As the calendar inches closer to May 14th-16th, the transportation industry gears up for an annual event that could potentially shake up capacity and rates: the Commercial Vehicle Safety Alliance’s (CVSA) International Roadcheck. But what exactly is Roadcheck week, and how might it influence the market dynamics this year? Let’s dive into the details and analyze the data to draw meaningful insights.

Understanding Roadcheck Week

CVSA’s International Roadcheck is more than just a routine inspection—it’s a high-visibility, high-volume initiative spanning three days across Canada, Mexico, and the United States. With a focus on driver and vehicle compliance, this event aims to ensure safety and regulatory adherence. This year, the spotlight shines on controlled substance and alcohol possession for drivers, while vehicle inspections hone in on tractor protection and anti-bleed back systems.

Last year’s Roadcheck saw a staggering 60,000 inspections, uncovering over 17,000 vehicle out-of-service violations and more than 5,000 driver out-of-service violations. These numbers underscore the significance of preparing for Roadcheck, as violations can lead to costly downtime and operational setbacks. The timing of these inspections in relation to market conditions can dictate whether carriers opt to participate or maintain regular operations during this 72-hour blitz.

Analyzing Market Trends

To anticipate Roadcheck’s potential impact on capacity and rates, let’s turn to the data:

Spot Load Availability and Rates (FTR): Over the past six weeks, spot load availability has dwindled, albeit with historical trends suggesting a surge in May as Memorial Day approaches. Meanwhile, spot rates have remained relatively flat, following a pattern of steady increase until peaking around mid-year.
Contract Load Volume and Spot Rates (SONAR): Last year’s data reveals a noteworthy pattern: van spot rates dipped just before Roadcheck week, only to soar afterward. This indicates a tightening of capacity during the inspection period, prompting increased demand for spot market services. However, this April saw a different narrative, with rising contract volumes and falling spot rates, suggesting sufficient capacity to meet demand.
Spread Between Spot and Contract Rates: The narrowing spread between spot and contract van rates over the past year signals heightened activity in the spot market. This trend makes spot loads more appealing, especially if spot rates rise relative to contractual rates.

Predicting Roadcheck’s Impact

Considering the evolving market dynamics—increased contract volumes, a narrowing spread between spot and contract rates, and historical patterns around Roadcheck week—it’s plausible to anticipate some rate volatility, particularly on a localized level. While national trends may not perfectly align with Roadcheck dates, the heightened demand for spot market services during the inspection period could lead to notable rate fluctuations, especially in specific lanes.

In conclusion, as carriers weigh their options and decide whether to participate in Roadcheck or maintain regular operations, the evolving market conditions suggest the potential for significant rate volatility. Whether these trends persist or intensify remains uncertain, but one thing is clear: International Roadcheck week may indeed leave its mark on capacity and rates this year.

Stay tuned as we navigate the complexities of Roadcheck week and its implications for the transportation industry. Prepare for potential shifts in capacity and rates, and stay informed to make strategic decisions in the ever-changing logistics landscape.