Truckload spot rates have reached a four-year high in the first quarter, according to Freight broker RXO. Despite only tepid freight demand, capacity attrition stemming from stricter regulatory oversight of the driver pool is pushing rates materially higher. This trend is expected to continue into the second quarter, with the index forecasted to record an even larger growth rate. The impact on industry dynamics will be significant, as shippers are bracing for a highly altered freight environment heading into the busy summer months and the second half of 2026.
RXO's Curve Report showed TL spot rates were up 16.5% year over year in the first quarter after logging a 5.2% growth rate in the fourth quarter. This was the highest growth rate since the 2021 third quarter. The dataset captures linehaul rates, excluding fuel surcharges, and provides valuable insights into the freight market's performance.
The quarterly outlook calls for the index to record a larger growth rate during the second quarter. s warn that this trend is not likely to slow down anytime soon, as tender rejections were at their highest levels since 2022 and rate volatility outpaced seasonality. This suggests that shippers are becoming increasingly cautious when it comes to freight negotiations.
Contract rates were up 2.4% y/y in the first quarter. Elevated spot rates are bleeding through to contractual rate negotiations, indicating a significant shift in the dynamics of the industry. As carriers face increasing costs and regulatory pressures, they are passing these costs on to shippers in the form of higher rates.
Public carriers raised full-year contract rate expectations during the first-quarter earnings season. Many were expecting low- to mid-single-digit rate increases entering the year, but now believe market dynamics support increases in the mid- to high-single digits. This suggests that carriers are confident in their ability to pass on increased costs to shippers.
J.B. Hunt believes contract rates (non-dedicated) will climb 20% over the next two years as heightened regulation and higher fuel costs purge low-cost operators from the market. This trend is likely to have a significant impact on industry dynamics, as carriers become increasingly selective about which customers they choose to serve.
Carriers remain under immense cost pressure, driven by increasing labor expenses, a higher cost of capital, insurance premiums, and diesel prices. If there is any uptick in shipping volumes, rates will rise at an even faster pace,
s warn of a highly altered freight environment heading into the busy summer months.
