Three of the nation’s leading haulers of less-than-truckload (LTL) freight have announced rate hikes, of the exact same amount. ABF, YRC and UPS Freight have all announced a general rate increase of 5.9%.
As shippers are well aware, these rate hikes typically occur at least annually, generally for between 5-7%. As soon as one LTL carrier announces its planned increase, others generally announce their increases shortly thereafter. So it’s likely that the other major national trucking companies will follow suit.
YRC explained that its rate increase will help “offset cost pressures such as those associated with driver shortages and enable additional investment in technologies and processes for compliance with new Hours of Service legislation and CSA safety initiatives.”
According to Lawrence Gross, senior consultant for freight analyst firm FTR Associates, “Every indication is that the Hours of Service regulatory changes will occur as scheduled July 1, which FTR projects will reduce trucking productivity by about 3%.” Such a decline, he warns, “will be sufficient to tip the balance of supply and demand significantly away from shippers, assuming the economy continues to maintain at least the anemic growth levels seen recently. This will usher in an extended period of difficulty for shippers, as there is an array of new regulations lined up behind the HOS change that will further impact trucking in the months and even years to come.”