Cautious optimism rises as the trucking industry shows select signs of stabilization, but organizations must navigate several hurdles before declaring victory over the downturn.
Balaji Guntur is a vice president in the Global Transportation Practice of the management consultancy Kearney. Additionally, Guntur is a co-founder and chief executive officer of Hoptek, a Kearney company focused on the trucking industry with a suite of software-based products.
Sean Maharaj is a vice president in the Global Transportation Practice of the management consultancy Kearney. Additionally, Maharaj is a chief commercial officer of Kearney’s Hoptek.
The trucking industry has long been sensitive to economic fluctuations, and the past couple of years have seen a great deal of pain in the industry, with the recent folding of many fleets. Following 27 months of consistent rate declines, 2024 has finally seen a slight year-on-year increase of 0.2% in trucking rates. This modest rise has led some to speculate that the worst may be over, but this small uptick signals just a potential turning point. It is not yet an indication of full recovery. The industry won’t start to feel any true relief until it experiences one full quarter of positive gains, albeit accompanied by some turbulence.
The root cause of the industry’s ongoing struggles lie within the pandemic-driven imbalance between supply and demand. When demand surged during COVID-19, over 100,000 new trucking companies entered the market to capitalize on what was seen as a “hot” market. These new entrants purchased trucks at record-high prices, believing the pandemic-driven boom would last into the foreseeable future. But all good things end, and as demand tapered off in 2022, many were left with costly assets and loans they could no longer afford to maintain against a backdrop of rapidly falling rates. As a result, the trucking industry found itself awash in excess capacity, with rates plummeting accordingly.
Freight volumes are a key indicator of the industry’s health. After a steep decline in truck tonnage during spring 2023, there was a brief period of fragile stability, only for 2024 to kick off with another sharp downward spiral. The first half of 2024 was marked by volatile swings: a 4.3% rise from January to February, almost erased by a 3.2% drop through April. Then, a 3.6% rise in May was followed by a 1.6% drop in June. Despite the volatility, each dip has become seemingly less severe. If this pattern of incrementally higher lows continues, broader stabilization seems more likely, according to the data.
Spot rates for dry van shipping have fluctuated between $2.01 and $2.20 per mile, a stark contrast to the $3.28 peak of June 2022. Contract rates, which traditionally offer more stability, have similarly declined, hovering around $2.48 to $2.73 per mile. Today, anecdotal evidence suggests that contract rates have bottomed out and are on the rise, as more carriers voice concerns to shippers that low rates will no longer be tolerated or subsidized.
This persistent softness in rates has forced thousands of carriers out of the market. From December 2022 to March 2024, the Federal Motor Carrier Safety Administration reported a 7.6% reduction in carriers and a 10.7% reduction in brokers. The bankruptcy of Yellow, a major less-than-truckload (LTL) operator, sent shockwaves through the sector in August 2023. These ripples are still being felt today, as 10,000 carriers have ceased operation in the first half of 2024 alone.
However, there are more encouraging signs of life beyond the slight 0.2% year-on-year increase in shipping costs and the higher lows in month-to-month freight volume swings. For the first time since the pandemic, the number of revoked registrations has surpassed new ones, indicating that capacity is beginning to tighten up. In addition, the expiration or default of COVID-related loans could further bring about capacity reduction, serving as a market-clearing mechanism. While this is far from a full recovery, it does suggest that the industry is starting to balance out.
Looking ahead
The Cass Truckload Linehaul Index is a measure of the movement in linehaul rates. This index includes both spot and contract freight.
Cass Information Systems Inc.
The remainder of 2024 is expected to continue to be a transitional year for the trucking sector. The general sentiment in the market is that while we may have hit rock bottom, recovery will be gradual, uneven, and nonlinear. Many analysts are eyeing fall 2024 as the earliest sign of true improvement, though more cautious predictions push meaningful recovery into spring 2025.
The Cass Truckload Linehaul Index (see chart above) indicates that we’ve reached a floor in rates, but carriers are still struggling to find their footing. Frustrated by unsustainably low rates, many carriers are still turning down low-margin freight due to rising operational costs like fuel, labor, and maintenance, which has left them unable to maintain profitability or support operations at such thin margins. Inflation, fluctuating inventory levels, and construction activity will all influence how quickly demand recovers and whether carriers can emerge from this precarious situation.
