The semi-annual freight broker survey produced by Truckstop and Bloomberg Intelligence shows brokers are hopeful that demand could pick up in the latter half of the year.
“Though freight brokers continued to face challenging demand and rates in the first half of the year, there are some signs that the worst may be over,” says Lee Klaskow, senior freight transportation and logistics analyst at Bloomberg Intelligence. “We believe a return to seasonal demand, higher import levels and inventory restocking will help drive a recovery later this year.”
Key takeaways:
- Most brokers appear optimistic that volume growth is just around the bend, despite demand challenges. About 49% project a volume increase in the next 3-6 months, 31% expect flat loads and 20% anticipate a decline.
- An increasing number of brokers believe that rates have hit bottom, with 76% of respondents projecting rates to stay flat or increase over the next 3-6 months, three percentage points higher than the second half of 2023. Truckstop’s Market Demand Index, a measure of relative demand in the North American trucking market, rose 24% on average in 2Q from last year.
- About 44% of respondents noted lower gross margins in the first half of 2024 compared to that same timeframe in 2023. This is 13 percentage points worse than what brokers indicated in the 2H 2023 survey. Brokers are not optimistic about margins for the rest of the year as 30% expect margins to deteriorate over the next six months, seven percentage points more than in 2H 2023. Increased use of tools powered by artificial intelligence (AI) could help boost margins by improving pricing, productivity gains and network optimization. The brokerage industry is still in the early stages of AI adoption; just 36% of respondents are deploying such tools within their operations.
“Despite the improved outlook over the past six months, brokers remain skeptical about their ability to increase gross margins,” says Kendra Tucker, CEO, Truckstop. “Truckstop remains dedicated to providing tools that help brokers operate with speed and confidence, enabling them to move faster, gain efficiencies and grow profits.”