Truckload rates to drop 2-4% in 2009
Truckload capacity could see major reductions this year.
By Dave Hannon -- Purchasing, 1/16/2009 11:59:00 AM
A recent report from analyst Thomas Albrecht at Stephens Inc. forecasts that truckload rates will drop 2-4% this year, although Albrecht warns that at this point in the year, forecasting is very difficult.
“Some lanes could be discounted 10-20% while selected despearate carriers might be willing to cut rates15% or more on entire bid packages,” he says.
But the bad news for freight buyers is that more carriers may disappear this year, as the economic downturn continues to cut trucking carriers’ revenues and profits, making them candidates for bankruptcy or takeover. Albrecht estimates that truckload capacity will be reduced by 0.5-1.0% per month from April onward.
“As difficult as it is to believe now, we estimate that dry van supply could be close to equilibrium by late 2009,” he says.
The one positive for truckers to come out of the demand decline is the supply of drivers. What used to be a major concern, especially for longhaul truckload carriers, is no longer an issue. “There's a huge oversupply of drivers now,” said Joe Rajkovacz, regulatory affairs specialist for the Owner-Operator Independent Drivers Association, in a recent story in the Milwaukee Journal Sentinel.
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