In most market categories, consumer spending is down compared with the past two years. This has resulted in a drop in demand for freight services. As a result, carriers are gradually leaving the market. With the influx of new entrants in the past few years, it is taking time to align the oversaturated carrier market with the decreased demand.
In Q3 2023, spot rates have seen a year-over-year decrease of 9.9%. But they are on their way up. For freight carriers, it is critical to have visibility into internal and external datasets and to engage in proper planning. This foresight will help you navigate the market as it approaches inflationary territory and ensure your success in the industry.
While spot rates are slowly increasing and contract rates are following suit, we want to highlight that there hasn’t been a significant event to accelerate these rate increases since the CVSA International Road Check and Memorial Day. Barring any unexpected events, such as severe weather conditions or disruptions, we anticipate that normal seasonality and capacity attrition will be the primary driver of the freight market through Q3 2023 and into Q4 2023.
As you prepare for the upcoming peak season and national holidays, keep a close eye on how these factors will impact freight volume and rates. Being aware of these trends and planning accordingly will be crucial for your success as freight carriers. Stay informed, adapt to the changes, and make the most of the opportunities that come your way in the ever-evolving freight market.
Interested in diving into the details? Read our comprehensive report in the Transportation Outlook.