COLUMBUS, Ind. — With 20%-25% of US surface freight involved in international trade, tariffs are set to extend the for-hire freight recession.
“As Q2 begins, retail sales are still brisk as consumers snap up pre-tariff prices, but freight demand fundamentals face major self-inflicted tariff headwinds,” said Tim Denoyer, ACT Research’s vice president and senior analyst. “The pre-tariff inventory stocking period will soon reverse, and consumption will fall as prices rise. We expect a few more months of brisk demand for pre-tariff goods, followed by a tariff adjustment period with lower goods demand. Freight is very much in the crosshairs of the trade war.”
While recessionary effects of the trade war are still to come, ACT expects higher cost equipment as a result of tariffs to eventually tighten capacity and help end the long for-hire freight recession, according to the latest release of the Freight Forecast: Rate and Volume OUTLOOK report.
“The trucking industry also faces considerable supply shocks related to new US government policy,” Denoyer said. “Both equipment and labor supply are affected, and this is likely to press truckload rates up after tariffs take their toll.”
Dana Guthrie is an award-winning journalist who has been featured in multiple newspapers, books and magazines across the globe. She is currently based in the Atlanta, Georgia, area.
