Truck volumes drop 15% post-Labor Day but spot rates hold at $3.44/mile, +47% YoY

The Analysis

FreightWaves reported on 9 September that its STVI fell nearly 15% after the Labor Day surge, while the National Truckload Index held at $3.44 per mile, up 47% year on year. Diesel stood at $5.60 a gallon. Reefer tender rejections stayed above 20% against 12.35% for dry vans, and intermodal contract rates rose 3.5% to $1.80 per mile as shippers moved volume off the road.

Read the divergence before you react to it. A 15% drop in volume that leaves the rate unmoved is not a demand story, it is a capacity story. If capacity were loose, a 15% fall in tenders would clear the backlog and the rate would follow within days. It did not, and the tender rejection data explains why: reefer carriers are turning down more than one in five loads, which is what a carrier does when it can choose. Diesel at $5.60 a gallon, up nearly 10% in a week, is a floor under the rate rather than a signal of strength in demand.

The five briefs below address different decisions. Exporters selling DDP into the US inland need the domestic leg re-priced and a fuel basis stated. Import e-commerce sellers need a per-unit inland cost and a route that survives the peak. Factories need to know whether their plants are rail-served. Brands need to know which promises reefer rejections put at risk. Procurement needs to set the contract-to-spot ratio and write the fuel clause correctly.

For Exporters

• By 11 September: rebuild every open US inland DDP quote on $3.44 per mile with the fuel basis of $5.60 a gallon stated on the quote.
• Add a fuel adjustment clause by 15 September: about $0.015 per mile for every $0.10 a gallon move, settled monthly against a named publication.
• Cut inland DDP quote validity from 30 days to 14 days by 22 September and stop quoting DDP on single-pallet moves.
• Get written confirmation of the peak surcharge and detention terms by 30 September.
• Test intermodal on lanes where $1.80 per mile plus roughly $900 of drayage still beats $3,440 a load.
• Match the importer-of-record delivery address to the actual drop point whenever the domestic leg changes.

Diesel at $5.60 a gallon and a truckload rate holding at $3.44 per mile, 47% above a year ago, is a landed-cost problem for anyone selling DDP to a US inland address. Under DDP you own the domestic leg, and that leg is the one that repriced hardest. The 15% volume drop after Labor Day would normally be the moment to wait for rates to soften. It is not that moment, because the same report shows reefer tender rejections above 20% and dry van rejections at 12.35%, which means carriers are still turning work away. A rate that holds through a volume slump will not fall when volumes come back in October.

Run the lane. Assume a 1,000-mile inland move on a 53-foot van carrying 26 pallets. At $3.44 per mile the linehaul is $3,440, or $132.31 a pallet. A year ago, at the rate implied by a 47% increase of about $2.34 per mile, the same load was $2,340 and $90 a pallet, so the move has added $1,100 a load and $42.31 a pallet. Fuel is a quarter of it. Assume 6.5 miles a gallon, so 1,000 miles burns 154 gallons, and at $5.60 that is $861 of the $3,440. That matters for the quote, because a $0.10 move in diesel is $15.40 a load, about $0.015 a mile, and diesel moved nearly 10% in a single week.

By 11 September, rebuild every open DDP quote for US inland delivery on $3.44 per mile and state the fuel basis of $5.60 a gallon on the face of the quote. By 15 September, put a fuel adjustment clause in the terms: the rate moves about $0.015 per mile for every $0.10 a gallon move in the published diesel average, settled monthly, with the publication and the reference week named. By 22 September, move to a 14-day quote validity on inland DDP rather than 30 days, and stop quoting DDP on single-pallet or single-container moves where fixed accessorials outweigh the linehaul. By 30 September, get written confirmation of the peak surcharge and the detention terms, since a rate that holds is often accompanied by accessorials that do not.

Three alternatives. Move to DAP and let the buyer arrange the domestic leg, which removes the exposure and hands a $132 a pallet number to your customer. Convert to intermodal where the lane and the cargo allow it, at $1.80 per mile on an intermodal contract, which is $1,640 below truckload on a 1,000-mile lane before the roughly $900 of drayage at both ends. Or ship to a coastal warehouse and let the buyer pull, which shifts the risk and the relationship together. The pitfalls are in the details.

A DDP quote built in June on a $2.60 rate has no mechanism to recover the difference. A fuel surcharge calculated on a baseline the carrier chooses is not a hedge. Detention and appointment fees at the delivery end can exceed the linehaul change on short lanes. And under DDP the delivery address on the importer-of-record data has to match the actual drop point, so moving a domestic leg to a different warehouse means amending the paperwork as well as the rate.

