Despite restrained demand for shipments, carriers are regaining pricing power after years of weak rates. ATRI’s latest cost study shows that in 2025, fleet costs outpaced consumer inflation. Separate rate and tender data shows prices are rising as carriers exit the market and enforcement removes more supply from it.
June’s Logistics Managers’ Index is another warning sign, with transportation prices close to a record, capacity contracting for a seventh month, and retailers pulling goods forward ahead of tariffs and peak season. California’s sudden tightening sent Northeast reefer rates for produce freight sharply higher. The downcycle might be behind us, but the recovery is more a function of lost supply rather than broad-based demand growth.
Operating Costs Rise Faster Than Inflation
According to ATRI, the average trucking operating costs increased 3.4% in 2025 to $2.336 per mile. Costs excluding fuel were up 4.2% to $1.854 per mile, 1.5 percentage points above consumer inflation. Equipment payments, repairs, insurance, and tire costs all increased, while freight rates and tonnage remained flat.
Driver wages increased 2.5% below inflation, while benefit costs increased by 6.6%. Starting bonuses dropped to $1,733 and retention bonuses to $1,474, but safety and fuel economy bonuses rose. Turnover fell to 44.2% as there are fewer job openings in a soft market. The respondent mix warrants caution, though. LTL fleets represented 47.8% of respondents, compared with 28% of the industry, while truckload fleets were underrepresented.
Fewer Trucks Push Rates Higher Before Demand Fully Returns
Freight volumes softened, but truckload rates continued to push higher in May and June. DAT reported May spot rate gains of 22 cents per mile for dry van, 24 cents for reefer, and 19 cents for flatbed. ACT Research predicted that June spot rates, excluding fuel, would increase by more than 40% year over year. Its driver availability index remained in the low territory at 32.6.
Drivers have less equipment investment and fewer available trucks, and tougher enforcement, immigration policies, fraudulent ELD crackdowns, and driver school closures have reduced driver numbers. Trucking revenue rose 4.3% in the first quarter, showing some improvement in demand, but much of the rate increase is due to supply constraints.
Transportation Prices Stay Near Record Levels
Transportation prices posted a 92.4 reading in June, just 3.6 points short of May’s record, according to the Logistics Managers’ Index. Capacity came in at 30.8, marking seven straight months of contraction, while utilization increased to 74.7. Utilization was 78.8 in the second half of June, the highest since 2015.
Carriers said tighter enforcement had taken supply out, weakened routing guides, and forced a reopening of contract rates for some shippers. Those who responded to the survey expect tight conditions to continue over the next 12 months.
Retail inventories climbed to 60.5 as companies pulled goods forward ahead of tariffs and back-to-school demand. Overall, LMI was 71.1, the first reading above 70 since March 2022. Space use and prices increased, and warehousing capacity also decreased.
California Produce Tightening Sends Reefer Rates Northeast
Availability of refrigerated trucks retreated in six California produce districts in one week, the widest pullback this season. Volumes were flat year over year, suggesting there weren’t enough trucks available rather than a surge in shipments. The greatest increases were in the northeast-bound lanes.
Prices from Imperial and Coachella Valley to Boston increased from $11,300-$12,200 on July 7 to $13,900-$14,400 on July 14. New York rates were up to $12,600-$13,400. Similar movements were seen from Santa Maria, Oxnard, and Kern. Yakima Valley also fell into mild shortages during peak cherry season.
South Texas also got tighter, but rates had not yet caught up. Georgia took the opposite route, as rates dropped for a second straight week despite the unchanged truck shortage.
Freight Recovery Rests on Scarce Capacity and Uneven Demand
LeadCoverage believes the freight recession is over, but the recovery is fragile because it depends more on supply disappearing than broad demand growth. Demand is strong, but that is mainly for industrial freight. Spot rates are at record highs, and tender rejections are at their highest since 2022. Flatbed activity is up due to data center construction, but consumer demand and homebuilding are flat.
Thomson Reuters data shows that 72% of trade professionals cite tariff volatility as the top change, and 76% expect it to continue, 65% are changing sourcing, and 51% are moving production closer to or into the U.S.
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