On this episode on WHAT THE TRUCK?!?, Dooner sits down with Thom Albrecht, Chief Revenue Officer at Reliance Partners, to break down the possible end of the freight recession and what the trucking market will look like in 2025.
On a previous episode, Albrecht predicted a March 2025 end of the freight recession and a turning point in the market. Gone would be the days of carriers barely running at a profit and just trying to get by.
In a follow-up interview with Dooner after some new data came out that called for the end of the freight recession, Albrect was right on the money in his predictions.
“Pre-election the market would have been close to equilibrium around October or November. My bet was in March of 2025. What the election did is it just about guarantees that it will be no later than March and we’ll be rocking and rolling from then.”
The result of the presidential election left all aspects of the supply chain in a wait-and-see holding pattern, with the candidates having different plans and ideologies. With the results in Donald Trump’s favor, it has left shippers with the popular option to pull freight forward to avoid any financial impacts from his threatened tariffs.
Albrecht says: “We’re seeing a lot of commentary online about freight pull forward, and that’s due to some of the uncertainty around tariffs. In the short to intermediate term, there will be more freight whether the recession is over today or early ’25. It’s in the process of dying if it hasn’t already died.” Albrecht also stated that “getting back to equilibrium is not the same as the ‘switch being flipped’. That flip usually occurs 4-6 months after equilibrium has been attained.”
Shippers who are looking to take advantage of pull-forward freight are left holding the excess stock and hoping consumer sentiment changes. Consumers have shown a mediocre demand over the past couple years, which, according to Albrecht, “leaves companies to assess, do they worry about bringing over too much, and will there be any potential write-downs down the road?”
Albrecht uses an analogy for the possible tariffs: “Here’s what’s really interesting about Trump is he’s going to use both a carrot and a stick. The stick, of course, is the threat of tariffs. I think unlike past presidents, where they would have some negotiation and then just slap a tariff, I think he really intends to engage companies, nations around what’s fair. He’s going to be really aggressive in trying to use that as a stick to get [goods] back over here. The carrot is the lower potential corporate tax rate, which he ran on a rate of 15%, down from the federal tax rate of 21% for corporations.”
As for what to expect in 2025, Albrecht says, “There’s a lot of exciting things there that all bode well for freight creation. What’s preferred is faster economic growth which can absorb the pull forward of freight. If underlying demand remains mediocre, then after the pull forward there could be another freight hangover.”