For Cross-Border E-commerce

• By 10 September: separate the domestic leg out of every SKU landed cost and split lanes above 600 miles from short-haul lanes.
• Test intermodal by 15 September: worth doing above 1,000 miles, not worth doing at 600 miles once $900 of drayage is counted.
• Move bulky slow movers onto long intermodal lanes and keep fast movers on the road by 22 September.
• Agree the peak surcharge schedule with your carrier before the October rebuild by 30 September.
• Get appointment and detention terms in writing for every lane you tender.
• Book temperature-controlled capacity ahead: reefer rejections are above 20% against 12.35% for dry vans.

A truckload rate holding at $3.44 per mile, 47% above last year, while volumes fall 15%, reaches an import e-commerce seller through the domestic leg rather than the ocean leg. Where you run your own truckloads between a port or a 3PL and an inland fulfilment centre, the move from $2.34 to $3.44 per mile is a 47% increase on a cost line that appears in no marketplace fee schedule and in no free-shipping threshold. The intermodal contract rate at $1.80 per mile, itself up 3.5%, is the cheapest available substitute, and it is worth one and a half to two extra days.

Assume 20 truckloads a month on a 600-mile lane from a coastal 3PL to an inland fulfilment centre. At $3.44 per mile that is $2,064 a load and $41,280 a month. A year ago at $2.34 per mile it was $1,404 a load and $28,080 a month. The increase is $660 a load, $13,200 a month and $158,400 a year. Per unit, assume 26 pallets at 40 units each, so 1,040 units a load: the inland cost has gone from $1.35 to $1.98 a unit, up $0.63. On a $35 item at a 35% gross margin of $12.25, that $0.63 is 5% of the margin before any reefer premium. And if your fulfilment partner tenders these loads for you, check which rate it is using, because a 47% market move is exactly the kind of change that gets absorbed quietly into a handling charge.

By 10 September, pull the domestic leg out of the landed cost for every SKU and separate truckload lanes above 600 miles from short-haul lanes. By 15 September, test intermodal on the lanes where the fulfilment centre sits within drayage range of a ramp: at $1.80 per mile plus roughly $900 of drayage at both ends, a 600-mile load costs about $1,980 against $2,064, which is too thin to bother with, while a 1,000-mile load costs about $2,700 against $3,440, which is worth the extra day. By 22 September, move appliances, furniture and other bulky slow movers onto the longer intermodal lanes and keep the fast movers on the road. By 30 September, agree the peak surcharge schedule with your carrier before the October rebuild and get the appointment and detention terms in writing, because those are the charges that turn a held rate into a rising invoice.

Three routes. Intermodal where the lane is long enough to absorb the drayage. A different inland node so that the domestic leg is shorter, which does the same job as negotiating a better rate. Or a carrier contract with committed volume, which fixes the rate and obliges you to tender loads whether the volume is there or not. The pitfalls matter. Reefer rejections above 20% mean temperature-controlled SKUs carry an exposure that dry freight does not, so a frozen-goods promotion without booked capacity is a refund queue. Intermodal adds a ramp appointment and a transload, which is where damage and claims live, and 26 pallets of loose cases do not transload as cleanly as they load. And a rate that fell 15% in volume terms without falling in price is your clearest signal not to build an October plan on the assumption of cheaper trucking.

For Manufacturing Plants

• By 10 September: split inbound freight into A-class, where a late arrival stops a line, and B-class, where it does not.
• Get ramp-to-ramp rail pricing on every lane above 700 miles by 16 September, with drayage and appointments included.
• Move B-class inbound to intermodal at 45 days of coverage and keep A-class on the road at 10 days by 23 September.
• Price a transload warehouse by 30 September where the plant is not rail-served: 20 loads a month saves $8,240.
• Confirm fourth-quarter maintenance and shutdown windows by 7 October before booking capacity into them.
• Keep line-stopping parts off rail and book temperature-controlled inbound ahead of the tender date.

At $3.44 per mile, 47% above last year, inbound freight is now a material line in the product cost rather than an overhead. If your plant buys on delivered terms, your supplier has been absorbing it and will re-price at the next review. If you arrange the freight, the increase is already yours. The 15% volume drop after Labor Day is the point at which plants usually wait for rates to fall. The same report says reefer tender rejections are above 20% and dry van rejections are 12.35%, so carriers still have alternatives. A rate that holds through a volume decline will not soften when October volumes return, and waiting simply defers the same increase.

