Freight shippers are enjoying a buyer’s market at the moment. There’s widespread overcapacity in the trucking industry, forcing carriers to lower prices in an attempt to keep their trucks full. For now, shippers can find low transportation rates relatively easily.
As with any cyclical industry, this will all change. Soon, carriers will be dictating rates and shippers will be competing for trailer space, paying much more for transportation than they are right now.
Why is this happening? And when can shippers expect to pay higher rates?
There are 9 major factors that will determine the severity and timing of the rate hikes.
When energy prices rebound, it will increase operating costs for trucking companies. In response, they will have to increase fuel surcharges to cover their expenses. Carriers make more profit from fuel surcharges when fuel costs are high, so the surcharge increase won’t be proportional.