1st Quarter 2008 Freight Broker Trends

I report to you from the trenches on the front lines of the brokerage industry, giving you up to date information on what I see.

Although the big rig called the U.S. economy appears to have hit the air brakes, it might be more akin to it hitting the jake brake. For our company, January was a very good month with great revenue weeks, besides the first week of the year. Was the freight held over from the end of 2007 with the slow shipping weeks of Christmas and New Years? Possibly. Or it could be a good push off for the beginning of 2008 that could stall out in February.

I recently had a customer call me to propose a 3% rate reduction for 2008, and if most of their core carriers agree to do so this customer will not put their freight out to bid until 2009. It protects the business for a year and guarantees (a word I never like to use in the transportation business) that the customer will reduce cost in their transportation department. For the record-we are on board and hope the rest of the core carriers vote aye with us.

Most of the forecasts I have seen or heard about call for the freight recession to make its rebound in the 1st quarter of 2009, which means more rate reductions are in line for the brokerage industry. The company I work for has been around since the early 80s and lucky for me, we have experienced slower trends before. We will rate joust with the best of them if the business is deemed worthy, so look out CH Robinson.

Mumblings and Rumblings about Rates-the lowdown on the cheapes rates I have heard
SC/NC to CA $.94/mile + fuel surcharge
SC/NC to TX $1.02/mile + fuel surcharge
SC/NC to IL $1.05/mile + fuel surchage
Talk about cheap. These prices are reflective of rates seen in the early 1990s. If this continues we will all be wearing Members Only jackets and parachute pants (both popular styles in the 80s).