COLUMBUS, Ind. – Spot market pressure is expected to persist, as more trucking capacity comes online, according to ACT Research’s Freight Forecast.
The industry forecaster said it expects excess capacity to exert more downward pressure on truckload spot rates.
“The rebalancing trend is still valid for 2020, but we think Q4 spot rates will actually fall from Q3 this year, counter to the seasonal pattern, due to the supply/demand imbalance detailed in the Freight Forecast report,” said Tim Denoyer, ACT Research’s vice-president and senior analyst.
“We see the signs that capacity is beginning to come at the margin in some places, from company failures to lower for-hire employment data, but the industry still added about 5,000 net new tractors to the U.S. highways last month. This reflects ongoing capacity additions by private fleets, as the for-hire sector isn’t the problem. This will change next year, but this rate of capacity addition will continue through year-end.”
ACT reports freight has softened in recent weeks, following a brief respite early in Q3. The freight recession is showing signs of broadening, the organization says, amid weaker industrial indicators.
“While holiday spending and pre-tariff inventory building may help volumes in Q4, we continue to see heightened risk of weak freight volume in early 2020 as inventories draw down,” ACT reported.