While inflation is cooling and consumer demand is slowly picking up, the sector remains highly sensitive to external factors such as geopolitical tensions and broader economic health. Until demand recovers more robustly, trucking will remain in a state of flux.
Leveraging tech to fast-track recovery
The challenges facing the trucking industry also present an opportunity to innovate and transform. Digital transformation is increasingly being seen as a lifeline for carriers looking to weather the storm, while gaining a competitive advantage. The adoption of technology across various aspects of trucking—from logistics to operations—will play a critical role in reshaping the industry’s future.
One area where technology is making a significant impact is in route optimization and digital freight matching. With excess capacity still a significant issue, digital freight platforms are helping carriers fill trucks by matching them with third-party shippers, thus minimizing deadhead miles and improving asset utilization. This technology helps level the playing field, enabling operators to compete more effectively, while keeping drivers happy and improving the bottom line.
Artificial intelligence (AI)-powered route planning and dispatch tools are also gaining significant traction. These tools leverage existing data sets and systems to analyze and suggest, in real-time, the most optimal plan in the context of a driver’s trip. These optimal plans limit judgment (and, therefore, offer less room for error, bias, and waste), miscalculations, unnecessary mileage, and fuel consumption. Through optimization and real-time dispatch, carriers can reduce empty miles and lower operating costs to achieve higher levels of performance.
Finally, transportation management systems (TMS) are essential for fleet managers, and modernization of these systems is underway. These systems provide end-to-end visibility over operations, allowing companies to monitor shipments, improve communication with shippers, and respond more dynamically to market changes. AI-driven analytics allow carriers to forecast demand more accurately and adjust their operations more proactively. These tech-driven improvements could be game changers, especially for operators struggling to compete in a turbulent market.
Shippers’ role in recovery
Shippers, too, have a role to play in the industry’s recovery. By diversifying their carrier networks and embracing technology, they can build more resilient supply chains. The pandemic exposed vulnerabilities in relying too heavily on a small pool of carriers. Now, by leveraging digital freight matching and analytics, shippers can not only find the best-fit carrier(s) but also build a robust network of backup options—safeguarding against supply chain disruptions caused by the next geopolitical or global health crisis. Savvy shippers will continue to look to carriers for improved efficiency and the reduction of cost and complexity, and technology will continue to be the enabler.
Walk into any high-velocity distribution facility and you'll immediately grasp the complexity: dozens of forklifts move in orchestrated patterns while automated systems hum along conveyor lines, all working to meet demanding throughput targets. Yet what remains invisible to the casual observer is how maintenance challenges can bring this carefully choreographed dance to a halt.
For facilities moving millions of pieces weekly, maintenance demands fundamentally different solutions. The traditional approach to material handling maintenance that works for smaller operations isn't just constraining productivity—it's holding back your entire operation.
Warning signs that you need an upgrade
For facility leaders managing 40+ forklifts and complex material handling systems, the warning signs often hide in plain sight. The first clear indicator that your current maintenance strategy isn't keeping pace with your high-velocity facility appears when equipment downtime increasingly affects your ability to meet throughput targets. This challenge is compounded by climbing rental equipment costs as you struggle to compensate for unavailable machinery. The human impact becomes evident when floor supervisors and staff begin expressing mounting frustration about not having the machinery they need available to do their job.
More concerning still, safety incidents related to equipment issues may become more frequent, creating both operational and liability risks. The financial strain finally manifests in mounting overtime costs because you simply don't have enough functioning equipment to run operations efficiently. These interconnected issues signal a maintenance strategy that needs urgent reevaluation and restructuring.
If these symptoms sound familiar, you're not alone. Many high-velocity facilities have outgrown the same maintenance principles they applied as a smaller operation, only to find them inadequate at scale.
