The past few years, the shipping industry has witnessed the bloom of the FTL dedicated truckload freight but a new player is going to disrupt the market in the form of LTL. Experts believe that it is already on the edge of undergoing an expansion. There are many factors that will ultimately contribute to the success of the LTL market such as fears brought about by trade wars, shortage of truck drivers, e-commerce and costs of fuel, capacity crunch and increases in the general rate among many others. While these factors will drive LTL to victory, these will also cause chaos in the years to come.
According to reports, the costs of the inbound LTL freight are already increasing even before the peak season for shipping has started. This prompted the overall market of the LTL to raise their rates in the following year. In line with this, shippers should be aware so they can budget properly and to get the most of the shipping costs they are allocating.
One of the main problems, if the outlook rate of the LTL freight is to increase, boils down to the foundation of business which is competition. In comparison to FT trucking, the market of the less than truckload is not in proportion. Twenty-five of the leading LTL providers are also managing around 90 percent of the total LTL freight. The rest which is only 10 per cent is already divided to smaller carriers in the regional and local market.
At the end of the day, acquiring a better deal is not as obvious compared to choosing a carrier under FT. An estimated 11.2 per cent has changed with the FT rates. On the other hand, a 7.5 per cent growth with regards to the LTL rates has been recorded.
While there are still many providers of FTL dedicated truckload freight, LTL will start to make its way into the spotlight because of its extra capacity to handle which the former cannot do so. The main advantage with LTL is that the system is able to hire drivers in the younger age range compared to FTL.