Spot market volumes bounce back to pre-Thanksgiving volume, and then some

Yeah, I suppose that's fair. I don't currently run any contract freight, so I never really know how well contract rates on these rate averages hold up against the actual contract rates.

 

DAT and Truckstop get there "lanes" for rates from guess who? Factoring companies.
I know this is going to sound harsh, but don't let that distract from the point. Factoring companies are for trucking companies that are limited on funds. That information comes from the bottom.

There are many many shippers that pay $3-$4 per mile. Those "lanes" at $2.25 per mile from DAT and Truckstop is broker's cutting down the cash strap trucking company that needs a factoring company to keep up with cash flow that pay there driver's 45-50 cents per mile.

 

Well, and I assumed that contract also means spot pay to the broker as well. Sort of all mixed in together. I guarantee they got their hands in a lot of pies that people aren’t aware of their data being mined. All in the fine print I’m sure. It’s scary almost how much data freight waves is able to buy. Do you guys subscribe to sonar?

 

We don't. We kinda played with it a little during the "try for free during the hurricane" bit, but honestly not hard enough to give it a fair evaluation. We were pretty busy. I'd like to circle back to it, and maybe consider it more, but that'll be a decision made by the boss, one way or the other.

 

I agree. I use the DAT average to negotiate with brokers all the time. I find it very helpful when the market is strong and not helpful at all when it is weak. Just last Friday I needed a short hop home. I called on a 250 mile run and she wanted to pay $600. I said, truthfully, DAT 15 day average for this lane is $947, I'll cover it for $900. She didn't even argue, just said OK and sent me a rate con.

 

That's nonsense. Take a look at some of these screenshots below. Plenty of $3+ a mile 15 day average rates on decent miles hauls. Some of them to decent areas or areas that can be deadheaded right back to the start point empty to do it again. I could spend all night posting screenshots like that from all over the country. There's a bunch of them and they're not rare. There's also some in the $2 range and worse. If DAT is working in tandem with brokers to suppress $3+ lane averages then they need to work harder because they're massively failing. And the cash poor carriers that factor need to quit skewing the averages up like they are.

 

The screenshots...

 

I think we'll see those rates starting to trend down starting next week. I'm seeing shippers forcing rates down now in California, and a quick search on DAT for available trucks yesterday (Tuesday) in Sacramento showed over 700 trucks looking for loads. That's the highest I've seen in since last year. My northbound loads the last 2 weeks are about 20% less than the previous weeks. My contract southbound rates have remained the same.

 

DAT receives data from our TMS, I'm assuming they do with other 3PLs as well. When I look at a trendline on a lane when I use my DAT login, I can actually see little pips that indicate what we paid versus the trend on the lane (see below).



I tend to find that DAT is much more accurate for major market to major market 1 pick 1 drop lanes. It gets worse when you deviate from that, and also is tends to lowball short mile rates. It also will lag behind in a shifting market (if you are relying on DAT rates out of Florida in May during a normal produce season, you are going to get burned when the market flips). It's not a perfect system but it is definitely useful.

We don't currently subscribe to SONAR, but I really like it and would love if we started using it. It's so much easier to send data to a customer supporting challenges in the market place when sending trendlines around outbound tender volume and tender rejection, instead of sending them a RPM trendline that might not even match up with what is being charged on the lane.

 

I think any down trend in rates will be short lived, I think there will be a surge in Load to Truck ratio for Christmas. It will probably cool off a bit once the new year rolls around though.