Truck freight volume continued to contract in Q1, US Bank says

Truck freight volume continued to contract nationwide during the first quarter, despite major increases in the southwest U.S. region, according to the latest U.S. Bank Freight Payment Index.

Specifically, the volume of freight shipments moved via truck declined in the first quarter of 2023 by 6.1% year-over-year, marking the fourth quarter in a row where volume has contracted on an annual basis. That result aligns with other recent reports on falling freight volumes across all truck types in recent months, such as ACT Research’s For-Hire Trucking Index and FTR’s Trucking Conditions Index (TCI).

The drop was most intense in the Southeast (16.1%), West (14.1%), and Northeast (13.8%) regions. Shipments also fell year-over-year in the Midwest, dropping a smaller amount—just 2.4%—but showing a persistent decline as it dropped for the 12th straight quarter.

In contrast, shipments in the Southwest region increased 14%, the region’s largest year-over-year increase since early 2018. Reasons for that trend include a nearshoring trend to source goods from Mexico instead of overseas, and a shift of container imports away from West Coast ports, the report said.

“This quarter was a prime example of how important it is to examine regional data when assessing truck freight shipments in the U.S.,” Bobby Holland, director of freight data solutions at U.S. Bank, said in a release. “Boosted by growing truck-transported trade with Mexico and increased activity at the Port of Houston, truck freight activity in the Southwest region is markedly different than what we’re seeing in other regions.”

Meanwhile, spending on truck freight fell nationwide just 0.3% year-over-year driven by an 8% year-over-year spending drop in the Midwest. Spending rose in all other regions, including by 16.7% annually in the Southwest and 7.8% in the Southeast.

“It’s clear that capacity is not uniform across the country,” Bob Costello, senior vice president and chief economist at the American Trucking Associations (ATA), said in a statement. “The spending data we’re seeing in the South is more evidence that there is real trucking supply tightness there, while the Midwest is experiencing the opposite.”