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Everyone’s favorite group, the Transportation Intermediaries Association (TIA), has put out the “3PL Market Report, Second Quarter 2024.” This report saw the return of something everyone was missing: gains across segments.
The report found: “From the first quarter to the second quarter, as well as annually, there were some gains in shipments, invoice amount per shipment, and total revenue, including: total shipments, at 1,901,058, up 5.0% sequentially, and 3.5% annually, growing for the first time in eight quarters; total revenue, at $3,689,215, up 5.6% sequentially, and down 3.6% annually; invoice amount per shipment, at $1,941, up 0.6% sequentially, and down 6.9% annually; and gross margin percentage, at 14.9%, was down 10 basis points sequentially and down 160 basis points annually.”
Those gains weren’t limited to one area. Intermodal shipments saw the largest uptick, with a 9.5% increase quarter over quarter. LTL came in second with a 7.7% gain, and truckload brought up the rear with a 3.8% increase q/q.
Anne Reinke, TIA president and CEO, said in a statement: “It is so good to finally see the industry moving in a positive direction after two years of losses. All segments of the industry saw steady growth from Q1 2024 through Q2 2024. We believe this isn’t just a blip in the market but a sign that the rollercoaster COVID freight market cycle is finally ending.”
There is still a strong oversupply of capacity in the market both from brokers and carriers needing to exit. However, the end is near for course corrections, and the normalcy, stability and predictability of the market is on the horizon.
All eyes have turned to the consumer for the rest of what 2024 will look like freight volume-wise. Consumers are expected to start holiday shopping earlier this year, and retailers have already begun pulling forward orders and goods to ensure there is something to buy.
The Fed is expected to lower interest rates in the next few weeks, which will help jump-start some of the industries that have been suffering for the past few months, like home improvement and new home starts.
Market Check. Opposites attract holds true in Little Rock, Arkansas. The market is home to polar opposites for outbound tender rejections and outbound tender volumes. The OTVI dropped 19.03% week over week. Taking the opposite approach was the OTRI, which increased 446 basis points w/w for a rate of 12.45% rejections. If it were any time except a holiday weekend, this would be a sign that the market was facing serious capacity constraints. As the Labor Day cleanup gets cleared and the OTRI remains elevated, watch and see how the market behaves for any sign of a turn or flip.
Who’s with whom? The LTL world could face another change-up as Jack Cooper LTL is in talks to acquire Standard Forwarding. Standard Forwarding is a regional LTL carrier servicing the Upper Midwest and was most recently acquired by DHL Freight in 2011. If Jack Cooper sounds familiar, it’s because it previously bid on Yellow Corp. during bankruptcy proceedings.
Standard Forwarding has become the easy purchase, as this is now the third purchase of the company since 2010. In March 2010, four members of its leadership team bought the assets. Then in June 2011, the regional carrier was purchased by DHL.
Of the possible sale, Teamsters General President Sean O’Brien said, “DHL Freight has committed to seeking to find a new employer for Standard Forwarding that will respect and maintain Teamsters protections at the company.”
The more you know
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