It’s peak season, but FTR CEO Jonathan Starks said it’s not consumers driving shifts in the transportation market. The pressure is coming from the industrial side, tight capacity, rising costs and tougher regulatory enforcement.
During FTR Transportation Intelligence’s State of Freight webinar last week, Avery Vise, vice president of trucking, noted that truckload capacity is not expected to loosen much, even though spot rates seem to have peaked.
“We do think that spot rates have more or less peaked out, but are not going to really be coming down, and that’s unusual,” said Vise. Normally a big swing up is followed by relief as capacity flows into the contract market, FTR doesn’t expect that to happen right away.
Joseph Towers, senior analyst for rail, said the industrial economy has improved modestly, noting that the ISM Manufacturing PMI 2026 readings run from about 52% to about 56%. Industrial production growth through 2024 had been limited to mining and utilities, which generate little freight.
FTR isn’t expecting a boom anytime soon. The forecast shows quarterly industrial growth of roughly 1% to 2% through 2027.
Fuel continues to drive inflation, Vise said, along with data center demand. Computer-related imports from Mexico have surged to about $27 billion at the latest peak, while volume has stayed around 600,000 short tons.
Vise said this isn’t tariff-driven. “This is driven by the sheer demand, and that is having a big impact because there’s very little price elasticity in this area.”
Another factor driving inflation is metals. The Producer Price Index for metals and metals products has climbed to about 370, with year-over-year growth of roughly 15%. Metal products face a 50% Section 232 tariff, effective April 2026, and covered derivatives can face a 25% tariff on full product value.
Tariffs raise domestic costs, Vise said, because they create “more demand on domestic producers” and give them “the pricing flexibility to increase costs.”
Rates hold steady after peak
Vise listed this year’s stresses on the spot market: a late January winter storm, a 96-cent one-week jump in diesel, International Roadcheck and the midyear peak.
Dry van all-in spot rates peaked at 53.0% above year-earlier levels in the week-21 reading and were up 45.2% year over year in the latest week, at about $2.86 per mile. They fell short of seasonal expectations after the midyear peak, but have closed that gap since Labor Day.
That coincided with record diesel prices, which Vise said suggests fuel cost recovery is a factor. Now that diesel prices have moderated, it seems “we may indeed be back in the same sort of environment we were in earlier,” he noted.
Refrigerated rates have been on par with 2021, the strongest prior year, though the last couple of quarters have been above that. The latest week is about $3.54 per mile.
Flatbed have been higher still: “Starting around Q2, probably in large degree because of fuel cost recovery, those rates have been the highest ever for comparable weeks.” The flatbed peak was about $3.85 per mile, and the latest week is about $3.35.
Spot rates are expected to flatten after this year’s surge. FTR forecasts 2026 spot rate growth of 37.6% for dry van, 35.8% for refrigerated and 35.3% for flatbed, all excluding fuel surcharges. Next year, growth drops to 3.2% for dry van, 1.3% for refrigerated and 2.3% for flatbed. Vise described a “token amount of growth next year,” which he called unusual after a large swing.
Why capacity isn't loosening
Trucking payroll jobs has “finally bottomed out,” Vise said, with seasonally adjusted payrolls up 8,000 over three months. For-hire trucking employment is now about 1.47 million, down from a peak of about 1.59 million in 2022.
Active truck utilization is about 99%, and FTR forecasts a gradual decline of at least a historically high rate of 96%. Vise said, “That does not provide very much relief from the market for shippers, and it keeps rates fairly strong for carriers.”
The biggest factor pressuring capacity is the regulatory squeeze on foreign drivers, Vise said.
- English proficiency enforcement: It has “sidelined roughly 30,000 drivers over the last year,” with a run rate of “probably another 28,000 this year.”
- Non-domiciled CDLs: The issue is “still in flux” while the U.S. Court of Appeals for the D.C. Circuit weighs the Federal Motor Carrier Safety Administration rule.
- FMCSA’s Motus rollout: It has been “rough and creating its own friction,” with carriers being “flagged as not having active insurance when they actually do.”
- Electronic logging device crackdown: A bigger factor than the CDL mill crackdown, Vise pointed out, given concerns about foreign dispatchers editing logs.
- Broker liability: After the U.S. Supreme Court’s May decision in Montgomery V. Caribe Transport II, Vise noted there is “much more scrutiny on the selection of carriers than there was before.”
If these pressures hit the maximum impact, FTR’s extreme case shows the Class 8 population staying around 3.5 million through 2027, and it could mean that that there’s essentially no increase in trucks.
Vise doesn’t expect that, noting that the market would prevent the worst case. “If we start to trend that way, driver wages will go up to the point where we’ll be able to bring in more drivers,” he said.
Following three consecutive quarters of contraction, the U.S. commercial trucking sector rebounded in Q3 this year, welcoming close to 10,000 new prospective fleets and over 229,000 units of verified equipment, according to the RigDig database. New vehicles drove the primary growth within the U.S. trucking sector during the quarter ending last month.
