Chart of the Week: Van Contract Rates, National Truckload Index (linehaul cost less fuel over $1.20/gal) – USA SONAR: VCRPM1.USA, NTIL12.USA

Long-term (contract) rates for dry van truckload transportation (VCRPM1) have remained essentially flat over the past year, increasing roughly 1% since July 2024. Short-term spot rates (NTIL12) which are naturally more volatile, have risen about 4% over the same period. With all the talk about capacity leaving the market at alarming rates, what does this stability in contract rates mean for 2026?

In the short term, the answer is likely nothing. Contracts are unlikely to move higher soon, as there’s currently no meaningful pressure on them. Tender rejection rates remain within acceptable ranges for most shippers, and while spot rates are less reliable, they continue to offer deep discounts for those willing to pursue them.

Seasonal pressure will increase over the next few months as the holiday shipping season ramps up, but it’s difficult to see this translating into strong or sustained increases in contract rates. Demand remains extremely weak, with little evidence of improvement beyond speculation. There is, however, one important caveat.

Last week’s chart article illustrated that capacity appears to be exiting the market faster than demand is declining—something with little to no historical precedent over an extended period. The primary reason is that this freight recession has lasted longer than any in the modern era.

In the chart above, both rate lines drop sharply through most of 2022. The faster-moving spot rate hit a floor in May 2023, while contract rates found a softer bottom in 2024.

Although spot rates have been rising since 2023, they remain largely unprofitable. Contract rates have been more resilient, suggesting they are currently near the lowest sustainable levels for most carriers.

The latest American Transportation Research Institute (ATRI) report on carrier costs supports this, showing that average operating costs increased 33% from 2019 to 2024. The contract rate index (VCRPM1) is roughly 16% higher than its 2019 level—meaning the cost of operating has risen twice as fast as the rates the market has been willing to pay.

Additionally, recent regulatory actions targeting non-domiciled and undocumented drivers have intensified. U.S. Department of Transportation Secretary Sean Duffy recently stated that he plans to crack down on “CDL mills” and the fleets that use them.

This increased regulatory pressure, which began in the spring, has only recently begun to affect the rate environment. Spot rates spiked unseasonably in early October amid reports that immigrant drivers were avoiding the roads due to stepped-up ICE enforcement.

All of this adds to an already challenging operating environment and should put shippers on high alert over the next 12 months. Trucking demand has collapsed over the past year, yet rejection and spot rates have remained resilient.

This dynamic suggests that if demand returns — or even stabilizes — the market could quickly flip, pushing long-term rates higher again. Shippers should focus on the quality of their carrier partners rather than just cost savings, as the rates negotiated today are likely to become outdated before the next bid cycle in late 2026.

About the Chart of the Week

The FreightWaves Chart of the Week is a chart selection from SONAR that provides an interesting data point to describe the state of the freight markets. A chart is chosen from thousands of potential charts on SONAR to help participants visualize the freight market in real time. Each week a Market Expert will post a chart, along with commentary, live on the front page. After that, the Chart of the Week will be archived on FreightWaves.com for future reference.

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