Shippers have navigated the first half of 2018 in a market of tight freight capacity -- low truck supply and high demand due to factors like the driver shortage.
We checked in with LeanCor Transportation Manager Steven Prince to review current market conditions and hear the transportation team's take on what to expect going forward.
How do you see the market performing for the remainder of 2018?
I anticipate that the market will loosen and prices will drop by the end of 2018 due to both seasonal factors and historical trends. The market has never sustained such high demand and tight supply of trucks and drivers. More trucks and drivers are entering the marketplace daily and have been for several months now to capitalize on the higher rates. Class 8 sales (new trucks) are strong. If carriers had so many empty trucks sitting around without drivers, class 8 sales would be less bullish.
When could this likely happen?
The only question is timing. If we have peaked, expect the market to loosen by the end of Q3. If we are still peaking, expect the market to loosen in time for Q1 2019. Every time in the last 20 years the index has peaked, we’ve seen a sharp decline (typically coming out of Q2).
What would prevent the market from loosening?
For the market to sustain current levels, it would take something historic and not just a typical economic boom and shortage of trucks and drivers.
What are carriers, shippers, and brokers saying?
As part of its bi-weekly Truckload Sentiment Survey, Morgan Stanley has carriers, shippers, and brokers provide commentary on what they're experiencing with the current market:
More Industry News:
- Industry Experts: Trucking Booms, but Keep an Eye on Trade Policy
- Trucking Industry Adjusts to ELD Mandate as Focus on HOS Compliance Sharpens
- May Class 8 Sales Climb 18.1%; Analysts Expected More
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