Industry outlook for 2026

Top trucking executives are entering the New Year hopeful that 2026 will finally bring a sustained lift in freight demand, higher spot and contract rates, and a return to profitability across both truckload and less-than-truckload (LTL) operations.

Until such a recovery materializes, most carriers say they are focused on trimming variable costs and tightening operations where they have control.

Old Dominion highlights financial discipline

Old Dominion Freight Line (ODFL) executives stressed discipline and execution of a long-term strategy as they navigate a tough macroeconomic backdrop. President and CEO Kevin M. Freeman said the company is concentrating on factors it can manage while waiting for market conditions to improve.

In the third quarter ODFL reported a 74.3 operating ratio despite lower tonnage, and the carrier insists it is positioning itself to capture profitable growth when the industry inflection arrives.

Network capacity and reserve service centers

ODFL’s finance chief, Adam Satterfield, noted the company has added physical capacity during the freight downturn, opening six service centers since the end of 2022. Several more centers have been finished and are being held in reserve to be activated when demand justifies it.

Satterfield said the company prefers holding some facilities out of active operation rather than opening them prematurely, which would increase line-haul costs, dilute density and push up expenses.

• Six service centers opened since late 2022
• Multiple completed centers kept in reserve
• Preference for limiting operating service centers to control costs

Capacity metrics and historical comparison

ODFL reported roughly 35% excess capacity across its network, a marked increase from the 10–15% of spare capacity it carried during the tight market year of 2021. Executives say that relative excess today should leave them well positioned when an upcycle begins because the industry was capacity-constrained in 2022 and likely will be again when demand rebounds.

LTL and truckload dynamics

Executives at LTL carriers emphasize that overcapacity in the truckload sector is a central drag on pricing and profitability for both truckload and LTL firms. Geoff Muessig, chief marketing officer at Pitt Ohio, said the market currently has ample supply while demand remains subdued.

Unlike many other industries, interstate trucking finds it difficult to remove or add capacity quickly because of the heavy fixed investment in terminals and routing networks—especially for terminal-intensive LTL operations.

Headcount reductions and fleet adjustments

Many carriers responded to weak demand not by shrinking head count alone but by reducing available trucks. UPS eliminated about 48,000 positions last year and still reported net earnings in excess of $5 billion for the year, highlighting how companies have adjusted labor and operational footprints.

Manufacturers of heavy trucks also trimmed production forecasts. Volvo Group reduced its 2025 North American truck sales estimate to 265,000 units, down 10,000 from an earlier forecast, citing new tariffs and tepid demand as reasons for the downgrade.

Manufacturer and analyst comments on uncertainty

Volvo President and CEO Martin Lundstedt said customers are in a 'wait-and-see' posture amid the high level of market uncertainty, and that the company has built a strong platform for the future in North America despite short-term burdens.

Jason Seidl, a transportation analyst at TD Cowen, described a mixed landscape in which carriers see positives in tax policy and rate outlooks but worry about tariffs and consumer confidence, while the broader industrial economy remains challenged.

Prospects for market equilibrium

Industry leaders say a sustainable recovery hinges on the truckload sector moving toward market equilibrium so pricing can normalize. Peter Latta, chairman of A. Duie Pyle, said a demand-driven return to healthier pricing would benefit both truckload and LTL networks and is the preferred path to recovery.

Carriers and analysts alike will be watching early 2026 for any signs that demand is strengthening enough to reduce excess capacity and restore margins across the sector.