This article was originally published on PR Newswire.
BOISE, Idaho, Aug. 9, 2022 /PRNewswire/ — Recession and inflation concerns are weighing on the profitability of carriers in the spot market, according to the latest Bloomberg Intelligence | Truckstop survey of owner operators. The outlook for volume and growth has been less optimistic over the past three months but shows a rebalancing of the owner-operator market.
“Spot rates have been extremely volatile over the past 12 months and bullishness has started to wane among carriers,” said Lee Klaskow, senior freight transportation and logistics analyst at Bloomberg Intelligence. “But we believe current conditions will force a balancing in the market and lead to rate stabilization.”
The Bloomberg | Truckstop 2Q22 Truckload Survey shows:
- Volatility weighing on owner-operators’ psyche: About 53% of respondents expect load growth over the next six months vs. 73% in 1Q and 64% in 2Q21. Flatbed carriers were most optimistic (57% expect higher volume), followed by dry van (53%). Carriers expressed increased demand concerns over inflation, especially the impact of surging fuel prices on consumers. Not all were gloomy, with many noting demand felt “normal” after the unsustainable peaks last year.
- Carriers become bears on spot rates: Spot rates excluding fuel surcharges have fallen 21% since peaking in late December, which has weighed on sentiment. Only 43% of carriers expect the rates to rise in the next six months, the lowest level since 1Q20. About 25% of carriers expect a drop over the next 3-6 months.
- Carriers pumping the brakes on demand: Total demand softened in 2Q22 among truckload carriers, with 62% of respondents noticing the drop from 1Q and about 47% saying volume growth was down from the same time last year. About 84% of carriers who focused on dry-van loads saw volume declines from 2Q21, followed by reefer (77%) and diversified (41%).
- Carriers are feeling the full brunt of higher fuel costs: 96% of carriers citing fuel costs as the biggest inflationary pressure affecting the profitability of their businesses. About 81% of our respondents believe they will continue to face inflationary pressures for the next six months.
“We know that fuel costs and inflation concerns weigh on the profitability of carriers operating in the spot market,” said Kendra Tucker, chief executive officer, Truckstop. “That is exactly why we continue to provide customers with mission-critical software that keeps their business moving forward and profitable, even in a down spot market.”
The Bloomberg | Truckstop survey of owner-operators and small fleets provides timely channel checks into the health of the spot market. The sample size was 140, consists of dry-van, flatbed, temperature-controlled and specialized/diversified carriers. Of the respondents, 65% operate just one tractor.
The complete survey is available to Bloomberg Terminal subscribers via BI.
Truckstop is a trusted partner for carriers, brokers and shippers – empowering the freight community through a platform of innovative solutions for the entire freight lifecycle to increase efficiency, automate processes, and accelerate growth. As one of the industry’s largest neutral freight marketplaces, Truckstop provides the customer service as well as scale of quality loads and trucks to give customers of all sizes, whether on the road or in the office, the transparency and freedom to build lasting relationships and grow their businesses. To learn how Truckstop is helping move the freight community forward, visit www.truckstop.com.