For-hire truck tonnage in the U.S. dipped in December, but vocational orders are soaring as infrastructure projects commence.

The spot market was mixed, but one thing is certain: Freight will grow in the years ahead, according to the American Trucking Associations. Vocational truck demand is soaring due to infrastructure projects in the U.S.

Truck tonnage dipped in December: ATA

U.S. for-hire truck tonnage contracted in December for the second straight month, according to the American Trucking Associations (ATA).

“For the first time since March and April truck tonnage contracted for two consecutive months,” said ATA chief economist Bob Costello. “Tonnage fell 1.8% in November, bringing the two-month total decrease to 2.9%, pushing tonnage to its lowest level since January 2024. Sluggishness in factory output continues to weigh on freight volumes, but another drag on the index has been fleet growth at private carriers, which is holding back how much freight is flowing to for-hire carriers.”

Vocational orders soar

September marked the all-time best month for heavy vocational truck orders, according to ACT Research. They totaled 20,000 units, and for the quarter ending in November, 38,100 units.

“The big story is healthy tailwinds driving demand in the form of U.S. industrial policy and stimulus plans that had manufacturing and private construction expenditures running at record levels into the end of 2024,” said Kenny Vieth, ACT’s president and senior analyst.

“Much of the [approximately] $2 trillion in stimulus from CHIPS, IRA, and IIJA put in place in 2021 and 2022 continues to be deployed into the economy, providing good visibility for equipment buyers. In addition to well supported end markets and expectations of some additional inventory building, expensive technology-forcing regulations on the horizon give vocational truck buyers not only willingness to get a head start on refreshing their fleet, but clearly, the ability as well.”

Van rates fall, as expected

Truckstop and FTR Transportation Intelligence report a decline in rates for the week ended Jan. 17, which aligns with seasonal expectations.

Dry van rates in the U.S. booked their biggest decrease since February while reefer rates fell by the most since U.S. Thanksgiving.

The current week, ended today, usually sees falling van rates and rising flatbed rates. But cold winter weather could prove disruptive, the companies say. The Market Demand Index fell to 84.2.

Spot market ended 2024 strong: DAT

The U.S. spot market ended 2024 strong, according to DAT Freight & Analytics, reflecting strong retail and grocery sales ahead of the holidays in December.

December saw van rates climb 2.4% and reefer 3%, while flatbed rates dropped 5% versus November.

Year-over-year van and reefer rates were up 12% and 20%, respectively.

“December freight volumes were strong despite the quirks of the calendar,” said Ken Adamo, DAT chief of analytics, noting that Christmas fell on a Wednesday and there were only three non-holiday weeks between Thanksgiving and the end of the year. “The combination of seasonal volumes, fewer shipping days, and truckers taking time off for the holidays led to higher spot prices compared to November. Net fuel, the van rate was the highest monthly average since January 2023.”

In December: spot van rates were $2.11 per mile (all figures US), up 9 cents from November; reefer rates were $2.47, up 2 cents, and flatbed rates were $2.39, up 2 cents.

“The difference between van and reefer spot and contract rates narrowed for the fourth straight month and was the smallest since March 2022, when spot rates entered a severe deflationary period,” Adamo said. “When the gap between spot and long-term contract rates is trending lower, it’s a signal that capacity is tightening and negotiating power is shifting toward truckload carriers.”

Truck volumes expected to grow

The ATA has issued its annual freight forecast, and predicts that after two years of decline, truck volumes in the U.S. will grow 1.6% this year.

“In this edition of ATA’s Freight Transportation Forecast, the trucking industry continues to dominate the freight transportation industry in terms of both tonnage and revenue, comprising 72.7% of tonnage and 76.9% of revenue in 2024,” said Costello. “We project that market share to hold over the next decade as the country continues to rely on trucking to move the vast majority of freight.”

ATA projects truck tonnage will rise from 11.27 billion tons in 2024, to 13.99 billion in 2035. Trucking revenues over that time are projected to grow from US$906 billion to $1.46 trillion.