Surface Transportation

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Slow growth predicted for US economy , freight demand in 2025

By Cathy Morrow Roberson and William B . Cassidy

US freight and economic outlook . S & P Global is the parent company of the Journal of Commerce .

Rising unemployment and consumer debt may dampen spending , but Bingham and other speakers said they expect a better market for carriers , with rates rising in the truckload , intermodal and less-than-truckload ( LTL ) markets .

“ We ’ ve been surprised by the resiliency of the consumer this year , but it ’ s not sustainable .”

US economic growth will slow in 2025 , and the surface freight market will remain soft after a “ soft landing ” for the economy , speakers said at the Journal of Commerce Inland Distribution Conference 2024 ( Inland24 ) in early October .

“ We ’ ve been surprised by the resiliency of the consumer this year , but it ’ s not sustainable ,” Paul Bingham , director of global intelligence and analytics for S & P Global Market Intelligence , said during a panel discussion on the

Truckload pricing is forecast to rise by low- to midsingle-digit percentages , said Lee Klaskow , senior analyst of logistics at Bloomberg Intelligence .

“ I would say that 2025 will be better ,” for motor carriers , Klaskow said , adding that excess capacity in the truckload market is delaying any meaningful rate increases until later next year , when the demand picture could improve .

US truckload carriers pushing first rate hike in two years in 2025

Inland24 speakers predicted singledigit contract truckload and LTL rate increases in 2025 . Shutterstock . com

By William B . Cassidy

There ’ s no quick recovery ahead for the US truckload sector , either in terms of pricing or demand , executives from several logistics companies said at the Journal of Commerce Inland Distribution Conference 2024 ( Inland24 ).

“ I hear a lot about optimism for the truckload market for 2025 , but I can ’ t find it yet in our numbers ,” said Kendra Tucker , CEO of Truckstop . com , a freight marketplace and technology platform .

Still , truckload carriers are expecting rates to rise in 2025 after two straight years of declines . Executives at the Inland24 conference forecast annualized contract rate increases in the mid-single-digit percentage range .

Spot truckload rates , however , are still bouncing along the bottom they hit in mid-2023 , increasing only slightly over year-ago levels , according to data from load-board operators Truckstop . com and DAT Freight & Analytics and third-party logistics operators .

“ Typically , the spot market leads the rest of the market ,” Tucker said , with contract rates following rising short-term pricing . But to date , “ it has not been there ,” she said .

Excess capacity has been an anchor on spot truckload rates , Tucker said .

“ Small truckers are really hanging on ,” she said . “ I don ’ t know if they made a whole bunch of money in 2021 and 2022 or learned to handle multiple gigs at once , but they are very resilient .”

Despite a slight spike in December 2023 , national average dry-van truckload spot rates have remained in a relatively narrow range of $ 1.52 per mile to $ 1.74 per mile over the last 12 months , according to DAT Freight & Analytics . In the week that ended Sept . 27 , total broker-posted

40 Journal of Commerce | October 21 , 2024 www . joc . com