Trucking rates are often an unpredictable element of freight transportation. Because they are directly influenced by the market, trucking rates can be considered a reliable barometer of broader economic conditions. In times of economic prosperity, the surge in consumer spending propels freight demand, driving up rates as capacity becomes strained. Conversely, during economic downturns, reduced consumer spending can lead to overcapacity, prompting carriers to adjust their pricing strategies.
In this guide, we’ll explore everything shippers need to know about trucking rates. As the soft freight market persists, shippers are seeing new opportunities to lock in lower rates and eliminate unnecessary trucking expenses. Shippers can achieve complete visibility into their carrier selection process and secure competitive rates by leveraging a transportation management system (TMS) and other digital logistics solutions.
Instead of overpaying for a delivery, a TMS can be the difference that ensures you book a fair and reliable rate each and every time. Explore Uber Freight’s offerings today.
Trucking rates are the prices that carriers charge to transport freight from one location to another. They depend on various factors, such as freight supply and demand, fuel costs, distance, type of cargo, and seasonality. Carriers typically list trucking rates as “per mile,” so it’s important for shippers to know the distance between their starting point and delivery destination to calculate an accurate estimate.
The type of truck needed to carry the load is equally important. Dry vans, reefers, and flatbeds all have different benchmarks, so shippers need to consider which type they need to get the most bang for their buck.
Dry vans are what most people imagine when thinking of freight trucks. They are used to transport dry goods in a non-temperature controlled trailer. As of August 2023, the average spot rate for a dry van was $2.07 per mile, or $2.56 per mile as a contract rate.
Flatbed freight trucks are flat, exposed trailers ideal for transporting large, heavy, or irregularly shaped loads that don’t need to be enclosed or don’t fit in the confines of a traditional enclosed dry van. As of August 2023, the average spot rate for a flatbed truck was $2.49, or $3.18 per mile as a contract rate.
Refrigerated trucks, also called reefers, are climate-controlled vehicles often used to transport produce, pharmaceuticals, and beauty products. Maintaining a set temperature means that reefers typically have higher per mile rates. As of August 2023, the average spot rate for a refrigerated truck was $2.47 per mile, or $2.95 per mile as a contract rate.
National average trucking rates are constantly fluctuating, so it’s important for carriers to keep a close eye on how the market evolves as well as understand the factors that can cause these shifts.
Spot market rates are subject to change in real time, depending on freight supply and demand. An increase in rates may be driven by a number of persistent, industry-wide challenges in trucking, such as driver shortage, capacity constraints, and rising operational costs. Spot rates are typically lower than the contract rates, which are negotiated between shippers and carriers for longer-term agreements. While contract rates are also influenced by economic outlook, freight volumes, truck utilization, and inflation, they are typically more consistent. Shippers can take advantage of contract rates to avoid market volatility and ensure they have capacity available at a stable rate when they need it.
Over the next few months, shipping rates will be influenced by Yellow’s recent bankruptcy filing, disinflation in the US economy, and potential stabilization of the spot market.
LTL carriers are currently working to absorb Yellow’s volume after the carrier ceased operations in July. Since the LTL market in 2023 had naturally experienced a 10% drop in volume from its 2021/2022 highs, Yellow’s previous market share (9%) was more easily absorbed. However, the loss of Yellow’s services ultimately eliminated all excess supply in the process. Assuming no unexpected increase in demand, we anticipate it will take several months for the market to adjust to the shock.
All carriers are in the process of ramping up capacity in order to take over Yellow’s volume, driving an increase in costs. Yellow was previously the lowest cost national carrier—and its shutdown is expected to drive prices even higher.
After a few years of pandemic-driven demand highs and inflation, the freight market is beginning to normalize. In June 2023, year-over-year inflation fell by 100 basis points, a drop from 4% to 3%. Energy prices, which tend to drive year-over-year trends, fell by 16.7% over the last 12 months. But, it will be a long journey to reach full market stabilization. Core inflation, which excludes food and energy, is still running at 4.8%, significantly above the Federal Reserve System’s 2% target.
Spot rates change based on freight market conditions. Though the rate difference fell by 0.9% since this time last year, it is still high compared to historical values. Supply growth should moderate through the end of the year as carriers adjust to thinning contract margins. Spot rates did see an increase through May and June, but these increases fell short of seasonal expectations, indicating some market stabilization.
For further reading on current market conditions, check out Uber Freight’s Q3 Market Update. Shippers can learn more about the factors affecting trucking rates and immediate steps they can take to prepare for Q3 and beyond.
Freight trucking rates are meticulously calculated through a dynamic process that accounts for a number of factors. These variables work together to create a comprehensive pricing structure that accurately reflects the complexities of modern freight transportation.
