The Freight Recession May Be Ending - But Not for the Reason You Think

For more than three years, the trucking industry has been waiting for freight demand to come roaring back.

What if it doesn’t have to?

The newest market data is pointing to something more complicated — and potentially more important for shippers.

Manufacturing is still growing, but more slowly. Freight volumes are not exploding. Some short-term indicators have cooled from their summer highs.

Yet truck capacity remains tight, spot rates are still dramatically higher than a year ago, newly negotiated contract rates are moving higher, and diesel just jumped nearly 37 cents in a single week.

The market may be turning because the number of trucks competing for freight is changing faster than the amount of freight itself.

This Week at a Glance

📦 Freight Demand: Mixed / stronger than last year, but not booming

🚛 Truck Capacity: Still tight, with early signs some capacity may be returning

💰 Spot Rates: Up last week; still roughly 39% - 42% above year-ago levels across major equipment types

📈 New Contract Pricing: Moving higher across dry van, reefer and flatbed

⛽ Diesel: $5.967/gallon - up 36.8¢ in one week

🏭 Manufacturing: Still expanding, but growth slowed in August

👷 Driver Pay: Down for a second straight month, but still above last year

⚠️ Longer-Term Risk: Freight does not need to boom for transportation costs to remain elevated

Freight Isn't Booming. Capacity Is Still Tight.

August's Logistics Managers' Index showed transportation capacity at 40.0. Anything below 50 indicates contraction.

Transportation utilization, meanwhile, climbed to 70.6, its second-highest reading in two years, while transportation pricing reached 90.0.

In plain English:

The available trucking network is being used heavily, capacity is still shrinking, and transportation costs are rising.

DAT described the situation this week as capacity tightening faster than demand is easing.

That distinction matters.

A freight market does not require a massive increase in freight to become tight. If the pool of available trucks declines faster than freight volume declines, shippers can still face higher rates and more difficult coverage.

Spot Rates Turn Higher

Truckstop/FTR reported that for the week ending September 4:

Available loads fell 6.9%

Available trucks fell 2.2%

Overall spot rates increased 1.7%

The Labor Day period normally produces some seasonal rate strength, so we should not treat one week as the beginning of another rate surge.

But the year-over-year comparisons remain hard to ignore:

Dry van: nearly 39% higher

Reefer: nearly 42% higher

Flatbed: nearly 41% higher

Rates cooled from summer highs.

They did not return anywhere close to last year's levels.

DAT's own short-term forecast also suggests pricing may soften somewhat through the fall while maintaining a considerably higher floor than last year — something DAT connects partly to tighter equipment availability.

The Contract Market Is Now Moving Too

This may be one of the most important developments of the week.

DAT's New Rate Development data tracks newly negotiated contract freight entering routing guides - essentially pricing from recent bids and RFPs.

The latest readings were:

Dry Van: +8.4%

Reefer: +8.8%

Flatbed: +9.1%

DAT says shippers are still accepting higher rates on newly negotiated freight even though the pace of increase has cooled somewhat over the past few weeks.

That matters because spot pricing normally reacts first when capacity tightens.

Contract pricing follows later.

We are now seeing evidence that the market turn is beginning to show up in both.

Is Capacity Finally Coming Back?

There is one new development we need to watch closely.

OTR Solutions reported:

3,487 new or reinstated carrier authorities in August

versus

1,470 revoked authorities

That produces a net increase of:

+2,017 carrier authorities

That could be an early sign that higher freight rates are attracting trucking companies back into the market.

But an operating authority is not the same thing as an additional truck.

A carrier can reactivate an authority using equipment that already existed. Some new authorities may add very little meaningful freight capacity.

And current truck-availability data does not yet show a broad loosening.

Truckstop reported available truck postings declined another 2.2% last week, while the LMI still showed transportation capacity in contraction.

So our read is:

There are early signs that better rates are attracting carriers back into trucking, but we do not yet see enough evidence to say capacity has meaningfully loosened.

September and October will tell us much more.

Available Trucks Still Aren't the Same as Available Qualified Trucks

Government enforcement remains an important part of the capacity discussion.

The federal government has expanded scrutiny beyond individual drivers to include CDL schools, third-party testers, driver eligibility, carrier operations and equipment safety.

Recent actions have included the removal of more than 110 CDL training schools from the federal registry, additional schools facing removal, audits of third-party testing programs and expanded enforcement on major freight corridors.

State safety operations are also finding serious equipment problems.

In one targeted Texas Permian Basin operation:

351 commercial vehicles were inspected

1,935 violations were identified

167 vehicles were placed out of service

34 drivers were placed out of service

That is a 47.6% vehicle out-of-service rate within that targeted operation.

Calculation:

167 ÷ 351 = 47.58%

This does not mean nearly half of all trucks nationwide are unsafe. This was a targeted enforcement operation.

But it reinforces an important point:

A truck existing on paper does not necessarily mean that truck is legal, compliant, properly equipped and immediately available to haul a customer's freight.

Qualified capacity matters more than raw truck counts.

A Real-World Example: California Produce

DAT reported something particularly interesting in California.

Produce volumes were approximately 10% lower, yet several California produce markets moved from an adequate supply of trucks to a slight shortage or shortage.

DAT described the change simply:

“Trucks just simply evaporated.”

Brake Safety Week appears to have contributed to the sudden pullback in available equipment.

