The latest U.S. Bank Freight Payment Index revealed that the U.S. truck freight market contracted significantly during the first three months of 2024. Spending by shippers decreased 27.9% in Q1/24 compared with the same period in 2023 and was down 16.8% compared to Q4/23. Meanwhile, shipments dropped 21.6% from a year prior and 7.8% from Q4/23.
“While there was hope for a freight market turnaround to start the year, our data shows that the challenges continued,” Bobby Holland, director of freight business analytics at U.S. Bank, said. “Nationally, this was the eighth straight quarter of year-over-year volume decreases and the fifth straight with a drop in spending.”
The U.S. Bank Freight Payment Index regional data shows how widespread the current challenges are for the truck freight market. With the exception of the Southwest, which had a quarterly increase in volume, all regions had significant declines in shipments and spending. The most severe contraction was in the Northeast, where spending dropped 34.8% year-over-year and shipments fell 33.9%.
“Spending fell disproportionately to the drop in volume, which suggests downward rates pressure to start the year,” Bob Costello, senior vice president and chief economist at the American Trucking Associations, said. “Truck capacity remained above the amount of freight available. The degree to which this mismatch shrinks or expands will be important to watch throughout the year.”
National Data
Shipment
Linked quarter: -7.8%
Year over year: -21.6%
Spending
Linked quarter: -16.8%
Year over year: -27.9%
Regional Data, West
Shipments
Linked quarter: -10.6%
Year over year: -23.0%
Spending
Linked quarter: -19.9%
Year over year: -30.6%
Overcapacity, bad weather and consumers spending less on goods all impacted the truck freight market in the West. This was the third time since the height of the pandemic that the region had annual and quarterly declines in both spending and volume.
Southwest
Shipments
Linked quarter: 8.9%
Year over year: -12.8%
Spending
Third quarter: -16.5%
Year over year: -29.2%
The only region to have higher volumes, shipments in the Southwest were up 8.9% over the previous quarter. However, they were down -12.8% year over year. Weaker factory output in the region was partially offset by higher cross-border freight from Mexico.
Midwest
Shipments
Linked quarter: -9.5%
Year over year: -18.5%
Spending
Linked quarter: -15.4%
Year over year: -25.9%
Shipment volumes dropped for the fourth consecutive quarter in the Midwest. A slowdown in auto sales and softer manufacturing activity contributed to the declines.
Northeast
Shipments
Linked quarter: -17.5%
Year over year: -33.9%
Spending
Linked quarter: -23.8%
Year over year: -34.8%
The Northeast had an extremely difficult quarter, with the largest declines of all five regions. Bad winter storms and softer retail sales were two drivers of the major contractions in volume and spending.
Southeast
Shipments
Linked quarter: -9.0%
Year over year: -24.4%
Spending
Linked quarter: -13.8%
Year over year: -25.0%
The Southeast experienced its 11th consecutive quarter where shipments contracted sequentially. However, the region had the smallest decline in volume of the four regions that contracted and the smallest decline in spending.
The full report is available online: U.S. Bank Freight Payment Index.
