360 Account
.svg)
.png)
Structural Forces Reshaping
the Freight Market
the Freight Market
Structural changes in trucking regulation enforcement, driver availability and operating costs are reshaping the freight market and increasing the investment required to maintain qualified, safe and reliable capacity. During the past several years, reduced enforcement allowed an influx of drivers, many of whom did not meet safety standards, contributing to excess capacity and prolonged rate pressure.
As ongoing enforcement removes non-compliant drivers from the road, capacity continues to tighten. The increased competition for qualified drivers combined with ongoing inflation across insurance, equipment and maintenance costs is driving a structural increase in carrier cost bases.
In this paper, we examine how these forces are converging to create a fundamentally different operating environment for carriers and shippers alike. For shippers, the implication is clear: transportation budgets built around the structurally distorted pricing conditions of the past several years benefited shippers but are unsustainable for carriers as the cost of maintaining qualified, safe and reliable capacity continues to rise.
In 2025 the average operational costs of trucking reached a record $2.336 per mile (excluding fuel), an increase of 47% from 2019, according to data from the American Transportation Research Institute (ATRI) Analysis of the Operational Costs of Trucking: 2026 Update. P&L expenses have increased in 2026 and are forecasted to go higher again in 2027.
These structural forces are reshaping the U.S. freight market. The convergence of these pressures may cause the current cycle to differ from recent freight cycles, particularly if capacity contracts while demand remains relatively stable or increases. These pressures may affect transportation costs, budgeting and sourcing decisions even if demand remains relatively flat.
The analysis is organized around three connected pressures: regulatory enforcement aimed at improving safety that is reducing the available carrier base, labor constraints that increase the cost of qualified drivers and inflationary operating costs that require higher rates. Together, these pressures suggest that freight market dynamics over the next several years may differ from those experienced during the recent period of excess capacity and rate deflation.
Regulatory Changes and Enforcement
Following several high-profile fatal crashes involving drivers operating with non-domiciled CDLs, including reports that the drivers were unable to communicate effectively in English, the U.S. Department of Transportation’s (USDOT) Federal Motor Carrier Safety Administration (FMSCA) has increased enforcement of existing regulations and is considering additional rulemaking to improve highway safety and reduce fatal truck crashes.
2025 saw initial impacts from regulatory enforcement changes in the industry with immigration-related policies directly affecting the commercial driver workforce. The impact of these changes accelerated in 2026.
Non-Domiciled CDLs: FMCSA guidance is tightening eligibility for non-domiciled commercial driver’s license (CDL) holders and pushing states to audit or revoke credentials that do not meet federal expectations.
English Language Proficiency (ELP): Stricter ELP enforcement is having a more immediate impact on capacity as a driver can be placed out-of-service for failing to pass a proficiency evaluation during a roadside inspection.
Cabotage: The tightened enforcement of cabotage regulations has reduced the frequency of foreign-registered trucks picking up and delivering domestic loads.
Electronic Logging Devices (ELD): FMCSA is in the process of rolling out major ELD rule revisions following the release of the USDOT regulatory agenda. Key updates include proposed rulemakings to address compliance loopholes, an overhaul of the ELD vetting process to block non-compliant devices and a new revoked devices list.
Since January 2025, FMCSA has removed 79 devices that failed to meet Federal standards. Motor carriers have 90 days to replace the revoked ELDs with a compliant ELD – drivers using a revoked device after that date could be placed out-of-service by safety officials.
Additional regulatory and legislative changes, outlined below, could place further pressure on the pool of compliant carriers available to move freight in the U.S.
Dalilah’s Law: A bill known as Dalilah’s Law advanced by the U.S. House Transportation and Infrastructure Committee aims to permanently write into federal law the tighter CDL standards that are already being enforced by FMCSA – adding English-only CDL testing, cracking down on fraudulent CDL training schools and banning foreign dispatch and broker activity.
If enacted, these requirements could increase compliance obligations across segments of the transportation industry and contribute to greater competition for vetted, compliant carrier capacity.
Motus: This new USDOT registration system works to strengthen oversight, reduce fraud, improve data accuracy and simplify registration management for the trucking industry. Carriers now have a single location to apply for a USDOT number, apply for motor carrier operating authority (MC authority), update company information, complete registration updates and maintain compliance with FMCSA registration requirements.
