Executive Briefings

Truckload Rates Flat - For Now - While Intermodal Is on the Rise

For those interested in transportation management, the news that truckload rates are trending flat for the time being may be good, although on a year-over-year basis, May's index registered 5.0 percent higher than for the same period last year. The continuing share shift toward intermodal is at least one reason rates are being held in check.

In his firm's monthly report, Donald Broughton of Avondale Partners said that despite the current steadiness, "We continue to believe that capacity remains constrained and that 6 to 9-percent rate increases are possible for 2012.

For the second straight month, base intermodal rates were higher than they were at the same time last year. May's index value of 102.6 registered a year-over-year increase of 1.4 percent.

The relatively high rates are likely attributable to increased demand for intermodal created by spiking diesel prices and tight capacity in trucking. However, Broughton adds, "With diesel prices easing in recent weeks, the modest pricing improvement seen in the last two months could begin to fade. We continue to believe that over the intermediate term, the large number of containers coming on line and aggressive pricing by carriers focused on ramping up their intermodal businesses will keep rates grounded."

The Cass Truckload Linehaul Index is a measure of fluctuations in U.S. domestic baseline truckload costs. It accurately isolates the linehaul component of full truckload costs from other components (e.g. fuel and accessorials).

The Cass Intermodal Linehaul Index measures changes in U.S. domestic intermodal rates. Like the truckload index, it also measures linehaul rates only, without fuel and accessorials.

Source: Cass Information Systems

In his firm's monthly report, Donald Broughton of Avondale Partners said that despite the current steadiness, "We continue to believe that capacity remains constrained and that 6 to 9-percent rate increases are possible for 2012.

For the second straight month, base intermodal rates were higher than they were at the same time last year. May's index value of 102.6 registered a year-over-year increase of 1.4 percent.

The relatively high rates are likely attributable to increased demand for intermodal created by spiking diesel prices and tight capacity in trucking. However, Broughton adds, "With diesel prices easing in recent weeks, the modest pricing improvement seen in the last two months could begin to fade. We continue to believe that over the intermediate term, the large number of containers coming on line and aggressive pricing by carriers focused on ramping up their intermodal businesses will keep rates grounded."

The Cass Truckload Linehaul Index is a measure of fluctuations in U.S. domestic baseline truckload costs. It accurately isolates the linehaul component of full truckload costs from other components (e.g. fuel and accessorials).

The Cass Intermodal Linehaul Index measures changes in U.S. domestic intermodal rates. Like the truckload index, it also measures linehaul rates only, without fuel and accessorials.

Source: Cass Information Systems