Dive Brief:
- Around 9,000 trucking businesses left the market in April, but that rate of exits lessened in May and June, according to Federal Motor Carrier Safety Administration data compiled by Trucking Dive.
- “We are seeing the net decline in the carrier population starting to slow,” FTR VP of Trucking Avery Vise told Trucking Dive last week. But that change is “still highly negative in historical terms,” he said.
- Collectively, carrier exits consistently outweighed new and reinstated operating authorities during Q2, indicating that businesses tended to leave rather than stay in the market at that time.
Recent snapshot shows exits outweighed additions
Dive Insight:
Truckers might be trying to time the next cycle, yearning for a turnaround. That’s left major trucking firms unable to precisely pin down just how much cash reserves or willpower smaller players have.
“We still have, at this point, more than 93,000 more for-hire carriers holding authority” than in February 2020, Vise said.
Used tractor prices as well as notable stability in the market appear to be affecting many carriers’ decisions, Vise said. New entrances have increased modestly, and exits have slowed recently, he said.
Cumulative revocations eclipse grants in 2024
FTR forecasts favorable conditions consistently taking hold no earlier than 2025. While conditions could improve this year, perhaps in Q4, a rebound seems out of the picture this year, Vise said. “It's going to be a ways before that happens,” he said.
Analysts note reservations with FMCSA operating authority data, such as how an entity’s size is not fully captured in the trend data. Meanwhile, other data captures the average number of employees per establishment and shows that figure has fallen in recent years, which comes as the number of trucking business locations rose rapidly during the pandemic.
That meteoric rise is changing, though. Data from the Bureau of Labor Statistics' Quarterly Census of Employment and Wages, which run through Q4 2023, show a dramatic slowdown in the total number of establishments, according to Jason Miller, interim chair of Michigan State University’s Supply Chain Management department.
“I expect 2024's readings will be down from Q3 & Q4 2023 levels,” he wrote in an email.
