Truckload rates decelerated in April, rising 6.9 percent year-over-year, compared with a 7.4 percent increase in March, according to Cass Information Systems.
On a sequential monthly basis, truckload rates were flat in April from March, with a freight shift to intermodal rail keeping truckload rates stable, Cass said Friday.
The Cass Truckload Linehaul Index has been slipping since January, when it ticked up slightly from December to 109.4. By March, it had dropped to 108.2.
That deceleration points both to slower economic growth and competition from intermodal rail, which saw rates jump 2.1 percent from March to April.
The Cass Intermodal Linehaul Index rose 2.4 percent from a year ago, its first year-over-year increase since December, climbing to its second highest value ever.
For the first 18 weeks of 2012, U.S. intermodal rail shipments were up 2.8 percent year-over-year, rising 3 percent from a year ago in the week ending May 5.
Truckload carrier executives say their pricing must rise to help cover higher operating costs that threaten their margins and ability to invest in new capacity.
“We’re facing a lot of headwinds in all areas of cost,” Dan England, chairman of C.R. England, said at the National Industrial Transportation League policy forum.
“I need a 5 to 7 percent increase in my rates,” John White, president of U.S. Xpress, told shippers at the NASSTRAC 2012 Logistics conference in Orlando May 1.
While many investment analysts predict truckload rates to rise in the 2 to 4 percent range, Avondale Partners believes truck pricing could trend much higher.
“We continue to believe 6-9 percent rate increases are possible for 2012” as capacity and demand collide, Avondale Partners said in a comment on the Cass index.