LTL rates surge in Q3   

Stephens Inc. reported that third quarter LTL rates increased 4.9% from Q3 2010 and 3.0% from Q2 of 2011. The year-over-year increase is the largest since Q3 2003. Stephens is predicting a 5-6% year-over-year increase in LTL rates in the second half of 2011, but they don't see full recovery of pre-recession LTL pricing even through 2012. In 2010 LTL rates dropped 3.7% (117.7 to 113.3) which followed a larger 4.6% drop from 2008 to 2009. In 2009, LTL carriers were pricing aggressively to win share from weaker competitors. The challenges facing LTL carriers are apparent with pricing in 2011 roughly equivalent to 2004 pricing, despite increases in most trucking related costs. Some of the capacity issues that will impact the TL segment, like CSA 2010 and hours of service, are not as relevant in the LTL segment.

Graph reproduced with permission from Stephens Inc. For more information contact: Jack Waldo at jwaldo@stephens.com or Tyler Bozynski at tyler.bozynski@stephens.com