A 2024 Look Into The Future of the Freight Market

Freight markets are known for their cyclical nature, marked by periods of growth followed by market corrections. Currently, the freight market is navigating one of those extended correction phases. Our very own Thom Albrecht, Chief Revenue Officer at Reliance Partners, recently joined FreightWaves’ WHAT THE TRUCK?!? podcast to discuss what might be on the horizon for the freight industry.

Uncertainty in the Freight Market

As Thom noted, “Since the Fourth of July, we’ve seen a shift back into uncertainty.” With the upcoming presidential election and the Federal Reserve signaling potential interest rate cuts, many in the industry are waiting to see how these factors play out. Albrecht observed that freight volumes have slowed noticeably in recent weeks, contributing to the market’s ongoing correction phase.

Election Cycles and Freight Market Patterns

Analyzing historical data from past election years, Thom highlighted patterns from 2003-2006, 2014, and 2018, where strong freight markets were followed by extended corrections. These corrections typically outlast the recovery phases. For instance, after the solid freight period of 2014, the recovery lasted 17 months, while the correction took 21 months—a similar pattern emerged in 2018.

The most recent strong freight cycle, from July 2020 to June 2022, aligns with these historical trends, as we’ve now passed the two-year mark of a correction. According to Thom, “The market could reach equilibrium as early as October 2024, but there’s also a possibility that this correction might extend until February or March of 2025.”

Carriers and the Path Forward

For carriers, the key is endurance. Margins are slim, and the industry is closely watching how the upcoming peak season and consumer behaviors play out. Early consumer spending trends are promising, with many starting their holiday shopping earlier than usual, which could provide much-needed momentum to the freight sector.

Thom optimistically notes that once the market does reach equilibrium, “It doesn’t usually flip immediately. It stays steady for 4-6 months before we see a shift. Once the market flips, it’s expected to move quickly.”

While the timeline remains uncertain, Reliance Partners will continue to provide guidance and support to help carriers navigate these challenging times.

Learn more about how Reliance Partners is helping our clients manage through these market conditions by visiting Reliance Partners.

Check out the full article from our friends at FreightWaves.