The Cass Freight Index by Cass Information Systems, in partnership with ACT Research, is one of the most reliable barometers for North American freight activity. It tracks monthly data for shipment volumes and expenditures across multiple transportation modes.

But the May 2025 report reveals trends of declining freight volume. The data paints a picture of an industry grappling with the aftermath of trade policy uncertainty and adjustments to inventory levels. So, what’s really behind the decline, and what does this mean for the trucking industry?

We examined all the facts behind the scenes to get to the answers.

May 2025 Cass Freight Index Freight Volume Trends

Shipment Volume Decline

The numbers in the May 2025 Cass Transportation Index Report are very telling.

In a month when domestic shipping volumes typically rise, May freight volumes contradicted seasonal patterns with a month-over-month (m/m) decline of 0.4%. The seasonally adjusted (SA) data indicate a 3.4% decline in the same period. The year-over-year (y/y) decline of 4.0% is a major source of concern.

The numbers highlight real-world challenges for small trucking operations.

The normal seasonal pattern for May usually sees freight volumes increase as retailers prepare for summer demand and manufacturers ramp up production. The data shows that the market is moving in the opposite direction.

This is partly due to destocking of pre-tariff inventory buildups and a shift from full truckload (FTL) to less-than-truckload (LTL).

Destocking Effects

A significant shift in inventory management strategies across industries is at the root of the decline. The ongoing trade disputes have had a variety of effects.

Pre-tariff consumer spending still supports freight demand. However, many businesses rushed to stockpile goods ahead of potential tariff implementations in late 2024 and early 2025. Because of this cautious inventory management and inventory build-up, companies must now work through the excess.

Pre-tariff inventory stocking has turned to destocking.

This reduces their current need for inbound freight across multiple sectors. This destocking trend is expected to persist through the summer months, creating ongoing challenges for fleet operators seeking consistent load volumes. But those excess stocks will eventually start to thin.

Freight Expenditures and Rate Dynamics

The Cass report presents a complex picture for the industry. An increase in spending, despite fewer shipments, reflects underlying rate pressures.

Expenditures Increase

The Cass Freight Index expenditures component for May 2025 indicated a rise of 1.4% m/m. This index includes changes in modal mix, intramodal mix, fuel, and accessorial charges. It’s more volatile than the Cass Truckload Linehaul Index.

The Cass Truckload Linehaul Index, which measures the ups and downs in truckload rates on a per-mile basis, fell 0.8% m/m in May, after a 0.5% decline in April. While load volumes remain challenging, the rates per mile or shipment are stabilizing.

Inferred Freight Rates

Cass Inferred Freight Rates, expenditures divided by shipments, rose 1.8% m/m in May, and 4.8% SA.

Freight rates are influenced by many factors, from supply and demand, seasonal trends, and regulations to fuel prices, interest rates, and even weather conditions. But in the current market, the main issue is an increase in expenditures despite fewer shipments.

The average cost of a shipment rose 5.0% y/y in May.

Modal Shifts and Market Implications

The inferred rate increase reflects both market conditions and changes in freight mix.

The mix is moving from LTL toward FTL, which is ordinarily a sign of an improving freight cycle. But in this case, it appears to have been influenced mostly by pre-tariff shipping. Shippers are consolidating loads to achieve better efficiency.

This modal shift creates distinct opportunities and challenges for different types of trucking operations.

Full truckload carriers with efficient operations that have made a savvy business investment in modern equipment may find improved pricing power as demand concentrates in the full load segment. However, operators in the LTL truckload market face reduced volumes.

Carriers adapt to these changes by adjusting their services and pricing. The shift also reflects inventory management changes. As companies move away from just-in-time models, they’re often willing to pay more for full truckload services.

This trend favors owner-operators and small, private fleets that can provide dedicated or semi-dedicated services to specific customers.

Economic and Policy Influences

The current freight market cannot be understood without considering the broader economic and policy environment shaping freight transportation demand.

Trade policies and tariff implementations have created significant uncertainty for businesses. Recent policy developments have particularly impacted freight volumes in import-dependent industries, which have had to navigate changing cost structures and supply chain risks.

The inventory buildups, followed by the current destocking phase, are a direct response to this policy uncertainty rather than underlying demand changes. And the broader economic implications extend beyond immediate freight demand.

As higher prices reduce goods’ affordability and consumers’ earnings, the current challenges facing the trucking industry may persist. Manufacturers and retailers in the trucking industry are also feeling the effects of economic uncertainty, with sharp declines in the North American Class 8 truck market.

Freight Market Future Outlook

The Cass Transportation Index Reports offer insights into the health of the trucking industry. But while the current Cass Shipments Index may cause alarm, it’s not all doom and gloom. Looking ahead, we see the freight market facing a mix of challenges and opportunities.

The equipment cycle is a big influence. As older equipment reaches retirement and new truck orders remain below replacement levels, the industry may be setting up for tighter capacity conditions. This means a greater demand from shippers than carriers, which typically offers trucking companies more pricing power.

In time, markets adapt to new conditions. As inventory build-up supplies thin, and destocking runs its course, the market will eventually adjust to a new normal after the trade disputes. And the freight data is likely to stabilize.

Conclusion

In the Cass Transportation Index data, we see a freight market in transition, with declining freight volumes. The key factors driving this are destocking from pre-tariff inventory buildups, modal shifts toward truckload services, and policy uncertainty.

These are likely to continue influencing the market in 2025, but small fleet operators may find new, profitable opportunities as market conditions continue to evolve.

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