Truck Spot Market Decline February 2024

March 7, 2024

Trucking Spot Market Hits a New Low: A Look at the Recent Trends

As we turned the page on February, the trucking industry witnessed a further downturn in the spot market, marking a new low since the onset of the pandemic in April 2020. Specifically, the number of load posts on the spot market plummeted to 598,674 according to DAT, a figure not seen since those early, uncertain days of the pandemic. This staggering 59% decline from the previous year underscores the continued mismatch between the availability of trucks and the demand for freight services

Weekly Observations and Yearly Comparisons: A Detailed Analysis

For the week ending February 24, there was an 8.6% decrease in weekly load posts when compared to the previous week.
When looking at the year-over-year data, load posts have fallen by 59%.
Despite these challenging conditions, carriers remain active in the market, although they face depreciating truck values and escalating operational costs. DAT’s Dean Croke suggests that a gradual decrease in carrier numbers might be on the horizon, with shifts in demand potentially serving as a pivotal factor for the market.

Load-to-Truck Ratios and Financial Strains: An Industry Under Pressure

The load-to-truck ratio currently hovers near pandemic lows at 1.02 loads per truck, indicating a significant surplus of capacity. Industry experts like Stifel’s Bruce Chan and Truckstop’s Brent Hutto have voiced concerns over this excess capacity and the consequent suppression of spot rates. This situation has put additional financial strain on owner-operators, who are grappling with inflation and soaring operating costs. Despite the grim short-term forecast, there is a silver lining as the market might correct itself with supply and demand becoming more balanced, which could breathe new life into spot rates.

With spot rates nearing historic lows, the industry is feeling the pinch from both inflation and heightened operational costs. This financial squeeze highlights the urgent need for a market adjustment to mitigate the pressures faced by trucking professionals.