Freight market downturn likely
Freight conditions are not expected to rebound in the near future, according to the OOIDA Foundation’s latest market update.
A number of “worrying signs” have started to emerge, according to data in the Total Spot Market Cycle Indicator – a measure of the total spot rate and three-year moving average.
“These metrics are showing unusual amounts of contraction for this time of year,” the Foundation said. “The only reasonable explanation for this is tariffs and – more particularly – the uncertainty surrounding trade. We expect this to only worsen unless more clarity emerges.”
Mack Trucks recently announced hundreds of layoffs citing tariffs as well as economic uncertainty.
The Foundation freight market report indicated that volume/demand are weakening, capacity is loosening and rates as well as operating costs are falling. Overall, the future outlook is negative, the Foundation said.
Van market
Demand was more favorable for carriers in the Northeast and Southeast regions. The largest decrease came in the Mountain Central region.
Spot rates mirrored demand, falling month-over-month.
Sales and inventory ratios moved in a positive direction, but wholesale trade data has a two-month lag. Tariffs are expected to negatively impact the current trend.
“We’ll have to see what the next couple months bring, as a potential trade war is ongoing,” the Foundation said. “We expect April’s data will show a stark change.”
Flatbed market
All but one region experienced an increase in demand. Only the Mountain Central region reported a decrease.
The primary driver for the increase was mining except oil and gas and cement and concrete product.
Housing starts contracted after rising the previous month. If tariffs remain in place, housing starts will continue to contract.
The 10-year U.S. Treasury Yield remained high, as did the median price for existing single-family homes.
Reefer market
Demand was down in most regions, with the largest decline in the South Central region.
Spot rates fell significantly month-over-month.
Volumes were considerably lower than 2019 levels, a bad indicator for freight demand.
The market continued to be plagued with persistent overcapacity. Tariffs could further exacerbate the issue by raising prices for farmers, the Foundation said.
Trucking market
A few more months of “brisk demand” will precede a tariff adjustment period, according to the Cass Shipment Index.
“The trade war is likely to extend the for-hire freight recession as higher prices reduce goods affordability and consumers’ real incomes,” Cass said.
Truck employment numbers were higher overall but down year-over-year.
New Class 8 truck sales increased, while new orders declined. Used sales eclipsed new sales for the 14th time in 15 months.
“The first quarter of 2025 has been defined by one word: uncertainty,” said Carter Vieth, research analyst at ACT Research. “Whether the slowdown in orders is a result of moderating economic activity, private fleets pausing expansion or a response to trade and policy uncertainty remains an open question.”
Diesel was down month-over-month and is one expense that may drop while any tariffs are in place.
C.H. Robinson said there could be a downturn in imports caused by inflated inventories and decreased demand.
The full OOIDA Foundation April freight market update is available online. LL