TRANSPORTATION TRENDS: 2-20-23

A potential acquisition discovered in the Less-than-Truckload market between two key players. Truckload owner-operators are seeing a double whammy with lower volumes and higher operating costs.

Truckload:

A FreightWaves survey showed that 35.2% of Owner-Operators interviewed are considering leaving the industry at the end of the year if conditions don’t change. While the average Owner-Operator, that was surveyed, showed a 7% revenue growth from 2021-2022, operating expenses were up 22.9% more in 2022. Lower volumes in the market are a troubling sign for these Owner-Operators who are incurring more expenses.

According to DAT, spot postings were down 2.4% and truck posts were down 4.6% week-over-week (Week of Feb 13 versus the week of Feb 6). This shows that the market was a bit tighter in the last week, which would showcase the rise in dry van and flatbed load-to-truck ratios. Refrigerated equipment was the only equipment to show a decrease in load-to-truck ratios from the previous week. However, that can be explained by the uptick in refrigerated equipment needed the week before Valentine’s Day to move floral loads. 

Less-Than-Truckload:

An announcement was made last week that TFI International Inc (T-Force/UPS Freight’s parent company) is holding a 4% stake in ArcBest Corp (ABF Freight’s parent company). Experts are speculating that this $89 million investment into ArcBest Corp is foreshadowing a later acquisition of the company by TFI International. This is something to keep an eye on, however, this is just speculation from experts based on the stake TFI International holds in ArcBest Corp.

From TLI’s recent conversations with LTL carriers, there appears to be a consensus of increased investment in expanding operations/terminals from LTL carriers. While year-over-year volumes have dropped 2-5%, revenues are still higher and expect to remain this way in the first 2 quarters with a steady rise in the last 2 quarters of 2023. This is due to the heavy investments being made to their networks. 

TLI is actively monitoring situations in the industry, such as acquisitions, embargos, and other industry disruptions. If a TLI client is directly affected by any of these events, your TLI representatives will reach out to discuss what this means for your account.

TLI highly suggests that on all shipments you provide our team with the “Must Arrive by Date” (MABD) as to when you need the product delivered. This will help us select the proper transit time / equipment type at the best current freight rate.

Please contact your Translogistics team at 610-280-3210 for any further questions. 

*article written by Mitchell Kinek, Sales/Marketing Executive, Translogistics. Any questions, please do not hesitate to reach out!

The chart above depicts national average line haul rates and fuel surcharges for equipment in the past 4 months, from DAT.