Commercial carriers are optimistic about growth in volume and rates this year, despite rising fuel and equipment costs that are squeezing profitability, according to the latest Bloomberg-Truckstop.com survey, which polled owner-operators and small fleets.
“Bullishness has stayed at a historical high for carriers despite recent spot-market volatility,” said Lee Klaskow, senior freight transportation and logistics analyst at Bloomberg Intelligence. “The past three months have been a tale of the haves and have-nots when it comes to volume growth. Load growth could trend higher sequentially into May, providing some support to spot rates.”
The survey shows that owner-operators remain optimistic about demand, with 72% of respondents expecting load growth over the next six months vs. 71% in the fourth quarter of 2021 and Q1 last year. Temperature-controlled carriers were most optimistic, with 77% expecting higher volume, followed by 74% of flatbed carriers who are benefiting from a strong housing market.
Fewer carriers are optimistic when looking at rates, according to the survey. About 55% of respondents expect spot rates (excluding fuel surcharges) to rise in the next six months vs. 59% in Q4 2021. About 14% of carriers expect rates to decline over the next three to six months, in line with historical averages. Only 2% of truckers who were polled expect rates to drop quickly this year and another 32% expect them to moderate slowly.
More carriers are hauling fewer loads, the survey found. Truckload spot demand rose 4.3% year-over-year in Q1 this year—a seventh straight quarterly gain after dropping 16% in the second quarter of 2020 as the pandemic began. Median volume growth was closer to flat, given the wide divide between those carriers experiencing growth and those not moving as many loads. About 37% of respondents hauled more loads vs. the first quarter last year. About 32% recorded a drop vs. 25% in Q4 as the number of carriers who experienced flat volume decreased to 31% sequentially from 38%.
Rising fuel costs are a concern for carriers, the survey also discovered. About 56% of carriers said that higher fuel costs are the industry's biggest challenge. Lower rates are the second-biggest concern in 2022 at 21% of the sample, followed by the weakening economy (16%). Despite these concerns, about 69% of those surveyed anticipate the truckload market will remain tight this year.
Skyrocketing fuel prices top of mind for fleets
Price pressure on commercial fleets large and small continued this week as the nationwide average for diesel fuel rose again 5.9 cents to $5.16 per gallon, according to the U.S. Energy Information Administration.
Diesel has eased a bit in recent weeks since Russia’s invasion of Ukraine, but never has fallen below $5 per gallon. Meanwhile, the nationwide average for the week of April 25 sits closer to the highest mark the fuel has ever reached, $5.25 per gallon, which EIA reported the week of March 14.
Nationwide, trucking’s main fuel is now more than $2 above—$2.036—its price of a year ago.
“Carriers polled for this survey remain relatively positive despite the headwinds facing the industry from rising fuel and equipment costs,” Kendra Tucker, CEO of Truckstop.com, said in a release announcing the results of the survey. “We keep carriers’ businesses moving and their bottom line growing by providing them with the technology solutions they need to navigate these industry fluctuations, which is especially crucial during times when the market changes so drastically.”
The Bloomberg-Truckstop.com survey sampled 126 dry-van, flatbed, temperature-controlled and specialized/diversified carriers. Of the respondents, 60% operate just one tractor.