“We’re in the third year of this extended freight recession and the pain is real,” says Andy Owens, A&M Transport President. “Operating costs in trucking climbed to their highest ever at the same time that freight pricing has bottomed out.”
This can have significant ramifications because the food industry relies heavily on trucking to support its supply chains, according to Rebecca Brewster, President and Chief Operating Officer with American Transportation Research Institute (ATRI). Owens is Chairman of ATRI’s Research Advisory Committee.
At the recent annual Food Shippers Conference, Brewster identified trucking’s leading issues according to ATRI’s recently released 21st annual Top Industry Issues report. She says this year’s list includes the economy, lawsuit abuse reform, insurance cost and availability, and truck parking availability. She notes the list also debuts four first-time issues including English language proficiency for drivers and artificial intelligence (AI) use in trucking.
More than 4,200 trucking industry stakeholders participated in this recent survey, a 14% increase over the previous survey. Respondents included motor carriers, truck drivers, industry suppliers, driver trainers, and law enforcement.
Now three years into a historic freight recession, freight rates and tonnage have remained stagnant across the industry at the same time that per-mile costs increased considerably faster than inflation. This “perfect storm,” which has squeezed fleet operating margins and necessitated extensive cost-cutting measures, is of significant concern to food shippers that heavily rely on trucking for transport of their goods and materials and multi-temperature shipping capabilities.
Meanwhile, conditions in the broader U.S. economy became markedly more uncertain last year, according to ATRI’s report. Manufacturing production surpassed 2024 levels but not 2022 levels, and housing starts continued to falter, primarily due to higher mortgage rates. The labor market cooled, with unemployment reaching 4.3% last August for the first time since 2021. Monthly inflation rates remained under 3% despite trending upward since last April, but disposable personal income growth decelerated. Retail sales rose over the summer months, but in August retail sales growth surpassed that of disposable income — mostly driven by record-high consumer debt levels, with the consequence possibly being limited retail sales going forward.
In this adverse operating environment, the rising cost of risk looms large. Last year, insurance premiums rose by an additional 3% per mile in 2024, consolidating the previous year’s 12.5% increase, and additional data suggests that renewals in the first half of 2025 rose by nearly 10%. Despite preliminary data suggesting a fourth straight annual decrease in large truck crashes, insurers continued to experience unprofitability in the commercial auto segment due to rising loss severity, increasing claims costs, and social inflation’s impact on litigation. In response, litigation reformers notched victories in nine states thus far this year – including damages caps, eliminating phantom damages, and third-party litigation funding disclosures – but still face counter reform headwinds from the plaintiff bar.
Total trucking employment and driver employment specifically continued to fall year-over-year amid layoffs, market exits and bankruptcies, according to ATRI’s report. Unfortunately, the challenging economic conditions keep these freight capacity reductions from translating into improved rates.
Federal policy changes generated new uncertainties and opportunities for trucking. Tariffs and ambiguity over their implementation have the potential to contribute to inflation and influence consumer demand over the coming year. The Environmental Protection Agency (EPA) acted to rescind various vehicle emission rules pertaining to NOx, electric vehicle mandates, and the EPA’s authority to regulate emissions altogether.
Amid a flurry of its own regulatory activity, the U.S. Department of Transportation also has set new English language requirement guidelines for truck drivers that have already had a measurable enforcement impact.
“English language proficiency for drivers has obviously grabbed a lot of media headline attention,” says Brewster. “It’s been on the books for years, but it has not been enforced and is now once again being enforced under the Trump Administration executive orders.”
The trucking industry continues to face severe challenges and upheavals which will directly impact food supply chains. Responding to these challenges will require the collective efforts of motor carriers and food shippers, state and federal associations, governmental agencies, and industry suppliers.
To download a copy of ATRI’s 21st annual Top Industry Issues report, visit truckingresearch.org.
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