For 2019, we anticipate a cooling trend across the industry. The market heated up early in 2018, with companies pulling in large amounts of inventory in anticipation of impending trade tariffs. Customers realized it would cost less to store extra product until they needed it rather than to order it once the tariffs were imposed. This will lead to a softer market across the board for the first quarter until those warehouses need refilling. In the meantime, many loads will have a shorter length of haul, as much of their journey has already been done.
In response to the shippers market of the last quarter, the industry added more trucks and drivers to try to meet customer’s needs. Now that all those resources are available and the market is softer there is more capacity than needed. This gives customers the bargaining power and rates will slip. As long as the economy continues to grow, we expect things to work toward a more level playing field as the year progresses.