The scale challenge
The complexity of a large facility creates unique challenges that make traditional maintenance approaches insufficient. Equipment diversity presents a significant hurdle, as larger facilities must manage multiple types of forklifts, automated systems, and specialized equipment, each requiring different maintenance expertise and parts inventories. Communication complexity also poses a major challenge—while information flows easily in smaller facilities where everyone knows the status of every piece of equipment, this informal communication breaks down in large operations with multiple shifts.
The scale of impact becomes exponentially more significant in high-velocity facilities, where a single forklift breakdown in a critical area can impact dozens of downstream processes. Maintenance timing presents another crucial challenge, as continuous operations and high utilization rates make it increasingly difficult to find maintenance windows, and waiting for equipment to fail is simply not an option.
Building a maintenance strategy that matches your scale
High-velocity facilities require a transformed maintenance approach, not just scaled-up traditional processes. This starts with dedicated on-site teams who develop deep facility knowledge and conduct preventive maintenance strategically during optimal windows. Smart inventory management of parts ensures critical components are always available without overstocking, while data-driven systems help track equipment performance patterns and guide future investment decisions.
Before investing millions in facility expansion or automation, consider this: Implementing proper maintenance strategies can boost productivity 10%-20% at a fraction of the cost of facility expansion or automation. This comprehensive approach leads to reduced equipment downtime, improved safety outcomes, and enhanced staff satisfaction by transforming maintenance from a reactive necessity into a proactive tool for operational excellence.
Ready to transform your maintenance strategy? Here are the key steps to implementation:
Start with a thorough assessment phase, reviewing safety incidents, analyzing current maintenance costs, and evaluating how maintenance affects facility key performance indicators (KPIs).
Develop tailored processes by establishing proper preventive maintenance procedures and implementing robust data collection protocols.
Structure your maintenance team effectively, with clear roles, communication protocols across shifts, and comprehensive training programs.
By taking this methodical approach to maintenance strategy, facilities can achieve operational excellence without the massive capital expenditure typically associated with major operational improvements. The key lies not in maintaining more, but in maintaining smarter.
In today's fast-paced distribution environment, your maintenance strategy can't be an afterthought—it needs to be as sophisticated as your operations. In high-velocity facilities. Maintenance isn't just about fixing equipment, it's about maintaining productivity, safety, and competitive advantage. The time to evolve your maintenance strategy is now, before considering more costly alternatives. Your facility's full potential depends on it.
About the Author: Cory Monroe is Regional Sales Director at Concentric, a national distributed power services organization specializing in maintenance and power solutions that deliver resilient and sustainable facility systems for critical power and forklift mobility.
In a statement, DCA airport officials said they would open the facility again today for flights after planes were grounded for more than 12 hours. “Reagan National airport will resume flight operations at 11:00am. All airport roads and terminals are open. Some flights have been delayed or cancelled, so passengers are encouraged to check with their airline for specific flight information,” the facility said in a social media post.
An investigation into the cause of the crash is now underway, being led by the National Transportation Safety Board (NTSB) and assisted by the Federal Aviation Administration (FAA). Neither agency had released additional information yet today.
First responders say nearly 70 people may have died in the crash, including all 60 passengers and four crew on the American Airlines flight and three soldiers in the military helicopter after both aircraft appeared to explode upon impact and fall into the Potomac River.
Editor's note:This article was revised on February 3.
Reducing empty miles—or the distance traveled with no load or cargo—can have multiple benefits, including increased cost savings and streamlined operations. But at its core, it’s about making smarter, more sustainable choices while transporting goods. Here are three components to craft and execute a successful empty miles program, keeping collaboration in mind at each stop along the way.
1. Route Optimization: Streamlining Your Routes to Minimize Empty Miles
Eliminating empty miles begins with route optimization. By analyzing traffic patterns, delivery windows, and geographical distances, logistics leaders can uncover opportunities in their network to minimize empty miles. You can think of route optimization as a more advanced version of strategies used every day by commuters, who adjust their errands to avoid rush-hour traffic, efficiently visit stores in the same shopping center, and use backroads to bypass slowdowns.
To overcome route challenges, organizations should invest in new tools and technology like real-time planning software that helps companies to adjust routes dynamically. These enterprise tools go beyond finding the shortest paths between destinations and unlock granular data on various factors like delivery time windows and vehicle capacity to ensure operations run as smoothly as possible.
