Summer Surface Chill: A Deep Dive into DAT's July Trucking Volume Index
While summer heat scorches the earth, creating an illusion of dormancy across nature, the trucking freight market hasn't escaped this seasonal slowdown. Yet this cooling trend signals not recession, but rather the natural rhythm of market cycles. DAT Freight & Analytics, the authoritative voice in trucking data analysis, has released its July Trucking Volume Index (TVI) report, revealing the market's underlying pulse beneath superficial appearances.
This comprehensive report serves as a clear mirror reflecting volume changes across dry vans, refrigerated trucks, and flatbeds. Using January 2015 freight volumes as its baseline (indexed at 100), DAT's standardized methodology eliminates distortions from new data sources, ensuring both accuracy and reliability. More than mere statistics, this report embodies DAT's commitment to data integrity and responsible industry stewardship.
Demand Softening: Seasonal Adjustments Drive Broad Declines
July witnessed widespread volume decreases across all truck types—not coincidental fluctuations but predictable seasonal patterns. Summer typically brings reduced consumer demand and adjusted production cycles, naturally depressing freight volumes. Yet within this broad decline, certain bright spots emerged, notably refrigerated TVI reaching its highest July level on record, showcasing the market's inherent complexity.
Dry Vans: Traditional Workhorses Facing Demand Challenges
The dry van TVI dropped 7.0% monthly to 226, down 3.0% annually. These figures reflect softening consumer demand and manufacturing slowdowns. Amid economic pressures, businesses prioritize cost control through inventory reductions, directly impacting dry van demand. Nevertheless, these vehicles remain indispensable, transporting goods that permeate daily life.
Refrigerated Units: E-commerce's Cold Chain Accelerator Hits Record Highs
Refrigerated TVI declined 3.4% monthly to 169 but rose 1.2% annually. Despite the monthly dip, DAT notes this marks refrigerated transport's strongest July performance ever, fueled by perishables, frozen goods, metals, machinery, building materials, and seasonal commodities. The explosive growth of fresh food e-commerce continues driving reefer demand as consumers prioritize food safety and freshness, spurring cold chain logistics advancements.
Flatbeds: Infrastructure's Barometer Feels Seasonal Impact
Flatbed TVI plummeted 12.8% monthly to 238, though up 3.5% annually. Specializing in heavy equipment and construction materials, flatbed demand directly correlates with infrastructure investment. July's high temperatures and rainy conditions depressed project starts, sharply reducing transport needs. However, anticipated infrastructure spending increases suggest potential flatbed demand recovery later this year.
Rate Declines: Market Responses to Shifting Dynamics
Freight rates directly mirror supply-demand relationships. July saw continued spot market rate erosion and contract rate softening, indicating carrier oversupply and shipper negotiating leverage. Rising fuel surcharges partially offset rate declines, maintaining pressure on carrier profitability.
Spot Rates: Short-Term Supply-Demand Tug-of-War
Dry van spot rates fell $0.01 per mile to $2.07, marking the fifth decline in six months and down $0.56 annually. Reefer spots dropped $0.03 to $2.44 per mile ($0.60 below 2022). Flatbed spots declined $0.07 to $2.54 per mile ($0.72 year-over-year decrease). Persistent spot rate erosion reflects tight supply-demand conditions where abundant capacity empowers shippers to secure lower pricing.
Contract Rates: Foundation of Long-Term Relationships
Contract rates (excluding fuel surcharges) followed downward trends. Dry van contracts fell $0.02 to $1.63 per mile; reefers declined $0.05 to $1.96; flatbeds dropped $0.09 to $2.01. These negotiated rates form the bedrock of shipper-carrier partnerships, with current reductions signaling broader market deterioration as cost-conscious shippers pressure carriers for concessions.
Fuel Surcharges: Partial Cost Recovery Mechanism
July's average fuel surcharges rose modestly: dry vans increased $0.02 to $0.44 per mile; reefers reached $0.48; flatbeds $0.53. These carrier cost-recovery tools provide partial rate-decline mitigation, though insufficient to fully compensate for revenue erosion, leaving carriers financially strained.
Capacity Oversupply: Intensifying Competition Signals
The load-to-truck ratio serves as a critical capacity metric. July's ratio declines across equipment types confirm oversupply and heightened competition. Excess capacity leaves carriers struggling to secure sufficient loads, depressing incomes and operational viability.
Dry Vans: Balanced Yet Competitive
The national dry van load-to-truck ratio held steady at 2.6 (2.6 loads per posted truck), matching June but below July 2022's 3.8. This equilibrium masks intense competition where carriers must enhance service and efficiency to remain viable.
Reefers: Strong Demand Meets Tight Capacity
Refrigerated ratios maintained at 3.8 (June: 3.8; July 2022: 7.2). Strong perishables demand keeps reefer capacity relatively tight, with growth prospects tied to e-grocery expansion.
Flatbeds: Demand Collapse Creates Glut
Flatbed ratios plunged to 7.1 (June: 9.7; July 2022: 21.8). Infrastructure slowdowns created severe oversupply, forcing flatbed operators to seek alternative revenue streams.
Expert Analysis: Ken Adamo's Market Perspective
DAT Chief Analyst Ken Adamo's insights illuminate underlying market mechanics:
"Shippers face port and LTL disruptions but secure adequate dry van capacity without significant rate or volume fluctuations. Remember, spot rates are all-in prices excluding separate fuel surcharges—a risk mitigation strategy. Negotiating individual shipments requires careful fuel and operational cost consideration, particularly challenging amid seasonal slumps when fuel spikes strain small carriers."
Adamo describes July's "two-month story"—strong openings followed by progressive softening, with true peak activity potentially delayed until late August or September. He notes parallels to 2019's extended downturn, suggesting current conditions may persist through fall.
Regarding pricing dynamics, Adamo explains: "This period represents pricing's most unstable phase—you anticipate market recovery within a 12-month contract window but can't pinpoint timing or magnitude precisely. Current carrier and broker communications essentially signal to shippers: 'We'll quote higher rates now anticipating imminent market rebounds, even absent immediate justification.'"