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Truck tonnage declined sequentially in both November and December, marking the first consecutive-month fall since March and April. (THEPALMER/Getty Images)

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The freight market finished 2024 on a downward slope as tonnage declined on a monthly and annual basis in December, reported.

The ATA For-Hire Truck Tonnage Index decreased 1.1% to 111.3 last month from 112.6 in November and declined 3.2% compared with December 2023 on a seasonally adjusted basis. All of 2024 marked a mix of sequential increases and declines, with the market still searching for stability as carriers continue to contend with sluggish volumes.

“For the first time since March and April, truck tonnage contracted for two consecutive months,” ATA Chief Economist Bob Costello said in a Jan. 21 release. “Tonnage fell 1.8% in November, bringing the two-month total decrease to 2.9%, pushing tonnage to its lowest level since January 2024. Sluggishness in factory output continues to weigh on freight volumes, but another drag on the index has been fleet growth at private carriers, which is holding back how much freight is flowing to for-hire carriers.”

Not adjusting for seasonality, tonnage declined 0.9% sequentially to 108.8 in December, which followed a revised 1.8% drop in November. ATA calculates its monthly tonnage index based on feedback from contract freight. In calculating the index, 100 represents 2015.

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President Donald Trump winning his second nonconsecutive term has spurred optimism and uncertainty from businesses in recent months. His stance on lowering regulations has been well-received from the business community, but his threats to keep levying tariffs may lead to uncertainty with businesses moving goods early.

“Right now, the mood of the consumer, and the mood of the businesses, is really bullish since the election happened, and there are two reasons for that,” said Rajeev Dhawan, director of the Economic Forecasting Center at Georgia State University. “One is the stock market has done really well in the last few months. If you take it over the last two years, it’s like a 40% rise on average. That always makes the consumer feel good, no matter what other things are going on.”

Dhawan indicated that this can lead to a tendency to spend more on things like travel and buying big-ticket items. Because of that, he expects spending to improve over the next six months. In addition, he sees small businesses taking a brighter outlook.

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“The small business optimism has taken a big upturn in the last few months since the election because small businesses always like hearing less regulation,” Dhawan said. “Which means that they are expecting a big recovery on spending from the consumers, so they will start gearing up.”

Dhawan added that there still are many unknowns when it comes to the prices of goods. That is because goods, as opposed to services, could be impacted more by tariffs, including a 25% levy on goods from Canada and Mexico.

“We know there are going to be tariffs; we don’t know when,” Dhawan said. “The tariff game has started now, and it’s in the first round. Once the tariff game picks up speed, which according to me, would be another two to three months, that’s when we will know how things are going to go in the long term.”

Dhawan noted that the tariff threats have led to more trade on goods like crude oil from Canada. Businesses have been preparing for the incoming administration, including bringing cargo in early if they are able to.

“We import about 4 million barrels per day of crude from Canada, so that demand has already gone up,” Dhawan said, “which means more is flowing through the pipelines, more is coming through the railroads. So things like that are happening, and you already saw from the port data in Los Angeles, Long Beach and even Savannah, the three big ports, that the tonnage shot up year over year 15% to 20% in the fall because people were front-loading their orders.”

The report registered 57.3 for December compared with 58.4 in November. The slowdown was blamed on the seasonal wind down in inventory levels. The report noted that inventory levels increased for upstream firms, such as manufacturers, wholesalers and third-party logistics companies benefiting from the import surge. But downstream, retailers are reporting significant contractions.��

“Interestingly, transportation prices are up (+3.0) to 66.8, which is the fastest rate of expansion for this metric since April of 2022,” LMI said in its December report. “This also puts transportation prices above the all-time average of 65 for this metric for the first time in over 2.5 years. This is likely a function of the strong consumer sales we have seen throughout the second half of 2024.”

The reported that shipments decreased 6.5% year over year to 1.007 from 1.077. It also decreased 7.3% from 1.086 in November. The report concluded that ongoing capacity additions are keeping pressure on the for-hire market.

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