The year 2018 is near, and with it will come rate increases for some carriers. Shippers are paying premium prices for freight, as there are high volumes of shipments coupled with reduced capacity. These factors are causing an increase in rates for shippers and some new record highs for those in the transportation industry.
The spot market for reefer rates achieved a three-year high in mid-November, with an average rate of $2.40 per mile. In October, rates for mid-sized freight brokers hit a two-year high, netting a per-load profit of almost $62.00. Another two-year high was noted for revenue per employee in the transportation sector; it was reportedly 183% higher than in October 2016—all according to DAT.com. As of November, the national average for spot market van rates was well on its way to hit a three-year high.
In 2017, these record highs have been a result of increased rates for shippers. This is also true in the LTL market. Several of the larger LTL carriers took rate increases in mid-2017. Some of these carriers include ABF Freight (May), Estes Express (June), Oak Harbor Freight Lines (July), AAA Cooper (July) and Old Dominion Freight Lines (August). Two of the largest LTL competitors, FedEx Freight and UPS Freight, will be implementing 4.9% rate increases before 2018.
Prepare for the new year by knowing what increases are coming. It is believed that increases will continue in the spot rate market, in LTL carrier general rates and in fees within carriers’ rules tariffs.