Welcome to the WHAT THE TRUCK?!? Newsletter presented by Tai Software. In this issue, trucking rates hit two-year highs; tariffs spook shippers and consumers; Houthi conferences; and more.
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Up and to the right
Out like a lion — Momentum has been building up in trucking markets during the fourth quarter, and now top lanes are starting to feel the squeeze.
FreightWaves’ Craig Fuller reports, “The SONAR National Truckload Index (NTI) is showing some numbers we haven’t seen in almost two years. We’re talking $2.53 per mile! The last time rates were this high was back in January 2023. Truckload spot rates are up 34 cents a mile since Oct. 1, 2024, a 15% increase.”
“In the past week, we’ve seen spot rates jump from $2.38 to $2.53 a mile, a 15-cent increase.” – FreightWaves’ Craig Fuller
Here’s the interesting thing: Despite rates being up, volumes are down. How can that be? Attrition. You know how for the past two and a half years we talked about the capacity glut in the market? Enough has finally burned off that we’re seeing some leverage restored to carriers. In fact, there are 4% fewer carriers now than there were at this time last year.
Pulling ahead
Tariffs spook shippers and consumers – For the near future at least, expect freight flows to continue building up. Earlier in the year, we saw a massive pull forward of containers into the West Coast to avoid the potential International Longshoremen’s Association strike.
While that strike ended quickly in October, it was really only postponed until Jan. 15. That’s the deadline for the ILA and the United States Maritime Alliance (USMX) to talk about their real issue: automation. In addition, once it became clear that Donald Trump might win the election, shippers began to react to his tariff proposals.
According to a December report by CreditCards.com, shippers aren’t the only ones trying to duck Trump’s tariffs.
– Thirty percent of shoppers will make more purchases than usual this holiday season.
– The top motivation for increased spending is fear of rising prices due to Trump’s tariffs.
– Twenty-two percent of Americans plan to make a large purchase before the end of the year, and many are motivated to buy ahead of Trump’s tariffs.
– Thirty-four percent of respondents say they are “doom spending” and stockpiling items due to feeling fearful or uncertain about the future.
– Thirty percent are likely to go into or worsen debt to secure purchases now.
“So today was just as big as Cyber Monday. Interesting consumer behavior” – Matt Schroeder, co-founder at Tidalwave 3PL
E-commerce service providers are seeing a ton of that activity as sales volumes continue to boom during the holiday shopping season. While consumers are concerned about tariffs, should they be more concerned with the potential ILA strike on Jan. 15?
President-elect Trump has been trying to get ahead of the port strike situation with a few posts on his social media platform Truth Social.
FreightWaves reports: “On Saturday, Trump reposted … a Facebook message by Dennis Daggett, International Longshoremen’s Association executive vice president, praising Trump for his support of the union in its protracted contract fight with employers at Eastern Seaboard and Gulf Coast container ports.”
Last Thursday, Trump met with Daggett and reiterated his support for the ILA. With the presidential inauguration just five days after the ILA/USMX contract deadline, the “Home Alone 2” star is unlikely to want a distraction like this taking away from his big day. But will he want to swoop in and play hero?
After Trump announced his support for the ILA, the Polymarket port strike betting odds fell from over 50% down to 40%. However, how does the USMX feel about all this?
The brilliant Sal Mercogliano brings up an excellent point. While the ILA and Trump may want a deal, the shipping lines that represent the USMX know that shipping chaos equals cash. They stand to make bank on trans-Pacific rates should U.S. ports become congested due to shutdowns from Maine to Texas.
As if there wasn’t enough going on at sea, Houthi rebels have been attacking commercial shipping vessels for the past 395 days.
TradeWinds reports, “The Houthi rebel group, responsible for launching dozens of attacks on commercial vessels and the deaths of four seafarers in the last year, is planning a seminar and webinar on ‘security of navigation in the Red Sea’ — and it wants some ideas.”
Do you have any ideas for the Houthis? Should they do fireside chats or panels? What are the networking opportunities, and is a band playing the reception? First conferences can be tough. What do you give away as swag at such an event?
Wednesday on WHAT THE TRUCK?!?, we’ll go deep on all of these issues with Flexport’s Ryan Petersen.
Plus, all the latest headlines, trends and viral weirdness since our last show.
Catch new shows live at noon EST Mondays, Wednesdays and Fridays on FreightWaves LinkedIn, Facebook, X or YouTube, or on demand by looking up WHAT THE TRUCK?!? on your favorite podcast player and at 5 p.m. Eastern on SiriusXM’s Road Dog Trucking Channel 146.
MAFA
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A sobering reminder
Rate the strap work fail
Dronemania has swept the nation, but if you’re hoping the government is here to help … welp, we have senators who can’t even identify a TIE Fighter. Had he been a follower of my rate the strap work series, he would have recognized that as one of the first ones we ever did.
We should have listened to Atari.
The rest of the noise
DAT acquires Trucker Tools, leadership speaks on tech goals for 2025
Macy’s $151M freight accounting scandal: What happened with parcel deliveries?
Pitt Ohio adds Midwest carrier Sutton Transport to network
Now on demand
Kal Freight’s fraud allegations; Make-A-Wish convoys; Vooma’s $13M Series A
Freight Essentials files RICO lawsuit against shipping giants
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Don’t be a stranger,
Dooner
The post Tariffs spook shippers and consumers as trucking surges appeared first on FreightWaves.
