A majority of carriers reported that average freight rates in the past quarter continued to rise, according to the recent First Quarter Business Expectations Survey completed by Transport Capital Partners LLC (TCP). The survey found that most of the rate increases were less than 5%, however, larger carriers reported seeing more rate increases in the 1-5% range than did smaller carriers. Smaller carriers reported more rate increases in the 5-15% range. Eighty percent of respondents also said that accessorials as well as rates would be on the table in their renegotiations with shippers.
“Not surprisingly, the largest category targeted by carriers was fuel surcharges,” said Richard Mikes, TCP partner. Thirteen percent of respondents said this would be a topic of discussion with shippers in August; 30% of carriers responding to the current survey said it would be a point of negotiation, Mikes noted.
Seventy percent of respondents also said fuel surcharges are not covering costs. This was up substantially from the first quarter last year when half of the survey respondents reported that surcharges were not covering costs. “This is not surprising given that during the time period, the [Dept. of Energy] reported fuel prices increasing on a daily basis and up 70-plus cents over the year,” said Mikes.
Detention times were the second most mentioned accessorial — listed by 15% of the carriers.