The freight industry showed signs of life, bucking a trend of weak performance that began in the second quarter of 2022, according to third quarter 2023 data from the Transportation Intermediaries Association (TIA). However, sluggish freight volumes and trucking overcapacity will likely keep future results tepid until at least the back half of 2024.
“Our forward-looking data has had us bracing for continued weakness in the freight economy,” says TIA president and CEO Anne Reinke. “However, the surprising strength we saw during the third quarter goes to show that the market can still outperform forecasts. Our members continue to be incredibly resilient and have made the most of less-than-stellar conditions in recent quarters.”
- The freight economy, which the report calls the GDP Goods Transport Sector, rose 6.5% quarter over quarter, breaking a 5-quarter streak of negative or nearly negative quarter-over-quarter growth. That growth aligned with a 4.9% increase in U.S. real gross domestic product (GDP) during the third quarter.
- TIA members saw quarter-over-quarter declines in total shipments (-2.2%) and total revenue (-0.2%), but an increase in invoice amount per shipment (2.1%). Members saw double-digit percentage declines in all three metrics year over year.
- In terms of sector performance, intermodal (IM) and less-than-truckload (LTL) recorded quarter-over-quarter gains in total shipments, while truckload (TL) saw a decline in total shipments. All three segments posted mid-single-digit to double-digit year-over-year percentage declines in total shipments.
- A key driver of the freight economy’s slowdown is trucking capacity, which grew significantly between 2020 and year-end 2022.
- Consumer spending continues to be a metric to watch, given its strong influence on the freight economy.
“We’re looking at tough year-over-year comparisons for brokers given that the third quarter of 2022 was a strong one for members,” says Mark Christos, TIA chair and chair of the market report. “That being said, the positive results detailed in this most recent report are encouraging for members as we brace for further headwinds until mid-2024.”