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NEWSLETTER BROUGHT TO YOU BY — EROAD

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In this week’s edition, the EPA is looking at new guidelines on diesel exhaust fluid (DEF) systems to avoid pesky shutdowns or derates when the truck runs out of DEF. Large truck OEMs continue to face headwinds from regulatory rollbacks, trade war uncertainty, and now fewer fleets buying new rigs. The California AB5 law is making its way east, with its signature ABC test making its way to New Jersey, not by way of state legislation but by possible regulatory rulemaking. And finally, a recent poll conducted by Truckstop and Bloomberg shows 85% of carriers and 83% of brokers expect volumes to rise or stay flat over the next six months.

As always, thanks for reading.

– Thomas Wasson

This week’s stories from the wide world of Trucking

TRUCKING REGULATION

EPA aims to keep diesel trucks on the road

New guidance expected to help drivers avoid downtime from DEF failures

OEM TRUCKING

Truck sales in the second quarter might have been the worst performing metric of all

Through several earnings calls, executives talk of an extremely weak market, with possibly a bit of optimism looking forward

LEGAL ISSUES

‘Impossible position’ cited by truck manufacturers in lawsuit against California

Companies squeezed by their signing of Clean Truck Partnership and federal steps to block Advanced Clean Truck rule

TRUCKING REGULATION

New Jersey truckers await–with dread–possible changes in state’s independent contractor law

Like AB5, proposed change from Labor Department would codify state’s version of the ABC test

TRUCKING

Small Fleets, Brokers Hold Steady Optimism Despite Freight Market Headwinds

Despite revenue challenges and tariff concerns, 85% of carriers and 83% of brokers expect volumes to rise or stay flat over the next six months.

SONAR spotlight: Initial reported van contract rates take a jump

(Source: SONAR)

Summary: Dry van contract rates continue to oscillate between overperforming and underperforming compared to the previous year. The van contract initial reporting of the average base rate per mile (VCRPM1) measures the seven-day moving average daily median rate per mile for loads over 250 miles. The SONAR ticker is on a 14-day lag, with the complementary ticker, the van contract final reported average base rate per mile (VCRPMF), moving on a 56-day lag.

VCRPM1 continued to fall during the last week of July, down six cents per mile from a July 1 value of $2.33 per mile to $2.27 per mile. Compare that to 2024, where initial reported contract rates posted a 3-cent-per-mile gain from $2.29 to $2.32. A challenge for carriers remains higher costs and lower rates. Compared to 2023, VCRPM1 is 10 cents per mile lower than $2.37 on July 29, 2023.

The final reported average base rate per mile, with its 56-day lag, showed more promise, with its most recent reading of June 17 showing a positive year-over-year comparison from $2.19 in 2024 to $2.23 per mile.

The current challenge remains the difference between the initial reported base rate per mile and the final base rate per mile. When looking at a year’s worth of data, it appears that shippers are still able to extract rate concessions from carriers, as the final rate per mile remains lower than the initial base rate.

While dry van outbound tender rejection rates remain in a more favorable position, it does not appear at this time that tender rejection rates are creating conditions where carriers can negotiate for more favorable contract rates, at least in a sustained and observable manner based on the SONAR dataset.