Passport Research: Is freight more concentrated?

Yes, freight volumes are becoming more
concentrated – the largest 25 markets are
taking share from the bottom 50. But so far
we’ve seen only a modest shift in volume
balance which we believe is unlikely to alter
prevailing trends in spot rates (low) and
capacity (abundant).

In last week’s Passport Research webinar, we
were asked if we noticed the concentration of
volumes in fewer markets and our view on
whether that trend would continue. At the
time we hadn’t really looked into it, but
immediately we recognized that depending
on the degree of concentration, it could have
important implications for how asset-based
carriers allocate capacity and how brokerages
price freight, both between healthy markets
and into and out of contracting markets.

In this piece, we break down the
concentration thesis and quantify it by tiers of
markets, looking at both the largest markets
and what might be considered the
second-tier of regional markets.

Then, in the last section of the report, we identify some emerging opportunities, defined as markets with lower than typical volumes and market shares that we believe are posed to snap back in the near future. Those markets include Los Angeles, San Francisco, Chicago, Joliet and Detroit.