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November is here already…can you smell the turkey and dressing?
As you well know, the holiday season officially begins in November and the end of the year is fast approaching. We’re navigating the last quarter of the year — a quarter that typically means more money in your pocket due to the movement of excess holiday freight.
However, you know by now that this year is anything but normal. You can’t operate as you always have in past Novembers and Decembers and find the same level of success you once did. You’ll notice the typical freight slowdown when businesses close in observance of the holidays, but like other years, you won’t see the movement of excess holiday goods to boost your paycheck.
Here at Anderson Trucking Service (ATS), we know that an educated driver is a successful driver. That’s why we want to keep you informed on the latest market updates and help you understand how these changes impact you directly.
In this November update, you can expect to learn the following:
- October recap
- November freight rates
- November freight availability
- Supply and demand in November
- Tips for success in November
What Happened in the Trucking Industry in October?
In October, the trucking industry saw more of the same. Just like in September, we saw truckload freight, refrigerated freight and flatbed freight rates continue to underperform and decline.
Flatbed rates as a whole are still performing better than experts predicted. Over-dimensional freight has also been performing well. This is a bright spot in an otherwise bleak market.
Apart from that, October was a busy month with plenty of notable moments.
Quarter 3 earnings from publicly traded companies recently came out and showed that many companies — even the strongest trucking companies out here — have been struggling to hit performance metrics or make a profit. Many reported a loss in Quarter 3.
We also saw some companies go out of business in October. Convoy, a digital freight startup that was once referred to fondly as the “Uber for trucking,” stated that the massive freight recession was one of the primary reasons they closed. Diminished freight volume and excess capacity also played a role.
While wholly unfortunate for those employees, the company exiting the market helps others a little bit. Convoy had some trailers but was otherwise a logistics company, so it didn’t remove any capacity from the market. Traditionally, it takes a big carrier closing to change the market and make a big difference (or a lot of little ones).
After 40 years in business, Montana-based trucking company Meadow Lark Transport also shut down in early October. The company lost its broker authority in August, listed its corporate headquarters for sale in September and canceled its carrier authority in late October. Nearly 300 truck drivers are out of work after this shutdown.
Experts predict more shutdowns are coming in the next few months. A big carrier may fall, but there’s no telling who it could be.
Estes Express, a less-than-truckload freight shipping company that also dabbles in logistics and truckload and international freight, was the target of a cyber attack in early October. All systems were restored in late October, but they’re still rebuilding. This just shows how vulnerable companies can be to a cyber attack, so now is a good time to make sure your systems are secure.
Freight Rates in November
As we saw in September and October, freight rates will continue to fall. Even reefer rates, despite the upcoming holidays that are often celebrated with bountiful meals, may also continue to fall.
Here at ATS, however, we did see an increase in CPM from August to September and it held steady into October. We’re hoping to continue that pattern through November.
Freight Availability in November
Again, there’s no news here. There will be more of the same, even though we’re at the height of the holiday season and we typically see a surge in freight as retailers try to keep holiday supplies and gifts replenished.
Even though predictions show that holiday spending will surpass pre-COVID levels, stores overstocked in years past so new products won’t be moving. As long as shippers continue to hold off on restocking supply, the holiday boost isn’t going to come.
It’s important to consider the holiday slowdown that’ll come too. Many shippers will be closed in the days leading up to and the days following Thanksgiving. You can count on freight being slow from at least the day before Thanksgiving and up until Monday when they open back up.
Supply and Demand in November
We’re seeing some demand building in the market, but there’s still too much capacity (too many truck drivers for the amount of freight that’s available). We may see carriers continue to close in November, however, so there’s a chance this may change and provide more freight availability.
On the other hand, the Federal Motor Carrier Safety Administration (FMCSA) extended protections for harvest haulers under age 21. This allows younger drivers to get into trucking by giving them an exemption to serve the agriculture sector. Drivers working for a farmer hauling agriculture equipment can now cross state lines without interference from law enforcement.
This news doesn’t come without controversy. Some people see this as a good thing because it allows younger people to enter the trucking industry and make a career for themselves. On the other hand, some people worry that younger drivers aren’t responsible enough to be on the road. And it could add more drivers to an otherwise flooded industry.
Navigating the November Trucking Industry
The first of the big holidays many people celebrate is coming in just a few short weeks. That gives you three weeks to run hard before the Thanksgiving slowdown. Make the most of your days leading up to the holiday to boost your income. If you can, avoid going home for the next few weeks. Instead, save your home time for the holiday.
Some drivers may decide to take off Thanksgiving and Christmas (or another winter holiday) and many will take off one or the other. If you do decide to go home for Thanksgiving, be sure you get right back on the road following the holiday when shippers open up again and freight starts moving.
Christmas and the other winter holidays are right on the heels of Thanksgiving. Again, make sure you’ve budgeted and you’re prepped for what’s to come.
Planning your loads will help you keep running and making money. Think a few loads ahead, instead of just what your next load will be. It can be tempting to decline every load that doesn’t pay out what you want it to, but take a step back before you do that. That low-paying load could lead you into an area with a lot of high-paying freight. Check out what’s available in that area before declining a load.
Plan out a week or two in advance and look at your weekly earnings — rather than load by load — for a more realistic look at your finances.
We’re already planning for snow in Minnesota, which is a sign for everybody to start getting ready for bad weather to roll in across the country. If you don’t have your warm weather gear and winter tools in your truck already, go home now to get them.
If you haven’t gotten your truck in the shop yet for winterization, get it in the shop now. Make sure you start adding winter fuel treatment if you’ll be driving through cold states. This will prevent fuel gelling, as will filling up with a winter fuel blend (which most truckstops in the Northeast and Midwest switch to in December).
Move Forward with Confidence
November may mark the start of the holiday season, but this year is far from normal. Freight rates are expected to continue falling, even for refrigerated freight. Despite the holiday season, freight availability remains sluggish due to overstocking and supply delays.
While demand is very gradually increasing, there's still an excess of capacity, potentially leading to more carrier closures. The extension of protections for younger harvest haulers is a debated issue, offering opportunities but raising safety concerns.
To navigate November successfully, work hard before the Thanksgiving slowdown, and if you choose to go home for the holidays, get back on the road soon afterward. Planning loads strategically and preparing for winter weather are essential for a successful season in this challenging year. Adapt to the unique circumstances, stay informed and drive with confidence into the winter months.
For more success tips, check out the Drive4ATS Learning Center.