Chart of the Week: Carrier Details Total Trucking Authorities, Outbound Tender Volume Index Monthly – USA SONAR: CDTTA.USA, OTVIMTH.USA
Monthly truckload tender volumes for September were 16% higher than September of 2018. The number of carrier operating authorities reported by Carrier Details using FMCSA data has risen 49% over the same period.
The extraordinary excess of capacity is what is driving the current freight market conditions and as the chart suggests, capacity changes are very slow in relation to demand. Transportation service providers are forced into a waiting game of survival until it ends. While it may not seem like it, the tide is already turning.
Strangely, the pandemic was indirectly responsible for overstimulating the global economy. Government stimulus packages and increased time at home created the perfect storm of consumption of goods while travel and leisure services faltered.
In 2022, this trend reversed with violent force, a consummate example of an economic bubble manifesting in durable goods purchases. Not all have felt the shift equally, but the aggregate U.S. economy has certainly cooled since then.
None have felt that cooling more than transportation service providers, which have been dealing with challenging conditions since early 2022, when demand eroded rapidly. Some of the volume has recovered, but not nearly enough to support the existing capacity.
