Q&A

Freight recession reality check

Advice for carriers on what to watch now and how to prep for the rebound

The current freight recession keeps dragging on, but all industries cycle through their ups and downs. Rates will eventually rise back up.

For carriers in it for the long haul, the question is twofold: How do we manage our business during this downturn, and how can we come out ahead when the market turns? We caught up with Steve Tam, vice president at ACT Research, to learn the dynamics impacting the current freight market, which data points fleet executives should keep a pulse on and how small motor carriers can best manage their fleets.

—Interview by Shefali Kapadia, edited by Bianca Prieto

What are the most important data points trucking leaders should consider when getting a pulse on the state of the freight market?

If I could only use one data series to understand the dynamics of the freight market, it would be spot market freight rates. They are an excellent reflection of the main dynamics of the freight markets, supply (trucks), demand (loads) and the balance between the two. Too many trucks and not enough freight send rates into the basement. Conversely, more freight than trucks allows carriers to control rates.

Are there any signs that we might be nearing the end of the freight recession and an upturn in rates?

This year has seen more than its usual share of disruption in the flow of goods into, out of and around the country. As shippers pulled inventory in ahead of announced tariffs, there were indications that freight volumes might be improving. And then they weren’t, as inbound shipments paused, allowing inventory to be consumed. That happened more than once earlier in 2025. And those disruptions were in addition to the normal seasonal patterns that exist in the freight markets.

Spot freight market volumes improved in September from August, but through the middle of October, they are lower. These fits and starts are typical of how volumes have performed this year. As a result, rates have been flat and show no promise of increasing until the supply of trucks shrinks.

What’s one misconception about the freight recession that you think needs correcting?

All freight recessions are created equally. The reality is that this downturn has disproportionately impacted for-hire carriers. Part of the reason for this is that private fleets, those who primarily haul the majority of their own in and outbound freight, have increased their market share over the past three or four years. This has taken freight away from for-hire market trucking companies. Private fleets also use spot market freight to fill empty backhaul miles, and so compete on that front, as well.

What's a mistake you often see carriers making during a down market?

Market downturns usually have two sides. While demand (freight) may be in decline, too many trucks can also be the cause of a correction. Over-investment in equipment is a normal behavior when carriers are profitable. They want to increase their share of an upmarket. The problem starts when too many fleets add too much equipment too fast, leading to a market downturn. Too often, trucking companies are slow to react. They are loath to get rid of recently acquired equipment. Unfortunately, the combination of higher costs for new(er) equipment and lower revenue does not go well together.

What can or should motor carriers, especially small businesses, do during this time to stay afloat?

While it is way easier said than done, motor carriers, including small fleets, should remain disciplined during the bottom of the freight cycle. Sometimes that requires tough decisions, such as cutting costs or even trucks. Sometimes it means not accepting unprofitable loads. Small fleets should strive to keep as many of their costs as possible variable instead of fixed, so they can scale with the freight market and remain profitable.