Assume a plant taking 30 inbound truckloads a month over 800 miles. At $3.44 per mile that is $2,752 a load, $82,560 a month and $990,720 a year. A year ago at $2.34 per mile it was $1,872 a load and $56,160 a month. The increase is $26,400 a month and $316,800 a year on the inbound leg alone, before a single outbound move. Now test the rail option. If the plant is rail-served, moving 20 of those 30 loads to intermodal at $1.80 per mile is $1,440 a load, plus roughly $900 of drayage at both ends where the plant is not served, so $2,340 against $2,752, a saving of $412 a load. Across 20 loads that is $8,240 a month and $98,880 a year, for about a day and a half of extra transit and a ramp appointment on every load.

By 10 September, split inbound freight into A-class, where a late arrival stops a line, and B-class, where it does not, and cost both legs against $3.44 per mile. By 16 September, ask your rail provider for ramp-to-ramp pricing on every lane above 700 miles and put those numbers next to the truckload rate, with drayage at both ends and the appointment cost included. By 23 September, move B-class inbound onto intermodal at 45 days of coverage and leave A-class on the road at 10 days, which is where the two modes belong. By 30 September, if the plant is not rail-served, price a transload warehouse near the ramp against the saving, because on 20 loads a month the saving is $8,240 and a transload does not cost that. By 7 October, confirm the fourth-quarter maintenance and shutdown windows, because freight booked into a shutdown is freight you pay for twice.

The alternatives are an intermodal conversion, a nearer port or supplier, a transload warehouse, or a second carrier on a committed rate. A nearer supplier changes the lane rather than the rate and is the only one of these that reduces the underlying miles. The pitfalls are operational. Intermodal reliability on a loaded rail network is not truckload reliability, so moving A-class parts to rail to save $412 a load costs $21,600 a day if the line stops. Reefer rejections above 20% mean any temperature-controlled inbound, including adhesives, resins and some coatings, has to be booked further out rather than tendered on the day. A fuel surcharge built on a baseline your carrier selects will not protect you when diesel moves 10% in a week. And a contract signed for committed volume in a market where volumes fell 15% leaves you paying for space you did not use if the expected recovery does not arrive.

For Brand Owners

• By 12 September: map every customer promise to its lane and mode and flag the ones dependent on temperature-controlled capacity.
• Set the priority order for scarce loads by 18 September and put it in writing so it is not decided at the dock.
• Publish the temporary promise per tier and brief customer service with the exact wording by 25 September.
• Put the fuel and accessorial schedule in writing with the 3PL by 30 September, naming the diesel baseline and reference week.
• Move the dry range to intermodal at $1.80 per mile and hold the road for dated or temperature-controlled loads.
• Budget the domestic leg at $3.44 per mile for October rather than planning on a retreat to $2.34.

The rate that matters for a brand is the one behind the delivery date. $3.44 per mile, 47% above a year ago, and reefer tender rejections above 20% against 12.35% for dry vans, together mean two things: the cost of moving a load is up by nearly half, and on temperature-controlled lanes roughly one in five tenders is being refused. A 15% volume drop is the moment when a planning team assumes relief is coming. The rejection data says otherwise, and a promise built on the assumption of relief is a promise built on a rate that does not exist.

Assume 25 truckloads a month between your 3PL and your retail and e-commerce fulfilment nodes over 900 miles. At $3.44 per mile that is $3,096 a load, $77,400 a month and $928,800 a year. A year ago at $2.34 per mile it was $2,106 a load and $52,650 a month, so the increase is $24,750 a month and $297,000 a year. On the temperature-controlled share, assume 20% of tenders are rejected: on 25 loads that is 5 loads a month re-covered on the spot market, and at an assumed $400 premium a load that is $2,000 a month and $24,000 a year, spent purely to keep a promise that was already priced. Put the two together and the domestic leg has taken $26,750 a month out of a plan that nobody re-forecast.

By 12 September, map every customer promise to the lane and the mode that delivers it, and mark which promises depend on temperature-controlled capacity. By 18 September, set the priority order for scarce loads: dated promises to consumers first, wholesale orders with a lead-time tolerance next, promotional replenishment last, and put it in writing so the decision is not made at the dock. By 25 September, publish the temporary promise per tier and brief customer service with the exact wording, including the reason, because a customer told in advance that a delivery is eight days out is a satisfied customer, and a customer surprised at the door is a return. By 30 September, put the fuel and accessorial schedule in writing with your 3PL, including the diesel baseline and the reference week, and confirm which lanes carry committed capacity through December.