That's the freight market in miniature.

Less freight does not automatically mean cheaper trucking.

If trucks disappear even faster, the market still tightens.

Diesel Jumps 36.8¢ in One Week

This week's EIA diesel number deserves special attention.

U.S. on-highway diesel moved from:

$5.599 on August 31

to

$5.967 on September 7

That's an increase of:

$0.368 per gallon

or approximately:

$0.368 ÷ $5.599 × 100 = 6.6% in one week

Compared with one year ago, diesel is $2.201 higher per gallon.

Last year's implied price:

$5.967 - $2.201 = $3.766

Year-over-year increase:

$2.201 ÷ $3.766 × 100 = 58.4%

For a truck purchasing 1,000 gallons:

1,000 × $0.368 = $368 more fuel expense than one week earlier.

And that cost doesn't stop with the trucking company.

It eventually affects manufacturers, distributors, retailers, construction companies and consumers.

Manufacturing Is Still Growing - Just More Slowly

The ISM Manufacturing PMI registered 54.6 in August.

Anything above 50 indicates expansion.

That means U.S. manufacturing has now expanded for eight consecutive months, although August slowed from July.

There are some warning signs:

New Orders: 53.7

Production: 58.3

Backlogs: 51.8

Prices: 71.1

Employment: 51.2

Manufacturers also reported that customer inventories remain relatively low, which can support future replenishment and freight activity.

DAT characterized manufacturing as generating freight, but not yet “shooting out of a cannon.”

That's a good description of the current market.

There is freight.

There is industrial activity.

But this is not a demand explosion.

Small Businesses Are Feeling the Cost Pressure

The latest NFIB survey showed small-business optimism falling amid inflation, weaker sales and supply-chain concerns.

Nearly half - 47% - reported few or no qualified applicants for available jobs.

And 31% said they had raised their average selling prices, with roughly the same share planning additional increases.

The common thread is costs.

Higher energy, labor, equipment and transportation expenses are occurring even while portions of the economy are slowing.

That creates a difficult environment for shippers:

You can have slower economic growth and still experience higher transportation costs.

Driver Pay Is Sending a Mixed Signal

The Superior Trucking Payroll Service Driver Pay Index declined to 158.08 in August.

That's:

-2.0% from July

and the second consecutive monthly decline following June's record high of 170.04.

But driver pay remains approximately 6.2% above August 2025.

Because this index measures actual payroll rather than simply cents per mile, lower payroll could reflect fewer miles, different bonuses, freight availability or compensation changes.

So we cannot conclude from this data alone that driver wage rates are falling.

It does, however, add to the growing evidence that some of the extreme pressure seen earlier this summer is moderating.

New-Truck Orders Are Booming - But That Doesn't Automatically Mean More Capacity

Class 8 truck orders remained strong in August.

Orders were:

42% above August 2025

and through August were:

111% above the same period last year

Much of that demand was tied to fleets buying ahead of expected 2027 engine-cost increases.

FTR estimates new engine requirements could add roughly $6,000 to $12,000 per truck, depending on the compliance path.

For a fleet buying 100 trucks:

100 × $10,000 = $1,000,000

That provides a strong incentive to buy earlier.

And remember:

Replacing 100 old trucks with 100 new trucks adds zero net capacity.

So strong truck orders should not automatically be interpreted as a major expansion of the trucking fleet.

What We're Watching Next

The market appears to be entering a transition.

The freight recession of the past several years is losing its grip, but the replacement isn't a traditional freight boom.

Instead, we're seeing a market shaped by:

Tighter qualified capacity

Higher fuel costs

Rising newly negotiated contract rates

Strong equipment replacement

Government enforcement

Moderate manufacturing growth

Regional differences in truck availability

and potentially new carrier entry as economics improve.

The key question for the next several weeks is whether new capacity enters quickly enough to offset the trucks and operators leaving - or whether the market remains structurally tight heading toward the holiday season.

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By the Numbers

54.6 - August ISM Manufacturing PMI

40.0 - LMI transportation-capacity index; below 50 indicates contraction

70.6 - transportation utilization

90.0 - transportation pricing index

+2,017 - net carrier-authority increase reported by OTR for August

+36.8¢ - one-week increase in U.S. diesel

$5.967 - national on-highway diesel average

+58.4% - approximate year-over-year increase in diesel

~39% - 42% - current spot-rate premium versus last year across the three principal truckload equipment types

Bottom Line

The freight market is no longer behaving like the freight recession we've grown accustomed to.

Demand isn't booming.

But capacity remains tight, qualified capacity is being scrutinized more closely, diesel is nearly $6 per gallon, and newly negotiated freight is repricing higher.

For shippers, the takeaway is simple:

Don't wait for headlines about a freight boom before preparing for higher transportation costs.

The market may already be changing underneath us.

Sources: DAT Freight & Analytics / DAT iQ • Truckstop.com • FTR Transportation Intelligence • Logistics Managers’ Index (LMI) • OTR Solutions - TrueFreight Brief • U.S. Energy Information Administration (EIA) • Institute for Supply Management (ISM) • National Federation of Independent Business (NFIB) • Superior Trucking Payroll Service / AscendTMS • ACT Research • Federal Motor Carrier Safety Administration (FMCSA) • U.S. Department of Transportation (DOT) • Commercial Vehicle Safety Alliance (CVSA) • FreightWaves • Manufacturing Dive