Because Motus introduces stronger identity verification and registration controls, it should make it more difficult for bad actors to obtain operating authority. This system introduces additional verification and identity-validation measures designed to improve registration integrity. As a result, some applicants may experience increased documentation and verification requirements before receiving operating authority, which may create a higher barrier to entry for new applicants.
Montgomery v. Caribe: In May 2026, the U.S. Supreme Court held that the Federal Aviation Administration Authorization Act does not preempt a state-law claim alleging that a freight broker negligently selected a motor carrier. The decision permits those claims to proceed under applicable state negligence law, but it does not impose automatic lability or establish a uniform national standard for carrier selection.
Because standards of reasonable care will continue to be developed through state-law negligence principles and case-specific facts, the decision is likely to increase scrutiny of broker carrier-selection practices. Brokers may respond by documenting and, where appropriate, strengthening carrier-vetting processes.
More selective carrier vetting processes may impact capacity in at least two ways – by adding a barrier to entry for new carriers and by removing existing capacity from the market as smaller carrier fleets are affected by more stringent requirements (90%+ of authorized carriers operate without an FMCSA rating, according to Chris Burroughs, President and CEO for the Transportation Intermediaries Association). The absence of an FMCSA safety rating does not, by itself, suggest that a carrier is unsafe. However, limited federal rating information may cause brokers to rely on additional safety, operating-history and identity-verification information when selecting carriers.
Qualified Driver Pool
Regulatory enforcement initiatives focused on safety, workforce demographics and qualification requirements are contributing to pressure on the pool of available drivers and increasing the cost of attracting and retaining qualified drivers.
According to the ACT For-Hire Trucking Index, which measures the degree and directional changes in operational statistics based on a survey of carriers, the industry continued to see a tightening of capacity in June 2026 as shown by the Driver Availability Index.
ACT For-Hire Trucking Index: Driver Availability, January 2019 – June 2026
Source: ACT Research July 2026 For-Hire Trucking Index
Additional factors impacting the driver supply include the closure of fraudulent CDL schools and the Drug and Alcohol Clearinghouse.
Driver Pay: As capacity tightens, driver pay is increasing. According to The National Transportation Institute (NTI), driver compensation has remained relatively stable over the last several years, but fleets are now increasing starting pay, mileage rates, bonuses and other incentives in order to recruit and retain drivers. The latest driver pay index shows that professional truck drivers are now earning approximately 57% more than they did in January 2020.
As of June 2026, the driver pay index was at an all-time high at 170.04. The index measures actual payroll and reflects changes in pay rates, miles driven, freight demand, bonuses, accessorial pay and other compensation paid to truck drivers.
Truck Driver Pay Index
Source: Superior Trucking Payroll Service, Truck Driver Pay Index Compensation Trends 2020-2026 STPS
Noncompliant CDL Schools: The U.S. Department of Transportation and FMCSA have removed more than 7,000 noncompliant CDL training schools across the nation following enforcement efforts related to training and certification requirements. This was due to investigations that programs were using fake addresses, lacked certified or properly licensed instructors, failed to provide mandatory behind-the-wheel training time and skipped testing for hazardous materials handling, among other violations.
While this may be a necessary step for removing unsafe training programs, the reduced number of compliant CDL training programs could be another barrier to entry for new drivers.
Drug and Alcohol Clearinghouse: The FMCSA’s Drug and Alcohol Clearinghouse restricts CDL and commercial learner’s permit (CLP) holders with unresolved drug and alcohol violations from operating commercial vehicles. As of January 2, 2026, more than 200,000 CDL and CLP holders were reported in prohibited status, most of which have not initiated the return-to-duty process required to re-enter the industry.
Source: FreightWaves
Aging Driver Population: According to data from NTI, the trucking industry has a workforce that is older than the general workforce, with 69% of truck drivers being either Baby Boomers or Gen X.
Thirty percent of the driver population will reach retirement age within the next decade, and as that population ages out of the industry, there may be a lack of younger drivers to replace them. In 2025, less than 35% of the driver workforce was under the age of 45.
