October 2024 Industry Update

Executive Summary

As we enter the final quarter of 2024, economic indicators show improvement but the transportation industry remains mixed, with strength in the intermodal and maritime sectors contrasting with continued challenges in the truckload market.

September brought several positive developments for the broader economy, with the labor market leading the way. Job gains far exceeded expectations, with upward revisions to July and August estimates adding a net 72,000 jobs to the 254,000 increase in payroll employment for the month. Other notable developments included the Federal Reserve's first interest rate cut at the September meeting, signaling the possibility of further cuts this year. Additionally, the third release of second-quarter GDP data showed only minor revisions, maintaining a growth estimate of 3.0%. However, the economic effects of Hurricane Helene remain uncertain, with damage estimated between $145 billion and $160 billion, alongside expected declines in consumer spending, job losses and furloughs in key sectors such as retail and agriculture.

Truckload conditions remained challenging in September, with excess capacity continuing to suppress growth. Despite stable freight volumes, further contraction in domestic manufacturing has dampened potential growth in truckload activity. As the peak shipping season approaches, demand is expected to remain subdued, similar to the past two years, as the oversupply of capacity easily absorbs any increases in volume. In contrast, rail carriers continue to benefit from gains in market share, with intermodal volumes growing in September. U.S. container imports also saw growth, totaling over 2.5 million twenty-foot equivalent units (TEUs), up 1.7% MoM and 14.4% YoY.

The port strikes by the International Longshoremen's Association (ILA) along the East and Gulf Coasts, which began on October 1, lasted only three days before a tentative agreement was reached with the U.S. Maritime Alliance (USMX). The agreement, which extends the current master contract through January 15 of next year, includes a 62% increase in top wages for longshore workers and allows ports to reopen while negotiations continue. Although these ports handle approximately 25% of U.S. imports annually, the early announcement of the strike led to reduced volumes through frontloading and diversions. The short duration of the stoppage is expected to enable a quick return to normal operations within days rather than weeks.

Industry Overview: September Key Figures (YoY)

Truck Data Points	YoY% Change
DAT Spot Rates (incl. FSC)	-8.0 q
Fuel Prices	-22.0 q
ACT Class 8 Preliminary Orders	16.0 p
ATA NSA Truck Tonnage*	-1.1 q
Cass Freight Index**	-3.3 q
Cass Freight Shipments	-1.9 q
Cass Freight Expenditures	-9.9 q

*Report released on 9/24/2024

**Report released on 9/14/2024

October 2024 Industry Update

Executive Summary

Industry Overview: September Key Figures (YoY)

Main Takeaways

Economy

Truckload Rates

Truckload Demand

Truckload Supply

Truckload Capacity Outlook

Fuel

Dry Van

Reefer

Flatbed

Intermodal

Further Reading