The freight market continues to tread uncertain ground as we move into summer. From shifting capacity trends to diverging equipment performance, the industry sits at a crossroads, caught between soft demand signals and the potential for a tightening supply-side reset. Here’s what’s driving the latest change and what carriers and shippers should watch closely.
Utilization Slides, But a Rebound May Be Brewing
Ongoing softness in long-haul freight is pulling down active truck utilization, signaling persistent overcapacity in the near term. However, the current drop may hold the seeds of a turnaround. If rates and volumes remain low through the second half, an accelerated driver and carrier exit could tighten supply, potentially setting up a stronger 2026.
Sector-by-Sector Demand Snapshot
Year-over-year freight demand is marginally positive, with total growth forecasted at just +0.1%. Segment performance is uneven:
- Flatbed, tanker, and bulk freight remain bright spots.
- Dry van volumes are facing headwinds, pressured by slower movement in food, consumer goods, and automotive, with a projected decline of –1.3%.
- Refrigerated freight remains neutral.
- Despite recent declines in industrial production, flatbed demand remains relatively resilient, holding at +1.9% year-over-year growth.
Truckload Rates Show Strength Despite Soft Volume
Despite the pervasive softness in volumes, the truckload pricing environment is exhibiting an unexpected level of resilience. FTR’s forecast indicates overall truckload rates are set to rise by +2.0% year-over-year.
A deeper dive reveals that spot rates are expected to climb +1.8%, while contract rates are leading the charge at +2.2%. This positive momentum is primarily attributable to the robust performance of the flatbed and specialized segments, which are effectively offsetting and outpacing the weaker pricing trends seen in categories like dry van.
Trucking Conditions Index Points to a Flat Near-Term
The Trucking Conditions Index (TCI) posted a –0.81 reading in April, as falling freight volumes outweighed neutral rate activity. Preliminary May data appears modestly more favorable, but the overall market outlook remains neutral through the rest of 2025.
A more favorable shift is projected for early 2026, driven by potential supply contraction and a return to tighter conditions.
Tariff-Driven Disruptions Have Stabilized, for Now
While earlier tariff escalations had shaken global freight patterns, recent trade stabilizations—particularly the short-term U.S.–China deal—have helped reduce volatility. The freight sector has largely absorbed the tariff environment over the past several months.
Any rollback in trade restrictions is expected to act as a slow-moving tailwind rather than an immediate market disruptor.
What Shippers Should Watch Now
- Driver and fleet exit: Be aware of signs of capacity attrition, which could tighten the market more quickly than expected.
- Segment-level rate moves: Flatbed and specialized freight are leading; dry vans remain soft, so strategize accordingly.
- Policy & tariffs: While currently stable, any changes could gradually shift sourcing and demand patterns again.
In 2025, the freight market is expected to be a balancing act between declining utilization and stable pricing. Although the current freight environment may seem calm at first glance, underlying dynamics could quickly shift the market.
Carriers that closely monitor changes in supply and respond swiftly will be in the best position. Meanwhile, shippers should take advantage of this period to secure competitive contracts, particularly in weaker lanes.