Hopes for a turnaround in the trucking industry were dashed in June, as the long-awaited rebalancing between freight demand and truck capacity remained stubbornly out of reach. Freight rates that couldn’t seem to get any lower got lower. Operational costs got higher.
The cost of diesel fuel — which had seen lower prices over 2024 and was a bright spot for truckers — rose steadily in June and has continued rising through July.
With analysts claiming that financial relief is on the horizon, that horizon continues to get farther away.
June freight indexes show decline
The Cass Freight Index for Shipments reported a small decline (0.2%) in June from the May index but a 2.4% decline from June of 2024.
The Index for Expenditures (the total amount paid by Cass clients for shipping) also declined. Expenditures dropped 1.2% in June despite being 2.6% higher than in June of 2024. After the sharp rise in freight volumes during the pandemic, the Shipments Index fell 5.5% in 2023 and another 4.1% in 2024, and it’s on pace for another decline this year.
Tim Denoyer, who is vice president and senior analyst for ACT Research and writes for the Cass report, says tariffs are the cause of much of the turmoil in the market.
“The effects of the highest tariffs since the 1930s are very uncertain,” Denoyer wrote. “They’ll be limited by the 75% to 80% of freight already made and consumed domestically, but the impacts on international trade have been and will continue to be significant.”
Denoyer points out that the threat of increased tariffs earlier this year resulted in increased imports as manufacturers and retailers increased inventories before tariffs went into effect. Rather than ordering more product at higher tariff rates, he says, many will choose to rely on existing inventory for as long as possible.
“The effects of tariffs may worsen, as higher goods prices reduce affordability and real incomes,” Denoyer wrote. “With this outlook, the cycle upturn for the transportation industry remains elusive.”
While the Cass Indexes are based on multiple modes of transportation including truck, air, rail, pipeline and ship, the American Trucking Associations (ATA) is all truck transport and the majority is contract freight.
The ATA For-Hire Trucking Index dropped 0.4% in June following a 0.1% decline in May.
“Freight levels have been helped recently by small gains in factory output and retail sales but weaker construction activity, especially for single-family homes, has been a drag on volumes,” said Bob Costello, chief economist at ATA.
Carriers that depend on spot freight rates didn’t fare any better.
The DAT Truckload Volume Index, a measure of loads moved from the DAT load board during the month, declined by 2% in June for dry van freight, fell 5% for refrigerated freight and grew by 1% for flatbed. While all three figures were higher than June 2024, indicating more freight to haul, spot rates responded sluggishly. Dry van rates rose by three cents per mile to $2.02 while refrigerated rates climbed by one cent per mile. Flatbed rates remained unchanged.
Analysts point to tariffs as culprit
Once again, analysts say inventories fueled by tariffs were the culprit.
“Many retailers and manufacturers continued to hold inventory at current levels or allowed it to draw down,” said Ken Adamo, chief of analytics at DAT. “Freight moved in fits and starts rather than steadily and predictably building toward the July 4 holiday.”
In a July 23 update to its “Trucking Industry Forecast for 2025,” ACT Research addressed capacity (the number of trucks available to haul freight).
“Capacity remains elevated but is gradually rebalancing,” the report noted. “Class 8 build rates declined further in May, and the used truck market has seen rising transaction volumes, helping reduce excess inventory. New equipment orders remain near multi-year lows and OEMs are responding with selective production slowdowns.”
Orders for new trucks fell again in June and cancellations of orders previously placed rose for the second consecutive month.
The ACT report blames — in part — tariffs and the higher cost of equipment for at least part of the truck sales slowdown.
“ACT Research estimates June per-unit increases of roughly $375 for tractors and over $580 for trailers, driven by higher component and material costs,” the report read.
Operational costs on the rise
The American Transportation Research Institute (ATRI) issued its 2025 update to its “Analysis of the Operational Costs of Trucking” in July. The report was compiled using carrier-submitted data for more than 178,000 tractor-trailers, accounting for about 5.4% of all registered trucks.
The ATRI report showed increases in cost for truck and trailer lease or purchase payments of about three cents per mile, a rise of 8.3%. Higher equipment prices as well as the cost of credit contributed to the increase.
To no one’s surprise, insurance premiums for trucking rose again, reaching an average of $0.102 per mile in 2024. The increase over 2023 premium cost was about 3%. As tolling authorities raise their rates to keep pace with inflation and repair costs, there was a significant increase in average cost per mile for tolls. Overall, the cost per mile reported was 3.8 cents, up 0.4 cents from 2023 for an increase of nearly 12%.
According to the U.S. Energy Information Administration (EIA), the U.S. national average price per gallon for diesel fuel ended May at $3.49. By the end of June, it was $3.73, adding a few more cents per mile to everyone’s cost of operation. For a time, the lowered fuel costs, down about 27 cents per gallon in May from 2024 prices, helped carriers absorb the higher costs of insurance, maintenance, tolls and driver pay and benefits. That’s no longer the case as June fuel prices were about the same in 2024 and 2025.
President Donald Trump’s campaign pledge to increase exploration and drilling for petroleum could help keep oil prices lower, but unrest in the Ukraine and in the Middle East, especially around the Red Sea and the Strait of Hormuz, could disrupt world oil supplies, sending barrel prices skyward.
For at least the next few months, expect little change in freight availability or rates. Reduced capacity caused by lowered truck sales will eventually prevail, but it won’t happen quickly.
Cliff Abbott is an experienced commercial vehicle driver and owner-operator who still holds a CDL in his home state of Alabama. In nearly 40 years in trucking, he’s been an instructor and trainer and has managed safety and recruiting operations for several carriers. Having never lost his love of the road, Cliff has written a book and hundreds of songs and has been writing for The Trucker for more than a decade.
