By Fello Logistics
You may have noticed already, but toward the end of 2024, for-hire carrier rates started indicating that the freight recession of the last couple years may be over.
FreightWaves reports on an ACT Research forecast indicating that both spot rates and linehaul rates are already on their way back up:
Using data provided by DAT, Denoyer adds that spot rates net of fuel are 7% higher than one year ago in Q4, while data provided by DAT, Cass Information Systems and fleet financial data shows modest increases in contract rates.
SONAR spot rates net of fuel were more optimistic, up 14.7% y/y from $1.63 to $1.87 as of Nov. 26. The FreightWaves National Truckload Index (Linehaul Only) estimates its fuel surcharge “based on the average retail price of diesel fuel and fuel efficiency of 6.5 miles per gallon. The formula is NTID – (DTS.USA/6.5).” Comparing Q4 2023 to Q4 2024 quarter to date shows an average linehaul rate of $1.60 versus $1.74, an increase of 8.75% as of Nov. 26.
This doesn’t necessarily mean a boom is coming. It might just mean the market is finally balancing back out after the boom of 2022 was followed by the relative bust of 2023 and 2024.
And FreightWaves cautions that private fleet expansion is likely to temper any chances of another explosion in rates.
From the perspective of our shipper clients, of course, we love to see low rates. But the trucking recession of the last couple years has been tough on a lot of carriers and it’s thinned out the herd a bit.
Addressing Shippers’ Concerns
As the market begins to shift, we’ve heard a recurring concern from potential clients: Many are worried that their service levels will decline as capacity tightens. They’ve seen it happen before — when the market favors carriers, service levels often drop, and that’s why they’re looking for new providers.
At Fello, we understand these concerns and have built our model to prevent exactly that. Service is not something we compromise on, regardless of market conditions.
We’re doubling down on our work with our carrier network to ensure Fello clients continue to enjoy the same excellent service they have come to expect. The issues of the last few years haven’t really affected Fello’s carrier network because we prioritize partnerships with solid, dependable carriers who are resilient in the face of market fluctuations.
The Fello Advantage
Our big-picture message to shippers who work with us is this: The most important thing we offer is exceptional customer service and the confidence you can have knowing your freight is in good hands. Our on-time delivery rate is exceptional, and if problems occur there is no one in the industry who will do a better job of communicating and solving the problem.
We’re not the cheapest provider — and that’s intentional. We don’t work with clients who are willing to risk delivery problems to save a few dollars. Instead, we work with clients who value reliability and trust.
Our established relationships with carriers allow us to negotiate rates that reflect long-term partnerships and mutual respect. Carriers trust us to reward their excellent performance with continued business opportunities, and shippers benefit from this stability.
But that doesn’t mean rising rates present no concerns, which is one of the reasons our clients are better off having us handle their logistics needs. We have established relationships with the carriers we hire. They know our clients. They know our processes. They have the long-term picture in mind.
Looking Ahead to 2025
The best scenario for everyone is a stable, solid carrier market that serves shippers at reasonable rates while enabling carriers to thrive. That’s what we aim to deliver for our clients in 2025. Even as the freight economy swings back in favor of carriers, we know how to maintain balance and ensure that everyone — shippers and carriers alike — comes out a winner.
Fello Logistics is known for integrity, reliability, industry-leading customer service and genuine care for it’s clients. Learn more about our freight shipping services.
