Welcome to the week of May 8th edition of the Transfix Take! Gear up for the latest updates and trends in the trucking industry. In this issue, we're revving up with industry news, sprinting through regional breakdown highlights, and putting the spotlight on what's on the logistics horizon.
In this week's edition of Transfix Take, we bring you the latest updates and insights from the world of freight. Co-hosts Justin Maze and Jenni Ruiz share the following highlights and updates:
Preparing for the Blitz: This week, as we approach DOT Blitz Week, the market is poised for some volatility, reminiscent of last year's activity. Tractor protection systems and alcohol/substance protection will be the main focus areas for spot inspections during the upcoming week, likely leading to fluctuations in rates and tender rejections nationwide.
Last week, the national average rate per mile saw a slight increase towards the weekend at $1.62/line haul only, primarily driven by produce areas in Southern California, Florida, and Georgia. Texas also saw tightened capacity in major hubs like Houston and Dallas-Fort Worth, affecting rates in the southern region. However, going into this week, rates are expected to stabilize or even dip, with anticipation of tightening towards the weekend. Tender rejections are at 3.14% but anticipate these changes to spike significantly toward the end of the week.
Source: Freightwaves
Source: Freightwaves
Below is a regional breakdown of the freight industry, uncovering nuances and trends in various regions across the nation.
Midwest: Continues its downward trend, with about 90% of markets witnessing decreases. Notably, markets like Charleston, West Virginia, Evansville and Indianapolis, Indiana, and Louisville, Kentucky, maintained gains. Expectations are for the downward trend to persist until next week, albeit with less volatility compared to other regions.
Northeast: Saw slight gains in short hauls but remains unattractive for carriers, with notable loosening in high-volume markets like Harrisburg and Philadelphia, while tightening is observed in Elizabeth, New Jersey, primarily in shorter local runs. Rates are expected to continue declining, affecting outbound rates to the Southeast.
Coastal Region: Experiencing gains across all lengths of haul, particularly driven by freight heading to the Northeast and Midwest. Rates are anticipated to rise further, intensifying the upward trend.
West Coast: Despite a slight quieting down, there's an overall 1% increase in the last 60 days, typical for this season. However, the impending DOT Blitz Week is expected to spark intensification in capacity tightening and rate increases, especially in high-volume markets like Phoenix and Southern California.
South: This region continues to experience the peaks and valleys it normally would due to seasonality but one major callout is that high-volume markets Dallas, Fort Worth, and Houston all experienced a pretty noticeable tightening. If this tightening doesn't ease at the beginning of this week, then we could see the outcome of the average rate in the South change over the next two weeks. But if we do start experiencing some looseness in these higher volume markets, then we’ll be back on pace to mirror where we were last week.
Southeast: Emerges as the hottest region, witnessing significant increases across all lengths of haul, with rates steadily rising. This trend is expected to continue and intensify, with capacity being pulled from neighboring markets, especially during DOT week.
In reflecting on last year's DOT Blitz Week amidst a soft freight market, we observed a notable 12% increase in rates and a temporary uptick in tender rejections. This surge in rates persisted post-Memorial Day through the 4th of July, signaling a potential shift in market dynamics. With rates already persistently low for an extended period, there's cautious optimism regarding the potential for carriers to maintain momentum post-inspection blitz. Here are some quick facts:
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