The effects of the highest tariffs since the 1930s on the freight market are significant, as discussed in the latest release of the Freight Forecast: Rate and Volume OUTLOOK report.
“Tariff impacts will be limited by the 75%-80% of freight already made and consumed domestically, but the impacts on international trade have been and will continue to be significant,” according to Tim Denoyer, ACT Research’s Vice President and Senior Analyst. “Uncertainty may be starting to decline, but after pre-tariff inventory building in the first half, the paybacks from these pull-forwards will likely start soon, leading to a short and soft peak season.”
“The trucking market has shown notable softness since Roadcheck in mid-May, with rate trends sliding and a brief jump in demand in early July already fading and freeing up capacity.
“Capacity remained available even through the strongest seasonality of the year, partly because Class 8 tractor sales moved higher in Q2, counter to order trends, as the last pre-tariff vehicles were snapped up.
“While freight demand headwinds remain, equipment sales are likely to decline as tariffs have begun. Soft used tractor day cab prices also suggest private fleets are starting to reverse course, suggesting tighter capacity ahead.
“Our Driver Availability Index started to tighten this month for the first time in over three years as well, and these supply factors should limit the downside for freight rates,” Denoyer concluded.
Freight Forecast Report Overview
The monthly 61-page ACT Freight Forecast report provides analysis and forecasts for a broad range of U.S. freight measures, including the Cass Freight Index, Cass Truckload Linehaul Index, and DAT spot and contract rates by trailer type for the U.S. and Canada. The service provides monthly, quarterly, and annual predictions for the TL, LTL, and intermodal markets over a two- to three-year time horizon, including capacity, volumes, and rates. The Freight Forecast provides unmatched detail on the freight rate outlook, helping companies across the supply chain plan with greater visibility and less uncertainty.
ACT Research Overview
ACT Research is recognized as the leading publisher of commercial vehicle truck, trailer, and bus industry data, market analysis and forecasts for the North America and China markets. ACT’s analytical services are used by all major North American truck and trailer manufacturers and their suppliers, as well as banking and investment companies. ACT Research is a contributor to the Blue Chip Economic Indicators and a member of the Wall Street Journal Economic Forecast Panel. ACT Research executives have received peer recognition, including election to the Board of Directors of the National Association for Business Economics, appointment as Consulting Economist to the National Private Truck Council, and the Lawrence R. Klein Award for Blue Chip Economic Indicators’ Most Accurate Economic Forecast over a four-year period. ACT Research senior staff members have earned accolades including Chicago Federal Reserve Automotive Outlook Symposium Best Overall Forecast, Wall Street Journal Top Economic Outlook, and USA Today Top 10 Economic Forecasters. More information can be found at www.actresearch.net.
Tim Denoyer, VP & Senior Analyst
ACT Research
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