For-hire freight capacity increased in March while freight volumes declined, according to ACT Research’s latest For-Hire Trucking Index.

The Volume Index dropped 4.5 points to a seasonally adjusted 43.6 in March, down from 48.1 in February.

“While spot load postings were strong in March, this is consistent with ongoing softness in the Cass Freight Index,” said Carter Vieth, research analyst at ACT Research. “The weak reading in our survey may be related to the later timing of the Chinese New Year this year, creating some sub-seasonality effects from February to March. Additionally, while inventory has been pulled ahead, uncertainty may be causing businesses to sit on inventory longer than usual, as they take a wait-and-see approach to current proceedings. Freight volumes will likely remain choppy as pre-tariff inventories are drawn down.”

The Capacity Index rose 4.0 points to 51.1 in March, up from 47.1 in February.

Vieth said steel and aluminum tariffs, reciprocal tariffs, and tariffs on China will directly add to the cost of tractors and trailers. “The increase in for-hire capacity in March was likely fleets planning ahead of equipment price increases,” he said. “While freight fundamentals don’t yet call for for-hire capacity expansion, the inflationary cost of tariffs may lead some carriers to pull deliveries ahead. Many, though, have taken a wait-and-see approach to capital spending.”

The Supply-Demand Balance dropped to 42.4 in March, from 51.1 in February, as freight volumes decreased and capacity increased.

“With Chinese New Year occurring later this year, volumes may have underperformed seasonality on calendar effects,” Vieth said. “Capacity in March was likely temporary, with carriers looking to get ahead of equipment price increases. While capacity is beginning to come out of the supply side, the trade war may significantly impact demand.”

ACT’s For-Hire Trucking Index surveys for-hire trucking service providers monthly. Results are reported as diffusion indexes, where a reading of 50 represents neutral activity.