The report shows mixed results in a market that is generally favoring shippers. The quarterly outlook report predicts a continued downward trend in truckload (TL), increases in parcel, and “surprising” strength in less-than-truckload (LTL). TL rates are expected to decline, while surcharges and general rate increases (GRIs) will drive higher rates for parcel and LTL, according to the report.
The index is published by Cowen Research and third-party logistics services (3PL) provider AFS Logistics.
“Seven interest rate hikes since March of last year and continued inflation have taken a significant bite out of economic demand,” AFS Logistics’ CEO Tom Nightingale said in a press release announcing the Q1 report. “While the index does not show a uniform decline across all modes, looking deeper shows the effects of macroeconomic conditions playing out, with carriers competing for more limited demand while searching for ways to claw back revenue.”
Key findings from the report include:
The Cowen/AFS Freight Index is based on data associated with $11 billion of annual transportation spend by AFS customers across all modes of transportation; it uses past performance and machine-learning to generate predictions for the remainder of the quarter, set against a baseline of 2018 rates for each mode.