<body><div><img src="https://img.particlenews.com/image.php?type=thumbnail_580x000&amp;url=3etD6b_0vKOHZm000" alt="https://img.particlenews.com/image.php?url=3etD6b_0vKOHZm000" width="1229" height="641" ><div style="position:relative;width:100%; height:0; padding-bottom: 56.25%;"><iframe src="https://www.youtube.com/embed/3d_flbGZ4Es?feature=oembed" allowfullscreen frameborder="0" style="width:100%; height:100%;top:0; left:0; position:absolute"></iframe></div><p>Freight is cyclical at its core. There are good years and bad years and market corrections. Sometimes market corrections last a lot longer than they should, which is what the freight market is experiencing right now.</p><p>On this episode of WHAT THE TRUCK?!?, Reliance Partners Chief Revenue Officer Thom Albrecht joins host Dooner to break down the future of freight markets and when they think the market will finish its correction and return to equilibrium.</p><p>Albrecht says: “Since the Fourth of July we’ve slipped back into this uncertainty. I think the polarizing nature of this election, the fact that the Fed has signaled they will be cutting interest rates has given reason to pause and wait for that. It feels like things have slowed down in the last eight weeks or so.” </p><p>In the middle of August, Fed Chair Jerome Powell indicated that a sizable interest rate cut would be coming at the Sept. 18 meeting but the size of the cut wouldn’t be decided till after Labor Day. Overall the Fed has viewed the slowing of inflation as a positive indicator, and the anticipation of the rate cut is believed to be the soft landing the economy needs. </p><p>Reliance Partners has looked at the past three previous presidential election cycles that had corrections after a strong freight market. Those years would be 2003-2006, 2014 and 2018. Albrecht said, “We looked at how long the correction was after those good freight environments. The correction was longer than the recovery. In 2014 the recovery was 17 months and the correction was 21 months. Similar in 2018.”</p><p>The most recent good cycle for freight is loosely defined as July 1, 2020, through June 30, 2022 – just a few months after early reports of an imminent freight recession. </p><p>As for when freight rates can see a break, that’s a different story. </p><p>Albrecht said: “We’ve given a lot of thought as to how the cycle will end. We’re past the two-year anniversary of being in a correction. Previous cycles were 20% longer for the correction than recovery. Going off that, the market could be in equilibrium this October. There is an alternate plan that could be longer of 40% recovery which takes us to February 2025. I’m learning more towards equilibrium by February/March of 2025.”</p><p>Everything has become a waiting game of survival for carriers as operating margins are razor-thin. There is a large amount of import goods headed to the U.S., which often is a signal of improvement to the market. It all seems to come down to peak season and how shippers and carriers react to consumer behavior.</p><p>Early predictions for consumer behavior are that shopping will start earlier. The Bazaar Voice found that “More than half of people will begin holiday shopping in October or earlier (55%), more than a third will start in September or earlier (37%), and almost a quarter will start in August or earlier (23%). And for a quarter of shoppers (26%), it’s never too early to feel the holiday moods.”</p><p>The good news is that when the course correction comes in October or spring of 2025, Albrecht says, “Once we get back to equilibrium, the market doesn’t usually flip immediately. It hangs around equilibrium for 4-6 months, then there’s a flip. Once that flip occurs, the marketplace will move quick and fast.”</p></div></body>

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Freight is cyclical at its core. There are good years and bad years and market corrections. Sometimes market corrections last a lot longer than they should, which is what the freight market is experiencing right now. On this episode of WHAT THE TRUCK?!?, Reliance Partners Chief Revenue Officer Thom Albrecht...

Navigating market uncertainty in 2024

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Freight is cyclical at its core. There are good years and bad years and market corrections. Sometimes market corrections last a lot longer than they should

Navigating market uncertainty in 2024

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