Q3 2024 freight market update: Key insights and recommendations for shippers and carriers

Updated August 7, 2024

Heading into the second half of the year, the freight market has largely stabilized, while supply and demand remained consistent with previous months. 

Even in a soft market, logistics teams should always be prepared for a potential market turn later in the year. The key to staying ahead of disruption and remaining competitive is to build and maintain a proactive, data-driven logistics program. Our latest Quarterly Market Update and Outlook Report shares data and insights from our experts around the impacts of leading economic and supply chain trends, helping logistics teams stay informed and prepared for potential volatility. 

For Q3, we spotlight insights around supply and demand, and route guide performance in the U.S. truckload sector; the latest LTL market trends; and key factors impacting cross-border transportation. 

U.S. trucking: Supply and demand remains the same; and routing guide performance is still robust

Supply and demand barely changed in Q2, remaining 1.2% higher year-over-year. This growth is likely due to a 2.3% year-over-year increase in real consumer spending on goods and a 10.4% year-over-year increase on containerized imports. While long-distance truckload employment decreased slightly compared to 2023, the overall supply only fell 0.3% year-over-year thanks to higher-than-anticipated sales of Class 8 trucks.

Despite seasonal tightness from annual events including produce season, routing guide compliance remained robust. First tender acceptance rates fell slightly to 92% in June, just shy of record highs, while compliance remained strong at 94%.​ These numbers suggest that most spot volume on the market is intentional or attributable to one-off shipments. Additionally, tender rejections impose minimal extra cost on shippers compared to their primary carrier, providing further protection against route guide disruptions.

Our recommendations:

• Maintain high FTA by establishing strategic relationships with key providers in your network, as well as symbiotic, long-term goals. 
• To navigate volatility, collaborate with strategic carriers for cost and price transparency within your network, create an action plan to address out-of-process lanes.

LTL market sees slow and steady rebound 

Coming off of Yellow’s exit from the market last year, the LTL space is showing signs of positive momentum. Demand for LTL services is lower than last year and tonnage growth is still negative. However, volume is expected to grow throughout 2024 with a full rebound forecasted for early 2025.

Carrier margins are trending high in the LTL space, with carriers also investing heavily in facilities, technology, and process improvements to stay on par with the top performers in that market. Overall, carriers are targeting growth and yield to drive performance, while heavy bid activity is providing them with numerous choices to improve or grow their networks.

Our recommendations:

• Carriers are seeking strategic growth partners with a high degree of tech enablement to help drive cost-out initiatives. Tools like Uber Freight’s LTL solution help shippers and carriers streamline the LTL procurement process. 
• Continue to prioritize best practices for long-term success, which include productive carrier collaboration, data-driven pricing strategies, and packaging improvements. 

Cross-border shipping: Opportunities to improve Mexican and Canadian operations

There’s ample opportunity to optimize shipping South and North of the border. But shippers must be aware of the latest trends impacting transportation in Mexico and Canada. 

In Mexico, transload capacity for northbound loads has tightened due to high demand, while carriers continue to include empty miles within their linehaul rates to keep up with that demand and reposition equipment from the border to the shipping points in Mexico. Cargo theft and driver shortages also remain the most pressing challenges for Mexico’s transportation industry. 

In Canada, trucking activity has marginally improved since Q1, with excess capacity slowly being absorbed by the market. According to the latest Trucking HR Canada (THRC) national job vacancy update, driver job vacancies declined 33% year-over-year. Meanwhile, Ontario truck border crossings have increased 5% from Q1 to Q2, while the number of truck crossings decreased 1.4% year-over-year in Q2. On the spot market side, volumes have also increased 18% year-over-year. 

Our recommendations:

• To successfully navigate the Canadian market, be sure to issue full network RFPs and secure capacity at current rates as the market starts to re-balance​.
• Seek to implement network efficiencies with technology solutions. For example, Uber Freight’s Canadian LTL services move more than 10,000 pallets out of the Greater Toronto Area per week. Leveraging an innovative collaborative shipping model, it combines shipments from multiple shippers into optimized, multi-stop routes, reducing unnecessary stops and costs while improving overall shipment performance.
• Prioritize fighting cargo theft in Mexico with fraud prevention solutions including real-time shipment tracking to catch suspicious activity.

These are just a few of the findings from our new report. For a comprehensive outlook of what logistics teams can expect this quarter, including an overview of global supply chain events, see our full Q3 Market Update and Outlook Report.

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July 2024 freight market update: Key insights

Updated April 24, 2024

Amid slowing inflation, the unemployment rate jumped to 4.1%, its highest level since November 2021. A rise in unemployment could suggest a recession is on the way. The good news is that truckload demand has recently seen some positive growth, rising 0.5% in May following growth in consumer spending, wholesale activity, and manufacturing output.

The outlook for shippers is par for the course. Companies are experiencing the seasonal pressures that typically impact Southern produce markets, where rates this month have been as much as 10% higher than the rest of the year. However, over the next two months we expect these markets to soften while Northern markets tighten. Meanwhile, carriers are experiencing tighter profit margins due to a rise in empty miles traveled paired with declining rates.

Read the detailed report here.

*All data is generated by Uber Freight internal indices using a weighted combination of truck and driver availability for supply, and manufacturing output, goods consumption, imports and exports for demand.