The alternatives are to extend the promise on the tiers where the promise is not the differentiator, to move the dry portion of the range to intermodal at $1.80 per mile while holding the road for anything temperature-controlled or dated, or to cut promotional depth on the SKUs that need the most expensive lane, which protects margin at the cost of volume. The pitfalls show up in the reviews rather than in the ledger. A brand that quietly lengthens delivery dates loses the same customers as one that misses them, but loses them more slowly and more angrily.

Moving dry freight to rail to save $1.64 a mile is right on a 1,000-mile lane and wrong on a 400-mile one once the $900 of drayage is counted. A reefer load rejected at the dock is not a delay, it is an unplanned spot purchase, and where the product is frozen the cost of a failed recovery is the product. And in a market where volume fell 15% and the rate did not move, plan on the rate staying at $3.44 rather than on it coming back.

For Procurement Teams

• By 11 September: build one table of a year of lane data covering miles, loads, mode, rate and accessorials, and cost the all-in rate per load.
• Get two quotes per lane by 15 September: committed truckload with a shortfall tolerance, and ramp-to-ramp intermodal with drayage listed separately.
• Fix the fuel clause by 22 September against the $5.60 a gallon reference: about $0.015 per mile per $0.10 a gallon, monthly settlement, stated cap and floor.
• Convert 15 loads a month to intermodal where drayage is under $900 and transit tolerance is at least two days, by 26 September.
• Attach the accessorial schedule with detention, appointment and re-consignment rates, and require 30 days of notice for mid-term changes.
• Budget October and November truckload at $3.44 per mile rather than on an assumed retreat.

A rate holding at $3.44 per mile and up 47% year on year, through a 15% drop in volume, is the clearest signal a procurement team gets that the market is capacity-tight rather than demand-led. That changes the negotiation. In a soft market you wait, tender late and take the spot rate; here, waiting costs money every week and the carrier knows it. The intermodal contract rate at $1.80 per mile, up 3.5%, is the only genuinely cheaper lane in the report and the one with the most room for a contract conversation. The decision is the split between contracted truckload, contracted intermodal and spot, plus the fuel clause that governs all three.

Assume 40 truckloads a month on an 850-mile lane. Spot at $3.44 per mile is $2,924 a load, $116,960 a month and $1,403,520 a year. A contract at an assumed $3.05 per mile is $2,592.50 a load, $103,700 a month and $1,244,400 a year, a saving of $159,120. Now the intermodal option on the same lane: $1.80 per mile is $1,530 plus roughly $900 of drayage at both ends, so $2,430 a load, which is $494 below the spot rate. Moving 15 of the 40 loads to intermodal saves $7,410 a month and $88,920 a year for about a day and a half. The truckload contract looks the bigger prize, but it carries a volume commitment. If you commit 40 loads and tender 30, and unused committed volume is billed at half rate, that is $1,296 a load on 10 loads, $12,960 a month, which eats the saving quickly.

By 11 September, put a year of lane data into a single table, covering miles, loads, mode, rate and accessorials, and calculate the true all-in cost per load rather than the linehaul rate. By 15 September, ask for two quotes per lane: truckload with committed volume and a shortfall tolerance, and intermodal ramp to ramp with drayage shown separately. By 22 September, fix the fuel clause in writing against the $5.60 a gallon diesel reference: the rate adjusts by roughly $0.015 per mile for every $0.10 a gallon move, settled monthly against a named publication and a named reference week, with a stated cap and a stated floor.

By 26 September, convert 15 loads a month to intermodal on the lanes where drayage is under $900 and the transit tolerance is at least two days, and hold the truckload contract for the volume you are confident of tendering. By 30 September, attach the accessorial schedule to the contract with detention, appointment and re-consignment rates stated, and require 30 days of notice for any mid-term change.

The alternatives are a spot-only position, a broker-managed spot programme with a rate cap, a dedicated fleet for the most predictable lanes, or a full intermodal conversion on the long lanes. A dedicated fleet converts a rate you cannot control into a fixed cost you can, which works when the volume is steady across all twelve months and fails when it is not. A spot-only position is cheapest until the peak week. The pitfalls are in the clauses. A contract rate with an unrestricted accessorial schedule is a spot rate with extra steps.

A fuel surcharge on a carrier-chosen baseline and a carrier-chosen week is not a hedge. An intermodal rate that looks $494 a load cheaper on paper stops being cheaper when the ramp is more than two hours from the destination and drayage doubles. And a 15% volume drop with a flat rate means the next move in the rate, when it comes, will come from the supply side rather than from your volumes, so build the October and November budget on $3.44 rather than on a hoped-for retreat.

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