And that just speaks to this massive influx that came in 2021 and 2022. And by my accounts of the 480,000 carriers that have joined since June of 2020, 18% are still active in the market, and that’s extraordinary.”

Source: Transport Topics

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