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September 1, 2023

What is the load-to-truck ratio?

DATA SPOTLIGHT

The load-to-truck ratio is a common statistic used across the trucking industry. It’s a fundamental piece of data analysis that determines shipping and freight trends, as well as the freight rates payable to truck drivers. But it is also one of the most commonly misunderstood data points, so it’s worth learning what exactly the load-to truck ratio is, how it’s calculated and why it’s so important to both truck drivers and the trucking industry as a whole.

First, it’s important to know that there’s no single load-to-truck ratio in the U.S. The data is not calculated on a national level and there are different load boards across the country that process the data for different spot markets. However, it’s often the case that the largest of these load boards are used as indicators for the state of the freight balance across the country.

Initially, these load boards were literally paper data sheets posted at truck stops across the country. Shippers and brokers could calculate their shipping rates and post them on these boards and truck drivers could use this information to plot their routes. These load boards were eventually digitized and accessed via phone lines, before making the move online to provide real-time freight matching information.

How to calculate the load-to-truck ratio?

The important thing to know is that the load-to-truck ratio is not as complicated as it seems. The load-to-truck ratio is a basic math problem. It’s a simple equation, but one that can provide a large amount of valuable data. To work out the load-to-truck ratio, you have to divide the number of load posts by the number of truck posts. When there are a lot of load posts (or very few truck posts) then the ratio goes up. If there are fewer loads and lots of trucks available, then the number comes down.

Load-to truck ratio is tracked across a range of different vehicle types. In general, the load-to-truck ratio is highest for flatbeds . This is followed by reefers, with vans usually having the lowest ratio). This happens because it is not as easy for brokers to source the correct flatbed equipment, and also because there are significantly more vans available than both flatbeds and reefers.

What does a high load-to-truck ratio mean?

A high load-to-truck ratio means there are lots of loads that need to be collected. Generally speaking, the higher the ratio, the more truck drivers are in demand and the more leverage they have for higher rates. This follows the basic rules of supply and demand economics, with the ratio being a useful signpost for truck drivers when freight rates might be higher in certain spot markets.

Do high load-to-truck ratios always mean better rates?

A high ratio is a strong indicator but not a guarantee that truck drivers will get better rates. This is because it’s also necessary to consider the actual number of loads and trucks posted in any market. In certain markets where there is a much higher number of trucks and loads, then this will impact the rates in a more significant way than in smaller markets.

When looking at the load-to-truck ratios, it’s also important to consider the wider trends as well as the real-time data. A broader understanding of what is happening across the industry makes it easier for truck drivers to plan routes more efficiently. This means that drivers can link together multiple better rate loads for trucks rather than risking one high-paying load followed by several lower rate trips.

Why is the load-to-truck ratio important?

The load-to-truck ratio is important because it basically describes the balance between the availability of freight and the truckload capacity in any spot market. A spot market is one where freight deals are quoted for and contracted on the spot. Therefore, the balance between the load and the freight availability is constantly changing and can be used to track emerging trends in any spot market.

Using the load-to-truck ratio, it is possible to monitor trends within the industry and gain a better understanding of how a spot market is developing. Knowing that when the load-to-truck ratio increases, van freight rates usually go up at the same time. However, the load-to-truck ratio has proved to be even more useful than that over the years, as the ratio usually follows the same pattern as national van rates.

Find rate trends with load-to-truck ratio

The load-to-truck ratio is a useful indicator of freight rates in the U.S. Not only does it provide a picture of what is happening in real time at various spot markets, but it also acts as an indicator of future rate changes. This can help truck drivers to maximize the potential of both outbound and return trips, improve truckload capacity, and plan more profitable routes. In addition, when the ratio is high, this gives truck drivers more leverage to achieve higher rates as it generally indicates that shippers need to get freight moving.

Find your next load with load-to-truck ratio

While the load-to-truck ratio is an important metric for working out where truck drivers can find their next load, it’s not the only data point that is useful. It’s just one part of a web of metrics that builds a bigger picture of the market as a whole. Truck drivers and trucking companies also need to keep a close eye on fuel costs, labor trends and seasonal changes in the supply chain in order to have the most up to date information about the freight market.

Where can you find the latest load-to-truck ratio?

https://www.loadtotruck.app/

How often does the load-to-truck ratio change in each city?

Thanks to the transition from paper lists to phone services to online digitized data streams, the load-to-truck ratio is now constantly updated and gives live information about the freight balance in cities all around the country. That means it is possible to monitor load boards in real time as the ratio changes and use this information to inform decisions about rates and route strategy.

For more information on how FleetOps can help your businesses access unique freight solutions, contact us today and explore the FleetOps blog to discover more industry insights.

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