Less-than-truckload carriers are anticipating the end of a two-year industrial recession to bring a much-needed increase in volume and a better freight mix. A positive shift will also help fill terminals acquired after Yellow Corp.’s exit.
The shutdown of Yellow (OTC: YELLQ) in July 2023 freed up roughly 8% of the market share, temporarily alleviating the ongoing freight recession. However, the extra volume was quickly absorbed, and the industry is again facing significant declines.
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This week, many publicly traded carriers will report volume and pricing metrics for November (and final numbers for October). Despite this, the start to the fourth quarter was challenging, with November manufacturing data showing slight improvement.
In October 2024, carriers like ArcBest (NASDAQ: ARCB), Old Dominion Freight Line (NASDAQ: ODFL), and XPO (NYSE: XPO) reported high-single-digit year-over-year tonnage declines, affected by the cyberattack on private carrier Estes and two major hurricanes.
Saia (NASDAQ: SAIA) was an exception, with a 6.5% year-over-year increase in tonnage by taking on retail-related freight and shipments from large national accounts. However, the less favorable freight mix has slightly impacted margins.
Yellow’s freight mix leaned more towards retail customers with lighter shipment weights, contrasting with denser, industrial loads. Most carriers indicated on third-quarter calls in late October that year-over-year tonnage comparisons are expected to improve throughout the fourth quarter.
Prepared by: Jacky
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