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Truckload Linehaul, Intermodal Costs Higher Than a Year Ago

June 18, 2014

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Compared to the same time last year, truckload linehaul costs in May averaged 5.8% higher, an increase that is consistent with those of 5.7% in April and 6% in March, according to the latest Cass Truckload Linehaul Index.

With demand improving and capacity exiting the marketplace at a faster pace, the 2014 bid season, when approximately 70% of all contracts are negotiated in the first 4 months of the year, has resulted in higher truckload costs for the shipper, according to Cass.

Industry analyst firm Avondale Partners expects truckload pricing to increase 4% to 6% in 2014.

From April to May, pricing fell 2.2%, slightly less than the historical average, after displaying above-normal sequential increases in five of the last six months.

Meantime, total intermodal costs rose 2.6% year over year in May, after seeing increases of 1.4% in April and 1.8% in March, according to the Cass Intermodal Price Index.

Sequentially, intermodal costs fell 2.7%, in line with seasonal trends.

Domestic U.S. intermodal volumes should continue to grow this year, according to Avondale Partners. “Although we expect the pricing dynamic in intermodal to remain competitive and see linehaul rates remaining relatively flat in the near term, we do believe that intermodal pricing could increase modestly in 2014 if truckload capacity continues to be squeezed.”

The Cass Truckload Linehaul Index tracks market fluctuations in per-mile truckload pricing. It isolates the linehaul component of full truckload costs from other components, such as fuel and accessorials. The Cass Intermodal Price Index tracks changes in per-mile U.S. domestic intermodal costs. The index includes all costs associated with the move.

Both are derived from actual freight invoices paid on behalf of Cass’ clients, which totaled over $23 billion in 2013.

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