Surface Transportation

Knight-Swift is the largest US truckload service provider and owns , among other carriers , Swift Transportation , Knight Transportation and U . S . Xpress Enterprises .

In an on-stage interview , Miller said he agreed with a forecast for low- to mid-single-digit percentage increases in truckload contract rates in early 2025 .

“ I don ’ t see us getting double-digits , but we could go to mid-single-digit increases ,” he said . “ I think we ’ ll be positioned for a rate season where rates go up mid-single digits and build from there ” over the course of the year .

“ It would be the reverse of what happened in 2023 ,” when rates dropped throughout the first half , Miller noted .

Jim Filter , group president of transportation and logistics for Schneider National , said the truckload market “ is a little closer to equilibrium than people believe , because we ’ re seeing signs of seasonality . Perhaps not an inflection , but at least seasonality .”

Storm warnings

Damage from Hurricane Helene could accelerate a pricing inflection , speakers and attendees at Inland24 said .

Hurricane Helene made landfall in Florida Sept . 26 and caused massive damage across several states as far north as North Carolina .

“ You are already seeing an impact on out-of-route miles ,” said Drew Wilkerson , CEO of logistics provider RXO .

North American truckload carriers , who saw revenue on average drop a projected 4.6 % this year will see their top line rise 7.2 % in 2025 , propelled by higher rates , Lee Klaskow , senior analyst for logistics at Bloomberg Intelligence said at Inland24 .

Less-than-truckload ( LTL ) carriers will fare even better . LTL revenues dropped an average of 6.3 % in 2023 but will rise 4.9 % in 2024 and 7.6 % next year , Klaskow said .

LTL executives at Inland24 said they expect rates to rise by mid-single-digit percentages in 2025 , with LTL capacity still at lower levels than in 2023 , before Yellow ’ s sudden market exit .

email : bill . cassidy @ spglobal . com

US truckload spot rates flatline through September

Average US truckload spot rates , in USD per mile , excluding fuel surcharges

USD average rate per mile

$ 2.4 $ 2.2 $ 2.0 $ 1.0 1.8 $ 1.6 $ 1.4 $ 1.3 1.2

$ 1.0 L

Source : DAT Solutions

Jan 2023 Jul

Jan 2024 Dry Van Flatbed Refrigerated

Mar , 2024Jul

© 2024 S & P Global

L

Domestic intermodal rate pressure building on stronger truck pricing

By Ari Ashe

Intermodal executives warned domestic rail shippers to anticipate paying more in 2025 contracts . However , rates should only rise by low-single-digit percentages across the US , executives said during the Journal of Commerce Inland Distribution Conference 2024 ( Inland24 ).

Adam Miller , CEO of Knight-Swift Transportation , the largest US trucking company and fourth-largest domestic intermodal provider , said intermodal contract rates largely depend on the movement of truckload contracts because rail must offer a discount to trucking to maintain share .

He expects national average truckload rates in contracts signed and implemented in the first quarter of 2025 to climb between 1 % and 6 % from current levels .

“ If there are low- to mid-single-digit increases in truckload , I think intermodal would be something similar ; it would follow ,” Miller told Inland24 . “ It might take a little bit more time for those intermodal rates to bear out , but we ’ d expect the rates to move in a similar direction .”

Phil Yeager , CEO of Hub Group , the second-largest domestic intermodal provider , agreed .

“ If you ’ re an incumbent , I think [ Miller ’ s range ] is the proper framework ” for bids going live in the first quarter , he said .

However , Gary Ahlstrom , vice president of pricing for fifth-largest domestic provider STG Logistics , warned that it also matters when the shipper launches the bid . Early bids might be approximately in line with the cost of inflation nationally — i . e ., about 2 % to 3 %.

“ The bids in April and May might be a little higher than the first quarter because [ those shippers ] got lower rates [ in 2024 ],” he said .

Average US contract intermodal rates fell to $ 1.49 per mile in August from $ 1.58 per mile in the same month last year , while truckload rates slipped to $ 1.97 per mile from $ 2.09 per mile in August 2023 , according to the Journal of Commerce Intermodal Savings Index ( ISI ).

Above-average performance

One region where intermodal contracts could go up more than the national average is Southern California in the Southwest US .

Total domestic container volume grew 5 % year over year in the three months ending in August , according to the Intermodal Association of North America ( IANA ). The growth rate will likely remain about the same on a rolling

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