Truckload (TL) and less-than-truckload (LTL) rates are set to hit new highs in the third quarter as the freight industry recovery from a nearly four-year downturn accelerates, according to a July 14 report from 3PL AFS Logistics and financial services firm TD Cowen. Capacity constraints, a surge in diesel fuel prices, and strong carrier pricing power are driving index levels to cycle highs, with implications for shippers and logistics operators across North America.
TL Rates at 14-Quarter High
The TL rate-per-mile component of the TD Cowen-AFS Freight Index hit a 14-quarter high in the second quarter, coming in at 16% above the January 2018 baseline. That reading was 6.6 percentage points higher sequentially and 10.1 points higher year over year. The report expects the index to increase to 17.7% above the baseline in Q3, which would be 11.7 points higher year over year.
| Metric | Q2 2026 vs Baseline | Q3 2026 Forecast vs Baseline |
|---|---|---|
| TL rate-per-mile index | +16.0% | +17.7% |
| Sequential change | +6.6 pp | – |
| Year-over-year change | +10.1 pp | +11.7 pp |
More than 48,000 non-compliant drivers have been forced out of the industry over the past year, according to the report. Small carriers, facing tight margins and fuel price headwinds, may be parking trucks until fuel prices recede. "Smaller truckload carriers working on tight margins may park trucks and wait for fuel prices to revert to more palatable levels before returning to operation, further restraining capacity amid a supply-side market correction," said AFS Logistics CEO Andy Dyer.
At an investor conference last month, management teams from public TL carriers reported that mini-bid activity has spiked as routing guides crumble. Contractual rates set early in the 2026 bid season proved too low, and carriers are now eyeing double-digit contractual rate increases this year and next to restore margins. TL linehaul cost per shipment increased 3.1% sequentially in Q2 even though miles per shipment fell 1.8%. The report noted an increase in shipments of 500 miles or less, as some longer-haul moves shifted to cheaper intermodal options.
LTL Rates at All-Time High
LTL rates surged to an all-time high in the second quarter. The LTL rate-per-pound component of the index stood 76.5% above the 2018 baseline, up 9.6 points sequentially and 13.3 points year over year. Fuel surcharges captured by the dataset were more than 60% above the June 2025 benchmark during the period, as retail diesel prices were 51% higher year over year. LTL fuel surcharge mechanisms include a step function as diesel rises, typically resulting in margin accretion.
The index is expected to increase 30 basis points sequentially in Q3, which would be nearly 10 points higher year over year.
| Metric | Q2 2026 vs Baseline | Q3 2026 Forecast vs Baseline |
|---|---|---|
| LTL rate-per-pound index | +76.5% | ~+76.8% (est. +30 bps) |
| Sequential change | +9.6 pp | +0.3 pp |
| Year-over-year change | +13.3 pp | ~+10 pp |
"Q2 showed that carriers' pricing strategies include the ability to not only secure rate increases and strategically valuable volumes, but capture volatile fuel costs," said Mich Fabriga, vice president of LTL pricing at AFS Logistics.
General rate increases (GRIs), which usually cover about one-quarter of carrier shipments, have again been pulled forward from their typical annual cadence. ArcBest (NASDAQ: ARCB) implemented a 5.9% GRI on June 22, flat year over year but installed approximately six weeks ahead of the 2025 rate hike. Saia (NASDAQ: SAIA) implemented a 7.1% GRI on July 6, 120 basis points higher and three months earlier than last year's increase.
Implications for Shippers and Operators
With TL and LTL rates both expected to climb further in Q3, shippers and logistics managers should anticipate higher transportation costs through the peak season. The accelerated GRI schedules from large carriers like ArcBest and Saia signal that LTL carriers are leveraging favorable market conditions to push through increases earlier than usual. Meanwhile, the exodus of non-compliant drivers and the sidelining of small TL carriers will keep capacity tight, supporting carriers' ability to demand higher rates. Operators should review contract renewal timing, explore intermodal alternatives for longer hauls, and ensure fuel surcharge programs are aligned with actual cost exposure to mitigate margin pressure.
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