Initially, the distance between the origin and destination serves as a foundational parameter, influencing the baseline cost due to fuel consumption, driver wages, and vehicle maintenance. Longer distances often result in higher rates due to increased fuel, maintenance, and labor costs associated with longer journeys.
The weight or volume of the cargo being transported directly impacts the operational costs of transporting goods. Heavier loads necessitate more fuel consumption, increased wear and tear on the vehicle, and potential limitations on the amount of cargo that can be transported in a single trip, all of which contribute to higher rates to cover these additional expenses. Larger, bulkier items may occupy a significant amount of space, potentially limiting the overall capacity for other shipments and affecting the carrier’s ability to optimize their routes.
The type of cargo being shipped and its classification according to industry standards (such as the National Motor Freight Classification) also play a role in rate determination. Different types of cargo have varying levels of difficulty in handling, potential for damage, and industry-specific requirements, which can affect pricing.
Other elements, including equipment, delivery urgency, prevailing fuel prices, tolls, and any supplementary services required, can also impact rates. Uber Freight’s algorithm adjusts in real time to fluctuations in the market, allowing shippers to access current rates they can lock in immediately—without risk of fluctuations down the line.
Uber Freight’s pricing algorithm accounts for factors like the day of the week, time of day, weather, and even seasonality. We also make sure to consider how quickly loads are being booked. If more loads are booked than normal, prices may decrease. If fewer loads are being booked than normal, prices may increase. Learn more about how Uber Freight’s pricing works.
Using the factors that affect freight trucking rates, shippers can estimate how much it will cost to deliver a specific load.
For best results estimating a trucking rate, shippers can request and compare quotes from different brokerages and carriers.
Shippers looking for immediate information and results can leverage Uber Freight’s instant quote tool, which accurately calculates rates based on type of shipment and pickup and dropoff zip codes. The quote you receive is based on up-to-date market trends. If you sign up for our Shipper Platform, you can lock in that rate instantly. Unlike traditional load-booking processes, no changes can be made to the rate once you secure it—the rate you book is the rate you pay.
Securing competitive trucking rates is crucial for shippers of all sizes to keep costs down and protect their bottom line. Digital tools can help businesses find the best rates, regardless of shipment type. Using Uber Freight’s Shipper Platform or TMS, shippers can access rates from multiple carriers, lock them in ahead of time, and build fruitful, long-standing relationships with their carrier partners and our logistics experts.
Shippers should plan in advance to gain additional flexibility in rates and carriers. Last-minute shipments can lead to rush fees and limited carrier availability, potentially driving up costs. By planning ahead, you can explore different carrier options, negotiate effectively, and secure a better rate.
Using Uber Freight’s lane explorer tool, shippers can take a more proactive, strategic approach to their transportation process. It allows shippers to lock in rates up to two weeks in advance. They can even see rates across a 14-day window to select the best possible carrier for their shipment.
By comparing offers from different providers, shippers can gauge the market rate and be more selective. While the lowest quote might not always be the best option, shippers have the flexibility to evaluate other important variables like carrier reputation, service quality, and additional services provided. Weighing costs and benefits, shippers can choose the rate that offers them the best bang for their buck depending on the shipment details.
As one of the largest freight networks in the country, Uber Freight offers shippers access to multiple, instant carrier spot and contract quotes as part of our suite of shipper solutions, including our TMS. Shippers can choose from our network of carriers of all sizes across the country in our Shipper Platform or TMS—or collaborate with our team of experts to find the right fit for them.
Building strong relationships with carriers can lead to more favorable rates over time. Regular shipping needs or a consistent volume of freight can indicate to carriers that you are a valued customer. Open communication, transparent expectations, and reliable payments help establish trust and loyalty with your shipping partners.
Uber Freight’s robust network of carriers on our platform wasn’t built overnight. Our team of experts has long-standing relationships with a variety of carriers. By deploying our managed transportation services, Uber Freight’s team becomes yours, allowing you access to transparent carrier rates.
Small and mid-sized businesses can also take advantage of Uber Freight’s network. Our rate lock tool allows shippers using the Shipper Platform to secure the same transparent rates as larger enterprises with a short-term commitment and the flexibility they need.
Ready to take advantage of transparent carrier rates to drive your business forward? Uber Freight’s offerings connect you with a vast network of carriers, ensuring access to up front trucking rates that align with your budget. With accurate, real-time quotes and the power to compare options, Uber Freight empowers you to make informed decisions, optimize your logistics, and secure the best rates for your shipments. Sign up today to get an instant quote.