This week:
- At Inland ‘25 Distribution Conference, US trucking industry experts predict weak Q4, rebound in ‘26
- US LTL carriers’ famously strong discipline on pricing starting to crack amid prolonged low demand
- Trump administration announces new Section 232 tariffs on furniture, upholstered wood, and more
- Port of Los Angeles announces plans to construct new 200-acre terminal in anticipation of growth
Trucking Industry Experts Forecast Weak Q4, Strong Rebound in 2026
A slowdown in the US economy is expected to weaken the trucking industry for the rest of the year, according to speakers at last week’s Inland ‘25 Distribution Conference. However, many experts say this sets the stage for a strong rebound in 2026.
The event was held in Chicago and hosted by the Journal of Commerce (JoC). According to reporting by Michael Angell, a senior editor for the JoC, experts told conference attendees that inflation, tariffs, and lower consumer demand will place considerable pressure on the freight industry in Q4.
The speakers were more optimistic about 2026, when inventory restocking and potential business investments could give the trucking industry a boost.
S&P Global economist Paul Bingham said that after three uneven quarters, the US GDP is forecasted to be slightly negative in Q4. Bingham anticipates another surge of inflation as businesses, having depleted their pre-tariff stockpiles, now face higher costs on imported goods.
“We’re forecasting actually that inflation is increasing right now despite what the Federal Reserve believes,” Bingham said, explaining that this will likely cause companies to pause new capital investments.
Despite a forecasted GDP growth of just 1.9% for 2025, Bingham projected growth to hit 2.6% next year, which is similar to 2024 levels. He says that if the Trump administration can secure new trade deals and stabilize its tariff policies, the current high import duties will go down in history as a one-time price shock rather than the source of persistent inflation.
“If we have stability, business can plan,” Bingham said.
Keith Prather of Armada Corporate Intelligence said that with inventory-to-sales ratios at historic lows for most businesses, there is significant pent-up demand for restocking, which will ultimately drive demand in 2026.
LTL Pricing Discipline Shows Signs of Strain Amid Continued Drop in Demand
In other news from the JoC Inland ‘25 Distribution Conference, speakers also observed that the pricing discipline the US less-than-truckload (LTL) sector is known for is showing signs of strain. Although carriers have managed to increase rates over the last decade, prolonged low freight demand has begun to impact their profits.
While some analysts see carriers offering deep discounts to protect market share, others maintain that LTL’s pricing discipline remains firm,
“The cracks in the wall are there,” Mike Regan, co-founder of TranzAct Technologies, said at the conference on Tuesday. “We are seeing LTL carriers doing what I call ‘defending their turf’ in a sea of uncertainty.”
Regan said he sees carriers lowering rates in specific lanes where they need to build shipment density to help protect their margins. He cited one instance where a carrier seeking a 5% rate increase ultimately agreed to a 12% rate cut to retain the business.
“We’re seeing carrier pricing behavior that’s irrational,” Regan said. He predicts more of these types of deals as FedEx prepares to spin off its FedEx Freight division next June. However, other speakers contended that the LTL sector is maintaining its resolve on pricing.
“The pricing discipline is actually very solid,” said Mich Fabriga, vice president of LTL pricing at AFS Logistics.
William B. Cassidy, the JoC’s senior editor for trucking coverage, said that official data seems to support this view. The Producer Price Index (PPI) for long-distance LTL freight — a measure of the final prices paid by shippers maintained by the US Bureau of Labor Statistics — reached a record high of 269 in August. That figure is 10.5% higher year-over-year and 4.3% higher than in May.
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US Tariffs on Furniture and Wood Imports Set to Go Into Effect October 14
US President Donald Trump signed an executive order last week that imposes a new round of tariffs on imported wood, kitchen cabinets, and upholstered furniture beginning October 14. The order levies duties
of up to 25% on a range of wood-related products, with significant increases scheduled for 2026.
The new tariffs are the result of a Section 232 investigation by the Department of Commerce, which concluded that the current volume of wood product imports and related foreign trade practices pose a threat to US national security. The administration previously used a similar justification under Section 232 to impose tariffs on steel, aluminum, and automobiles.
Imports of softwood timber and lumber will be subject to a 10% tariff. A 25% duty will be applied to finished goods, including upholstered wooden furniture such as couches and chairs, as well as kitchen cabinets, vanities, and their component parts.
On January 1, 2026, the tariff on upholstered furniture will increase to 30%, while the duty on kitchen cabinets, vanities, and associated parts will double to 50%.
The new tariffs will not apply to items already covered by the administration’s 25% tariff on automobiles and auto parts.
The order includes several key exceptions based on existing trade agreements. Wood and furniture products from the United Kingdom will face a 10% tariff, while those from Japan and the European Union will be subject to a 15% levy.
Port of Los Angeles Plans Major New Terminal in Anticipation of Cargo Growth
The Port of Los Angeles is preparing for long-term cargo growth with plans to construct a new 200-acre, two-berth container terminal.
The proposed Pier 500 project is in response to forecasts that the largest port complex in the US, which includes the neighboring Port of Long Beach, will reach its combined capacity of 40 million TEUs by 2040.
The new terminal is expected to take approximately ten years to complete once construction begins. Gene Seroka, executive director of the Port of Los Angeles, told the JoC that the addition is designed to handle volume increases well beyond the current forecasts.
“Infrastructure like this always has a 20- to 30-year horizon,” Seroka said. He also announced last week that the port is seeking proposals for the pre-development of Pier 500, which will be located just south of the port’s massive Pier 400 terminal.
The LA-LB port complex handled a combined 19.9 million TEUs in 2024, a nearly 20% increase from the previous year.