Driver Population by Age Group
Source: The National Transportation Institute Surveys of Motor Carriers and Private Fleets
Inflationary Impacts
Inflationary pressure within the trucking industry is another factor affecting budgeting and sourcing decisions. The ATRI Analysis of the Operational Costs of Trucking report shows that motor carrier costs per mile (CPM) have increased at a 6.6% CAGR since 2019 and the cost to execute loads is outpacing rates from shippers.
Truckload Market Update (excluding fuel)
Source: ATRI & J.B. Hunt Analysis
Truckload Market Update YoY Change
Source: ATRI, CASS and J.B. Hunt Analysis
With operating costs increasing faster than many transportation rates over the last several years, more than 20 trucking-related companies have filed Chapter 7 liquidation or Chapter 11 restructuring cases as of May 2026, according to FreightWaves. These filings suggest that prolonged cost pressure is already removing some capacity from the market.
These inflationary pressures and depressed rates over a four-year period have resulted in some carriers being unable to reinvest in their business. When combined with continued cost increases for insurance, equipment and maintenance, there may be a further reduction of capacity and higher costs passed on to shippers.
Insurance: Changes in insurance rates within the trucking industry are determined based on a variety of factors, including severity and frequency of crashes, macroeconomic conditions, litigation trends, social inflation and other fleet-specific factors.
According to the ATRI report, Trucking's Rising Insurance Costs: Issues and Opportunities, May 2026, the cost of liability and cargo insurance premiums rose by 3.9% in 2025. This follows a 37.8% increase from the decade prior (2015-2024). From 2017 through 2025, the average annual inflation rate was 3.9%, however the average annual premium cost in the commercial auto segment rose 8.3%. During that same period, heavy-duty truck-involved injury and fatal crashes per 100 million miles decreased by 8.4%.
A significant factor affecting insurance costs is the growth of nuclear verdicts, generally defined as jury verdicts exceeding $10 million. According to data from Marsh & McLennan Agency LLC, average verdict sizes have increased by more than 1,000% over the past eight years. From 2019 through 2025 the total cost of risk, which represents insurance premium increases and deductibles, rose by more than 250%.
Commercial Auto Average Annual Rate Changes (2011-2024)
Source: Marsh/McGriff, 2026. Reproduced with permission.
Equipment: EPA compliance standards are resulting in increased equipment costs as fleets work to meet compliance expectations. The NOx rule requires model year 2027 and later diesel engines to cut nitrogen oxide emissions by roughly 80-90% compared to previous limits.
There are proposed revisions to the rule that incorporate key recommendations from the American Trucking Associations (ATA). The estimated truck cost impact from the original rule was $22,000 to $26,000. If approved, the amended rule would lower that estimate to $6,000 to $16,000. Even at the lower range, the added cost of new equipment required to meet EPA standards will affect carriers’ future operating costs.
Maintenance: From 2024 to 2025, repair and maintenance costs, including parts, labor and roadside service, rose by 8.6%, according to data from ATRI. Additionally, the industry average tire costs per mile (including parts and labor) increased 6.4% in 2025.
Repair and maintenance costs range from $0.156 per mile to $0.362 per mile, with specialized fleets seeing higher costs compared to truckload fleets of the same size.
Conclusion
Over the last four years, many shippers have benefited from an oversupplied freight market and historically favorable transportation pricing. However, regulatory enforcement initiatives, driver-availability constraints and rising carrier operating costs may influence the balance of supply and demand and transportation pricing negotiations and spending decisions as organizations plan for 2027 and beyond.
Although the timing and magnitude of these developments remain uncertain, shippers should not assume the deflationary conditions experienced in recent years will necessarily continue. Scenario-based transportation planning may help organizations evaluate the tradeoffs between cost, service and secured capacity. Optimizing capacity through a mix of multimodal solutions and determining the level of service requirements needed can deliver flexibility. By strengthening the driver experience, and working with safe, reliable carriers, shippers can help supply chains stay resilient.
Disclaimer: This material is provided for informational purposes only, is based on publicly available sources as of the publication date, and does not constitute legal, regulatory, financial or transportation-planning advice. References to regulatory or legislative developments reflect their status as of the publication date and may change. Future market conditions are uncertain and no forecasts, pricing, capacity levels or outcomes are guaranteed.