Some cutting-edge solutions use artificial intelligence (AI) and machine learning to continuously adjust routes, improve overall productivity, and even boost customer satisfaction rates with reliable tracking information.
To understand what solutions are needed to maximize route potential, companies should evaluate their internal resources and capabilities, as well as consider the type of fleet they manage. For instance, there’s more visibility and direct influence over a private fleet compared to operating through a third party, so the approach may differ in each scenario.
2. Lane Matching & Transportation Collaboration: Team Up to Boost Efficiency and Drive Sustainability
Consider this: According to the U.S. Environmental Protection Agency (EPA), transportation accounted for the largest portion of total greenhouse gas (GHG) emissions in 2022. Now, picture a world where every truck journey is diligently planned to minimize empty space, limit miles on the road and maximize delivery potential—all of which can contribute to reduced greenhouse gas emissions.
This vision becomes reality through collaborative efforts between shippers and carriers. By strategically matching trucks with loads that share similar routes, businesses can drastically reduce their empty miles, helping their bottom line, and the planet. Leaders should look for these lane-matching opportunities, even if that means putting aside competitive differences in the name of the partnership.
Imagine two companies with fast-moving goods that are both sending partial loads down similar routes. By lane sharing and working together to combine these hauls into one truckload, both companies limit the miles spent on the road and improve their asset utilization.
Another form of transportation collaboration involves strategic pickups and returns. Think about the practical example of dropping off pallets along a route and conveniently picking up finished goods from customers on the return trip. This method improves truck capacity while significantly reducing the carbon footprint in each journey.
These key examples underscore the power of partnerships in achieving mutual goals, demonstrating the success industry players can have when they work together toward common objectives.
3. Unit Load Planning: Maximizing Your Space to Reduce Costs
The American Council for an Energy Efficient Economy (AEEE) estimates that 20%-35% of trucks are driven empty, and those that aren’t empty carry just 57% of their capacity. Effective unit load optimization goes beyond filling truck space—it ensures that every cubic inch is utilized to its fullest potential.
Take employees restocking grocery store shelves, for example. In this scenario, load planning maximization looks like stacking cans on top of each other to fit more on a shelf or pulling out better-selling product collections to their own stand-alone display. By actively planning where each product will go, employees can better stock the items and consolidate the number of carts needed to move products.
Within the supply network, companies can explore solutions to optimize their load planning. One includes leveraging test centers, which can uncover invaluable insights into optimal stacking and loading configurations by simulating various scenarios and measuring their outcomes. Taking this a step further, companies can look to adjust their product packaging or transport platforms, such as transitioning to collapsible containers to maximize space. These types of decisions can also translate into substantial cost savings through reductions in labor and handling, pallet costs, and transportation expenses.
Using Technology to Drive Success
While collaboration and strategic planning is fundamental, the impact is even bigger when supported by next-gen technologies. McKinsey reports that 68% of logistics providers and 56% of shippers have invested more in advanced transportation solutions like real-time transportation visibility, route optimization, and telematics since 2020.
These platforms streamline the process of identifying suitable partners by not only considering supply chain variables like anticipated demand but also brand-level commitments like environmental, social, and governance (ESG) objectives. By delivering automated insights, digital solutions empower supply chain leaders to make informed, data-driven decisions to achieve business goals through the best-fit solutions and partnerships.
It's More Than Empty Miles
For many years, businesses have accepted empty miles as a cost of doing business. But the tangible outcomes of collaborative efforts speak volumes. Customer data shows that last year in North America alone, businesses leveraging CHEP’s transportation solutions eliminated approximately 4.7 million empty miles and more than 15 million pounds of C02 from their transportation networks.
When business leaders shift their perspective to recognize that this strategy is more than empty miles, they unlock the future of the supply chain. If companies work together, leverage the latest technology and actively look to better their lane and route strategies, it’s possible to create a more sustainable, productive and resilient supply network.
About the author: Dan Ahrens is the director of Customer Solutions & Zero Waste World at CHEP North America.
GE Vernova today said it plans to invest nearly $600 million in its U.S. factories and facilities over the next two years to support its energy businesses, which make equipment for generating electricity through gas power, grid, nuclear, and onshore wind.
