Truck freight volume and spending in the second quarter of 2023 declined by the highest levels since the early days of the pandemic, the latest U.S. Bank Freight Payment Index revealed. Spending by shippers dropped 10.9% compared to the second quarter of 2022 while shipment volume dropped 9%, according to a statement from the Minneapolis-based bank.
“Trucking is in the midst of a significant slowdown,” said Bob Costello, senior vice president and chief economist at the American Trucking Associations.
“Weaker consumer demand for goods and a slowdown in manufacturing activity and housing starts are having a major impact on the industry – especially carrier operations.”
Nationwide shipment levels have now decreased for five consecutive quarters. In the second quarter, volume dropped most in the Northeast (27.1%) and Southeast (12.6%) year-over-year. The Southwest continued to be a bright spot, with shipments increasing 14.8%.
“In the spot market, we’ve been observing for a while sharp spending drops caused by lower volumes and increased capacity. This trend has now solidly penetrated the contract freight market,” said Bobby Holland, director of freight business analytics, U.S. Bank.
“Nearly every category we track – both nationwide and regionally – contracted in the second quarter.”
The Midwest region had the sharpest spending drop in the second quarter, 18.7% year-over-year. The Northeast and West also experienced double-digit spending declines, dropping 10.9% and 10.2%, respectively versus the second quarter of 2022.
The bank's regional data found:
Truck freight spending levels have now contracted year-over-year for two consecutive quarters. With spending at all-time high levels for the preceding six quarters, the recent drops brought spending activity back to its relatively strong levels of mid-2021.