Truckload freight rates are still high as we head into 2021. Many factors continue to impact truckload freight rates—from decreased equipment capacity and a scarcity of qualified drivers to small-company truckload bankruptcies and rising insurance premiums. Even truckload freight spot rates are about 30% higher than they were a year ago.
So, what can the truckload industry expect as we attempt to budget and move truckload freight in the year ahead?
- Truckload freight remains part of a very dynamic larger freight hauling continuum. Both less-than-truckload and truckload carriers are in direct competition with short-haul and e-commerce freight companies for scarce drivers.
- Truckload freight rates may change again, and smaller shipments could start to move towards truckload. The 2020 disruption in the small package market may mean that shipments are redirected to the less-than-truckload market while some freight will divert to the truckload market. Also, ongoing issues in the international and intermodal markets may mean more shipments move to truckload.
- Truckload freight rates will likely increase 3-5% for shippers who contract with truckload carriers. SunSet Transportation expects an increase of 5-7% in truckload freight rates and a 3-4% increase in fuel rates.
- Some national truckload carriers are seeking a more regional presence. To lure new drivers and revamp long-haul networks, a few national carriers are growing their regional presence. In addition, some carriers are looking to diversify their lane mix to mediate COVID-19 disruptions.
- More truckload carriers and shippers are using data and collaborative tools. Tools like a transportation management system enable better planning and efficiency and help shippers and truckload carriers mutually enhance their business relationships—a wise move for uncertain times.
- Some shippers are moving towards becoming shippers of choice. This strategic move helps shippers partner more closely with truckload carriers to move their truckload freight. It can also help expedite freight by providing longer lead-times and flexibility on pickup times for more efficient route planning.
Truckload freight rates will eventually rebalance.
Uncertain times call for stronger alliances and better tools. Truckload freight rates will eventually rebalance throughout 2021 and into 2022. But it’s a good time now to optimize your operation. Using Axele TMS helps you find optimal loads that lead to an increase in your bottom-line profits. Contact us for more information.