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Freight Markets Remain Soft

Freight Markets Remain Soft

Sept. 22, 2023
ACT Research expects just mid-single-digit growth in freight volumes, helping to explain the difference between the accelerating US economy and declining for-hire volumes.

Though significant progress has been made in rebalancing,  ACT Research says that feel it's "s unlikely that industry capacity will broadly tighten until pressure from capacity growth eases, which seems unlikely for the next few months.", This is according to the latest release of the Freight Forecast, U.S. Rate and Volume OUTLOOK report.

“We’ve created a proxy for private fleet activity that suggests mid-single-digit growth in freight volumes, helping to explain the difference between the accelerating US economy and declining for-hire volumes,” shared Tim Denoyer, ACT Research’s Vice President and Senior Analyst, in a statement..

Denoyer  said that "private fleet growth is evident as Class 8 tractor retail sales are on" pace to set a record this year, yet for-hire fleets are by and large demonstrating capital discipline.”

Looking at the overall market Denoyer comments  that Though the freight market is still near the bottom of the cycle, in our view, new truck orders in the next few months will be pivotal to setting the market tone for 2024. .The capacity contraction in the for-hire sector is beginning to coil the proverbial spring for better market conditions, but this improving outlook could be spoiled if fleet expansion continues ahead of industry need.

“We expect industry financial trends to dictate greater capital discipline next year, but further overexpansion is possible as fleets plan for significant emissions regulations looming in the future."

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