Hello Owner-Operators and Carriers,

There is a lot of talk about a recession.  What is a recession?  A recession is the economy shrinking for consecutive quarters. While the US is not technically in a recession right now, the trucking industry is. Rates are going down fast in both contracted and spot worlds, and I anticipate further declines when country enters into a recession. 

Let's walk through a few slides and see what is happening with the numbers. 

First, here is the spot market index by trailer type: 

The national VAN average is now down to $2.47/mile.  It was $2.68/mile four months ago and much higher last fall.

The next chart breaks the national average van rate down by region of the country. 

Are you operating where the money is, or are you operating where the rates are poor?  Having this knowledge will help you make better decisions.

Right now, running shorter freight will help you balance out some of the downward pressure on RPM.  Keep in mind, these averages include ALL freight, long and short.  This tells me the long haul rates are sliding very fast, as short hauls have held up to a certain degree.  

Why are we, TrueNorth, pushing dedicated right now?  The more we have our drivers on contracted freight, the less exposed you will be to the declining spot market.  As we hit the 1st quarter, it will get ugly.  So the race is on to get on contracted freight.  Come Q1, the brokers will put all freight that isn't committed onto spot, and for those in spot, it will be the race to the bottom.  

The chart below shows that contract rates are holding much better than spot.

If you look at the ratio of loads to trucks, we are essentially in equilibrium: for every one truck, there is one load.  This graph shows that we are in a "normal" environment.  When Q1 2023 hits, there will be more trucks than freight, and rates will go down.  Again, look at alternate ways now to stay running.  IF you wait until Q1, you will be stuck in spot and will have little to no chance of getting contracted lanes.

It is my opinion that we are in more of a normalized market right now even though it may feel much worse.

What do you mean things are normal?  I feel we are in a blood bath.  

If you look at the ratio of loads to trucks, we are essentially in equilibrium: for every one truck, there is one load.  The next graph shows that we are in a "normal" environment.  When Q1 hits, we'll see more trucks than freight, which will drive rates further down. That's why we need to look now at alternate ways to stay running, or we will be stuck in spot with little to no chance of securing contracted lanes.

Finally Fuel.  What can you expect?

Fuel prices have peaked, and forecasts show continued decline through next year.  

 What are we doing at TrueNorth to help all of you from the sales front?

• We are deepening our relationship with brokers. I'm traveling nearly weekly to make sure our brokers know they have access to ALL owner operators at TrueNorth.
• We are opening up dedicated runs
• We are working to get contracted lanes
• We are piloting a Full-Service Planning program to build revenue consistency and more regular hometime.
• With our API integrations (connecting to load boards through our tech), we are getting better rates than what you can get directly from individual load boards

If you like what we're doing, start a free trial.  We look forward to helping you build your business!

Sincerely,

Jeff Resch

GM of Demand, TrueNorth

About TrueNorth

Whether you own a small fleet or a single truck, TrueNorth makes it simple to run your business and earn more money. With our one-stop-shop platform, you'll get the resources typically only available to large carriers: aggregated load board, dedicated freight options, steep fuel discounts and integrations with most factoring companies.