The company was created just nine months ago as a spin-off from its parent corporation, General Electric, with a mission to meet surging global electricity demands. That move created a company with some 18,000 workers across 50 states in the U.S., with 18 U.S. manufacturing facilities and its global headquarters located in Massachusetts. GE Vernova’s technology helps produce approximately 25% of the world’s energy and is currently deployed in more than 140 countries.
The new investments – expected to create approximately 1,500 new U.S. jobs – will help drive U.S. energy affordability, national security, and competitiveness, and enable the American manufacturing footprint needed to support expanding global exports, the company said. They follow more than $167 million in funding in 2024 across a range of GE Vernova sites, helping create more than 1,120 jobs. And following a forecast that worldwide energy needs are on pace to double, GE Vernova is also planning a $9 billion cumulative global capex and R&D investment plan through 2028.
The new investments include:
almost $300 million in support of its Gas Power business and build-out of capacity to make heavy duty gas turbines, for facilities in Greenville, SC, Schenectady, NY, Parsippany, NJ, and Bangor, ME.
nearly $20 million to expand capacity at its Grid Solutions facilities in Charleroi, PA, which manufactures switchgear, and Clearwater, FL, which produces capacitors and instrument transformers.
more than $50 million to enhance safety, quality and productivity at its Wilmington, NC-based GE Hitachi nuclear business and to launch its next generation nuclear fuel design.
nearly $100 million in its manufacturing facilities at U.S. onshore wind factories in Pensacola, FL, Schenectady, NY and Grand Forks, ND, and its remanufacturing facilities in Amarillo, TX.
more than $10 million in its Pittsburgh, PA facility to expand capabilities across its Electrification segment, adding U.S. manufacturing capacity to support the U.S. grid, and demand for solar and energy storage
almost $100 million for its energy innovation research hub, the Advanced Research Center in Niskayuna, NY, to strengthen the center’s electrification and carbon efforts, enable continued recruitment of top-tier talent, and push forward innovative technologies, including $15 million for Generative Artificial Intelligence (AI) work.
“These investments represent our serious commitment and responsibility as the leading energy manufacturer in the United States to help meet America’s and the world’s accelerating energy demand,” Scott Strazik, CEO of GE Vernova, said in a release. “These strategic investments and the jobs they create aim to both help our customers meet the doubling of demand and accelerate American innovation and technology development to boost the country’s energy security and global competitiveness.”
The less-than-truckload (LTL) industry moved closer to a revamped freight classification system this week, as the National Motor Freight Traffic Association (NMFTA) continued to spread the word about upcoming changes to the way it helps shippers and carriers determine delivery rates. The NMFTA will publish proposed changes to its National Motor Freight Classification (NMFC) system Thursday, a transition announced last year, and that the organization has termed its “classification reimagination” process.
Businesses throughout the LTL industry will be affected by the changes, as the NMFC is a tool for setting prices that is used daily by transportation providers, trucking fleets, third party logistics service providers (3PLs), and freight brokers.
Representatives from NMFTA were on hand to discuss the changes at the LTL-focused supply chain conference Jump Start 25 in Atlanta this week. The project’s goal is to make what is currently a complex freight classification system easier to understand and “to make the logistics process as frictionless as possible,” NMFTA’s Director of Operations Keith Peterson told attendees during a presentation about the project.
The changes seek to simplify classification by grouping similar items together and assigning most classes based solely on density. Exceptions will be handled separately, adding other characteristics when density alone is not enough to determine an accurate class.
When the updates take effect later this year, shippers may see shifts in the LTL prices they pay to move freight—because the way their freight is classified, and subsequently billed, could change as a result.
NMFTA will publish the proposed changes this Thursday, January 30, in a document called Docket 2025-1. The docket will include more than 90 proposed changes and is open to industry feedback through February 25. NMFTA will follow with a public meeting to review and discuss feedback on March 3. The changes will take effect July 19.
NMFTA has a dedicated website detailing the changes, where industry stakeholders can register to receive bi-weekly updates: https://info.nmfta.org/2025-nmfc-changes.