Overcapacity has dropped from an excess of 30% in the market to about a 10% elevated level, J.B. Hunt Transport Services’ President and CEO Shelley Simpson said Tuesday.
The trucking market is still in a freight recession, but each day is a step toward getting out of it, Simpson said at Baird's Global Industrial Conference in Chicago.
“We're not the best at predicting when that's going to happen,” she said of a potential turn in the market. “It's gone on much longer than we anticipated.”
The freight recession is the longest and deepest many executives have seen in their entire careers. But signs are pointing to improvement in the trucking market, Simpson said, noting growth in J.B. Hunt’s eastern intermodal network and resilient sales.
The rest of the excess capacity could normalize by Q3 2025, she suggested, stressing that was an estimated projection.
Carrier exits continued to outweigh additions and retention in the market in Q3, per Federal Motor Carrier Safety Administration data, with the balance apparently moving toward stabilization.
J.B. Hunt’s Integrated Capacity Solutions segment reduced its operating loss in Q3. The carrier posted an overall operating income of $224.1 million in the quarter, down 7% year over year.
To return ICS to profitability, the carrier needs to scale itself out of lost revenue by meeting customers’ solutions, COO Nick Hobbs said at the conference.
“Particularly on the sales side, we need to sell and outgrow that fixed cost and really leverage our scale, but leverage it with the right customers and the right segments of business,” Hobbs said, adding that modes such as flatbed and/or tanker may provide more long-term stability.
