Supply Chain Action Points
Read this first — the conclusion, and the moves to make:
- By 15 September, pull eight weeks of pickup-on-time by lane and flag every lane where tender rejections exceed 10%; those are equipment-exposed lanes, and they are not the same list as price-exposed lanes.
- Move the flagged lanes onto a named-carrier commitment with a stated weekly trailer guarantee rather than a rate commitment, in writing before 1 October.
- Rebuild the contract around a fuel-excluded linehaul benchmark with an explicit reopen trigger: a move of more than 8% from the signing level reopens terms within ten business days.
- Shift 10% of volume on lanes over seven hundred miles to a mode or lane where equipment is not the binding constraint, and measure the pickup-on-time delta for one quarter before going further.
- Add a detention and missed-pickup cost line to the freight budget so the October review compares total landed cost, not the linehaul number.
DAT's 1 September update put dry-van spot linehaul rates at about $2.19 per mile excluding fuel, roughly 32.4% higher than a year earlier and about 21% above its nine-year seasonal average. With carrier exits and reduced equipment availability removing excess capacity, the market is capacity-driven rather than volume-led, leaving shippers fewer cheap spot options into peak season.
The Analysis
A dry-van spot linehaul of about $2.19 a mile, fuel excluded, in the 1 September read. That is 32.4% above a year earlier and roughly 21% above the nine-year seasonal average. The note attached to it says capacity: carriers exited, equipment got scarcer, and the market is being run by capacity rather than volume.
Read that as a price story and you will spend the quarter arguing about rates. Read it as an equipment story and you will spend the quarter making sure a trailer is at your dock on the morning you said it would be. The failure mode here is not a high invoice. It is an empty dock at seven in the morning.
Anyone buying truckload capacity into the fourth quarter should work out which of those two problems they actually have.
A carrier that exits does not hand its trailers to the market at a discount. The tractors get sold or parked. The trailers get parked in a field, aged out, or sold to somebody who will run them until the floorboards go. The drivers take another job and do not come back because a rate moved. So when the rate rises, capacity does not return on the rate. It returns on a tractor order lead time and a hiring cycle, and neither of those answers inside a quarter. That is why a 32% move can sit where it is instead of mean-reverting the way a demand spike would.
Pull the two percentages apart. Divide $2.19 by 1.324 and the year-ago level was about $1.65 a mile. Divide by 1.21 and the nine-year seasonal norm for this point in the year was about $1.81. The market is not merely above last year; it is about 38 cents above the shape the year is supposed to have. Seasonal tightness is something you can plan around because it has a calendar. A level shift does not. The 21% against the seasonal line is the number that says this is not a peak bump, and it is the number I would put in front of a chief financial officer instead of the 32%.
Contract shippers and spot shippers are not in the same event. If you hold annual contracted capacity, your rate resets on an index with a lag and you meet this at renewal, which in practice means three to six months out, and you meet it as a negotiation rather than a transaction. If you buy spot every week, you meet it this week, and you meet the second-order effect nobody budgets: when capacity is short, carriers pick the freight that fits their network, and the loads rejected first are the short hauls, the multi-stop runs, the appointment-heavy ones and anything with a narrow window. That profile describes most mid-size shippers. A large shipper with a dedicated fleet is not in this market at all. Lane length matters here more than trade direction: a port-to-warehouse move of two hundred miles competes for the same tractor as a thousand-mile run, and it is the less attractive piece of work when a carrier gets to choose.
Spot moves, contract follows. What printed on 1 September is the price of the marginal load, the one nobody had covered. Your renewal is where it becomes your problem. If your contract year starts in January, you are negotiating in the fourth quarter against a market that was already up 32% in September, and the carrier knows it. If your contract renews mid-year, you have a stretch where you are paying last year's number into a market that has moved, and service usually degrades before the price catches up.
The part that does not get said. Spot is a residual market, which makes it a poor thermometer for your actual cost and an excellent one for the physical shortage underneath. When spot holds 21% above its seasonal line for weeks rather than days, the carriers that had spare trailers have already been picked clean and what remains is the expensive tail. Your contract carrier is buying in that same tail to cover its own commitments. So the contract protects you from the price of the equipment problem and not from the equipment problem itself. If your agreement says the carrier provides the equipment, that carrier is now sourcing at a spot number well above the contract number to serve your load, and it will find a reason not to.
The reason arrives as a late pickup, a detention charge, or a call at four on a Friday saying no truck. None of that shows up in a rate benchmark, and all of it costs more than the rate difference. Worth adding that the 32% is linehaul with fuel stripped out, so your all-in invoice moved by less than the headline if fuel was flat, while the capacity signal underneath is stronger than the headline suggests.
Run the small account. Assume a five-hundred-mile average haul and a hundred and twenty loads a month, which are my assumptions and not numbers from the release. At $2.19 the linehaul is $1,095 a load. At the implied year-ago $1.65 it was $827. The difference is $268 a load, $32,200 a month, about $386,000 a year. Now price the other failure: one missed pickup a week that leaves a distribution centre short for a day costs more than that in most networks, and it never appears in the freight budget. The cheaper-looking line item is hiding the more expensive problem.
Each alternative carries a different bill. Staying on spot buys flexibility and sells you rejection risk. Moving long lanes onto rail trades a rate problem for a dwell problem at the ramp. Leasing your own trailers caps the equipment risk and hands you maintenance, utilisation and residual value. None of those is wrong. The mistake is picking one without pricing the failure mode it introduces.
The trap I see most often is benchmarking the contract against spot, concluding the contract is fine, and stopping there. On price it probably is fine. The exposure moved to service, and service failures stay invisible if you measure carrier performance on rate compliance instead of pickup compliance. Watch the pickup, not the invoice.
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