The U.S. domestic truck freight market showed strains for carriers in Q3 2023. For the third consecutive quarter, the national shipments and spend indexes all declined quarterly, and year-over-year, according to the U.S. Bank Freight Payment Index, released November 1. 

While the overall economy continues to grow, U.S. Bank said, the truck freight economy is still impacted by many factors, including consumer spending on experiences over tangible goods, a softer housing market, and factory output falling from a year earlier. Based on data published by the Bureau of Economic Analysis, personal consumption of goods contracted during the quarter from Q3 2022 levels, but meanwhile households spent more on experiences, even after accounting for price increases, such as air travel.

In addition, excess household savings that were built up during 2020 and 2021 are evaporating, the bank said.

Continued retailer inventory reduction also had an adverse effect on freight volumes during the quarter. 

Another headwind on freight volumes is the housing market. As interest rates have risen from near 0% during Q1 2022 to more than 6% in Q3 2023, mortgage rates have increased as well. Data from Freddie Mac shows the average 30-year fixed mortgage went from less than 3% in early 2021 to nearly 7% in Q3 2023.

This has discouraged people from selling their homes and moving, and partly as a consequence, new home construction appears to have fallen 5% or more in the third quarter compared with the second quarter, based on early housing starts data from the Census Bureau. U.S. Bank pointed out that, when housing slows, it also reduces consumption of items needed to fill a home, such as furniture and appliances, all of which reduces truck freight.