Q4 2024 freight market update: Key insights and recommendations for shippers and carriers

Updated November 7, 2024

As the end of the year approaches, logistics teams will need to begin preparing strategies and reviewing forecasts for 2025. The key to staying ahead of disruption and remaining competitive now and in the new year is to build and maintain a proactive, data-driven logistics program. Our latest Quarterly Market Update and Outlook Report shares data and insights from our experts around the impacts of leading economic and supply chain trends, helping logistics teams stay informed and prepared for potential volatility.

This quarter (Q4 2024), we took a close look at insights around supply and demand, and route guide performance in the U.S. truckload sector; the latest LTL market trends; and key factors impacting cross-border transportation.

U.S. trucking: Supply and demand remains the same; and routing guides are holding strong

Heading into the last part of 2024, the U.S. economy is showing signs of stabilization, but the freight market is still oversupplied. Although the gap has slowly been closing and both saw modest growth in September, supply has continued to outpace demand for the past 27 months.

In Q3, truckload demand rose by 0.5%, which was mainly driven by consumer spending and imports. Container imports increased by 1.7% in September, with a 14.4% increase compared to the previous year. Trucking employment remained flat year-over-year but continues a general downward trend. With weaker trailer and Class 8 orders, it’s possible for the trend to continue through the end of the year.

While the market is expected to tighten from October to December, routing guide compliance remained consistent across all modes. First tender acceptance rates remained flat at 92% in October, and routing guide compliance remained at 95%.​ Inflation over the primary carrier remains near zero, a good indication that shippers are minimizing risk and remaining protected from disruptions.

However, shippers should be prepared for the tides to turn in 2025. Demand could rebound next year even as excess capacity continues to exit the market, especially if strong tariffs are imposed, and the Federal Reserve continues to cut interest rates. As of November 2024, spot rates were 5% higher than their year-ago level, the highest year-over-year increase since February 2022.

Our recommendations:

• Maintain high FTA by establishing strategic relationships with key providers in your network, and symbiotic, long-term goals.
• To navigate volatility, collaborate with strategic carriers for cost and price transparency within your network, create an action plan to address out-of-process lanes.

LTL market continues slow rebound even with volume declining

Demand for LTL services continues to be slightly lower than last year, with most carriers having excess capacity. In many cases, carriers in Q3 stated they could handle volume increases ranging from 5% to 20%. Tonnage is still lagging and in the negative, which may slow rates and flow moving into early 2025.

Despite weak demand, carriers are still seeing favorable financial results in the LTL space by leveraging and investing in technology and internal efficiencies and processes. Carriers are also being more selective in what opportunities they invest in to drive yield, with some opting to exert more price control. That said, with the lack of overall volume, many larger carriers have revised Q4 revenue forecasts down by 10% to 15%.

Our recommendations:

• Carriers are seeking strategic growth partners with a high degree of tech enablement to help drive cost-out initiatives. Tools like Uber Freight’s LTL solution help shippers and carriers streamline the LTL procurement process.
• Continue to prioritize best practices for long-term success, which include productive carrier collaboration, data-driven pricing strategies, and packaging improvements.
  Use Q4 bids to lock in competitive LTL pricing for 2025, ensuring the best combination of rate certainty and competitiveness.

Cross-border shipping: Continue to plan and implement efficiencies to improve Mexican and Canadian operations

Cross-border shipping between the U.S., Mexico, and Canada continues to grow. But for supply chains to run efficiently, shippers and carriers need to be aware of the latest trends in Mexico and Canada.

In Mexico, transload capacity for northbound loads remains tight due to driver shortages. According to the International Road Transport Union, there were 56,000 unfilled driver positions in Mexico in 2023. By 2028, this could increase to at least 106,000, which could significantly impact the boom in nearshoring investment and projects. Cargo theft and driver shortages also continue to be the most pressing challenges for Mexico’s transportation industry.

In Canada, trucking activity has continued to balance out, primarily due to a gradual reduction in capacity. While the Canadian economy experienced supply chain disruptions in Q3, cross-border trade remains strong, driven by outbound loads to the U.S. Inbound loads from the U.S. are declining, primarily due to the weakened Canadian dollar.

Our recommendations:

To successfully navigate the Canadian market, be sure to issue full network RFPs and secure capacity at current rates as the market starts to re-balance​.

• Seek to implement network efficiencies with technology solutions. For example, Uber Freight’s Canadian LTL services move more than 10,000 pallets out of the Greater Toronto Area per week. Leveraging an innovative collaborative shipping model, it combines shipments from multiple shippers into optimized, multi-stop routes, reducing unnecessary stops and costs while improving overall shipment performance.
• Prioritize fighting cargo theft in Mexico with fraud prevention solutions including real-time shipment tracking to catch suspicious activity. It’s also a good time to budget for 2025 through RFPs and lock rates and capacity.

These are just a few of the findings from our new report. For a comprehensive outlook of what logistics teams can expect this quarter, including an overview of global supply chain events, see our full Q4 Market Update and Outlook Report.

*All data is generated by Uber Freight internal indices using a weighted combination of truck and driver availability for supply, and manufacturing output, goods consumption, imports and exports for demand.