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ACT Research Freight Forecast: TL Contract Rates Turn Lower with More to Go

Posted by Jennifer McNealy on Nov 11, 2019 4:00:00 PM

ACT Research released the November installment of the ACT Freight Forecast, U.S. Rate and Volume OUTLOOK report covering the truckload, intermodal, LTL and last mile sectors.

The ACT Freight Forecast provides three-year forecasts for volumes and contract rates for the truckload, less-than-truckload and intermodal segments of the transportation industry, and for the truckload spot market, the report forecasts the next twelve months. The Freight Forecast provides unmatched detail on the future of freight rates, helping businesses across the supply chain plan for the future with confidence.

Truckload Rate Gauge 11-11-19Based on ACT’s For-Hire TL Carrier Database, TL contract rates fell to $2.28 per mile in Q3, down 2% y/y, following a 3% increase in Q2.

Tim Denoyer, ACT Research’s Vice President and Senior Analyst, said, “We’re seeing evidence that a bottoming process is beginning in the truckload cycle from truck order and survey data. It will be gradual, but we think spot rates will turn positive in mid-2020. Meanwhile, for-hire freight volume continues to be soft, pressured by ongoing private fleet capacity additions, so we don’t think we’ve seen the worst of the contract rate pressure yet.”

He continued, “We caution not to jump to the conclusion that capacity is tightening because of carrier failures. Those are not unusual in this business and the fact is US fleets bought more new Class 8 tractors in September than any month in history. So, capacity is not yet tightening, and build plans are still above replacement for the next six months. Rather, roughly 10k net new tractors were added to US highways in September, mainly by private fleets.”

Freight - Rail Volumes Table 11-11-19Freight has softened since the September 1st tariff imposition, due in part to the temporary strike at GM, and declines have broadened to every major rail category except petroleum. As GM ramps production back up, the major declines in Q4 to-date rail volumes should moderate somewhat.

ACT Research is recognized as the leading publisher of commercial vehicle truck, trailer, and bus

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 industry data, market analysis and forecasts for the North America and China markets. ACT’s analytical services are used by all major North American truck and trailer manufacturers and their suppliers, as well as banking and investment companies. ACT Research is a contributor to the Blue Chip Economic Indicators and a member of the Wall Street Journal Economic Forecast Panel. ACT Research executives have received peer recognition, including election to the Board of Directors of the National Association for Business Economics, appointment as Consulting Economist to the National Private Truck Council, and the Lawrence R. Klein Award for Blue Chip Economic Indicators’ Most Accurate Economic Forecast over a four-year period. ACT Research senior staff members have earned accolades including Chicago Federal Reserve Automotive Outlook Symposium Best Overall Forecast, Wall Street Journal Top Economic Outlook, and USA Today Top 10 Economic Forecasters. More information can be found at www.actresearch.net.

Freight Forecast 11.11ACT’s 62nd seminar is scheduled for February 11-13, 2020, and will feature trucker, electrification, and economic panels, as well as discussions on near-term demand of North American commercial vehicle markets and the pending impact of electrification on the market in the near future. A commercial vehicle database workshop is also being planned in conjunction with this semi-annual event. Click here for seminar information.

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Access more information about ACT’s Freight Forecast, U.S. Rate and Volume OUTLOOK, please click here.

Access information about ACT’s freight-related databases.

See October's Freight Forecast Report Press Release 

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Topics: freight, freight forecast, freight rate, transportation, logistics, Press Releases, supply chain, truck freight, north american trucking, commercial truck and trailer, transportation industry news, trucking, intermodal, truck freight rates, demand planning, us freight, commercial freight shipping, last mile delivery, freight rates

About ACT Research

We're the leading publisher of industry data, market analysis, and economic forecasting services for the commercial vehicle and transportation industries.

2019 Lawrence R. Klein Award Winner: Most Accurate Economic Forecast 2015-2019

  Partner to LMC Automotive and the Chinese State Information Center

  Contributor to the Blue Chip Financial and Wall Street Journal Consensus Economic Forecast


 

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