Right now, this is a supply-driven squeeze, with driver enforcement, higher operating costs, and record fuel prices layered on top of soft freight demand. FTL and LTL costs are both climbing even though volumes aren't booming. We see it day to day: tender rejections are running high, flatbed and short-lead-time freight are the hardest to cover, and shippers are moving more lanes to spot to keep freight moving. Carriers are managing cost pressure from fuel, insurance, equipment, and compliance, and they're being more selective about the freight they can cover profitably.
Rising truck costs are prompting more shippers to take another look at rail and intermodal, but there are limits on how much freight can actually shift. The linehaul rate may be lower, but drayage, terminal dwell, and accessorial charges can narrow the savings. Moving a lane to rail or intermodal changes both planning and execution, with longer lead times, earlier booking, and different handoffs. Combined with service reliability concerns, that complexity is often what keeps freight on the highway, even when the rate math looks attractive. Over time, shippers will diversify capacity by getting more deliberate about mode by lane. Rail and intermodal will make the most sense for longer, predictable, planned moves, while truck remains the right fit for time-sensitive or variable freight.
The capacity leaving the industry won’t come back quickly, so costs will stay elevated and the market will stay volatile for the long term. My advice to shippers is to treat carriers as partners. Work out creative agreements and routing guides, build backup capacity on critical lanes, and get enough visibility into total cost and carrier performance to adapt when conditions change.
