“As we round out the first half of this year, the freight market continues to remain stable and in shippers’ favor. But a market turn could be on the horizon,” says Uber Freight in its latest market outlook report.
With the year’s first half done and dusted, there is good news for the rest of 2024. “Consumer spending has recovered from a winter slowdown, and the manufacturing sector has expanded for the first time in 16 months—factors illuminating a resilient economy,” says the freight forwarder.
However, it warns that a “market turn” will still be on the cards later this year. It anticipates “spot-to-contract rate spread normalizing,” and carriers are still busy rightsizing their headcount.
What should businesses do? “Now is the time to build proactive, data-driven logistics strategies to ensure your team is prepared to address future disruption,” advises Uber Freight.
A tight market lies ahead
In its latest quarterly report (Q2 market update), Uber Freight highlights that while cost and capacity pressures are easing, the market could still “tighten” later this year.
For shippers planning their budgets for the next few months, Uber Freight says: “The state of spot and contract rates should be of particular interest to shippers.” Spot and contract rates fell from February to April, while contract rates “remained flat” and dropped 14% year-over-year.
“Historically, when contract rates fall, carriers reduce headcount, and eventually shippers could face rising spot rates and lower First Tender Acceptance (FTA) rates.”
Uber Freight recommends shippers “build strong, productive relationships at lane level,” knowing that carriers are “more likely” to accept a tender if the tender has been in place for longer. Another tip is to “improve visibility”. How can that be done? By developing a plan to integrate carriers into the preferred methods of communication and tracking, like Uber Freight’s scheduling API.
Sustainable logistics
There is no doubt about it; transportation is adding a heavy burden to sustainability efforts, with the sector contributing as much as 11% worldwide to carbon emissions.
But how do you build greener supply chains? “Making sustainable choices not only helps fight climate change, but it can also save your business money and enable your transportation operations to stay ahead of changing sustainability regulations,” says Uber Freight.
In March, the US released the National Zero-Emission Freight Corridor Strategy. It has an impact on businesses and the way they operate. It sets out some guidelines to help companies contribute to the collective goal.
About the author
Mia is a multi-award-winning journalist. She has more than 14 years of experience in mainstream media. She's covered many historic moments that happened in Africa and internationally. She has a strong focus on human interest stories, to bring her readers and viewers closer to the topics at hand.
