Trucking capacity is tightening due to regulatory pressures and driver challenges, not just demand, according to FreightWaves. The divergence between spot rates and diesel prices supports the thesis that tight capacity—not fuel costs—is sustaining elevated freight rates. The Sonar NTI sat at $3.51 per mile as of the latest reading, climbing back from a mid-to-late June low near $4.90, while the diesel price at truck stops registered $3.48 per gallon, down from a July high near $3.80.
Tender Rejections Remain Elevated Across All Modes
Tender rejections remain well above historical norms across all modes, according to Sonar data. The Sonar Truckload Rejection Index (STRI) stands at 14.36%, above the six-month average of roughly 10.9%. Flatbed is the tightest mode at 23% rejections—down sharply from the 40% range seen in June and early July but still historically elevated. Reefer rejections sit at 19.46%, or nearly one in five loads, while van rejections are running nearly 50% above year-ago levels.
| Mode | Rejection Rate | Historical Context |
|---|---|---|
| STRI (overall) | 14.36% | Above 6-month avg ~10.9% |
| Flatbed | 23% | Down from 40% range in June/July |
| Reefer | 19.46% | Nearly 1 in 5 loads rejected |
| Van | ~50% above year-ago | Not specified |
Carrier Earnings Reinforce the Capacity-Constraint Narrative
Recent carrier earnings reinforce the capacity-constraint narrative. Knight-Swift reported that its truckload segment operating income rose 69% year over year, with the carrier noting that strategic pricing recovery accelerated in June as recent bids took effect. The company described rapid tightening in supply-driven dynamics and tender rejections reaching levels not seen since 2021.
Werner CEO Derek Leathers said the company’s organic dedicated business is growing, and revenue in both Werner’s and J.B. Hunt’s dedicated and truckload segments improved. The gains are coming from mode shift and share shift rather than a broad demand recovery, with J.B. Hunt reporting significant intermodal growth and strong intermodal results appearing across carrier earnings broadly.
Regulatory and Driver Challenges Intensify Squeeze
Regulatory pressures are removing shadow capacity as ELD (Electronic Logging Device) providers exit the market alongside ongoing driver and CDL (Commercial Driver's License) school removals—so impacting capacity and the quality of driver availability, according to FreightWaves' reporting on Werner's commentary. Driver recruiting headwinds are intensifying the capacity squeeze. A tight market gives drivers more options, and regulatory enforcement is raising barriers to entry and complicating retention efforts.
Nuclear Verdicts Reshape Shipper Behavior
Rising nuclear verdict exposure is also reshaping shipper behavior. Shippers are increasingly moving freight to well-established asset-based carriers to limit liability, fraud, and cargo risk—a dynamic expected to benefit carriers with large dedicated fleets through the remainder of 2024 and into 2025.
Watch List: Capacity Outlook Through Fall and Beyond
With capacity continuing to exit the market and no significant fleet additions visible in large-carrier earnings, the market is expected to remain tight through fall and into the next year. Key factors to monitor include further regulatory enforcement actions, driver recruiting and retention trends, and any shifts in demand that could alter the supply-demand balance.
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