LTL pricing is improving despite a softer market, ArcBest President and CEO Seth Runser said on a Q1 earnings call, noting that even though a broader recovery remains difficult to predict, conditions such as manufacturing activity are improving.
The average price increase for contract renewals and deferred pricing agreements in Q1 was 6.3% for ArcBest’s asset-based segment, featuring LTL carrier ABF Freight, the company reported Tuesday. That’s the strongest result since Q3 2022, Runser said.
“That really reinforces the confidence and durability of those core customer relationships that we had,” Runser said, highlighting how those connections could help position ArcBest for growth when the freight cycle improves.
The asset-based segment’s operating ratio faltered to 97.3%, from 95.9% a year ago, and operating income fell by nearly 34% to $17.5 million, the company reported.
ArcBest asset-based segment metrics make several notable gains
But recent freight dynamics have been encouraging for the company. The business projects an operating ratio to perform better than the normal seasonal Q1 to Q2 improvement of 3.5 percentage points, forecasting a sequential strengthening of 4 to 5 percentage points.
“This outlook reflects continued momentum in our commercial pipeline discipline execution on pricing initiatives and the impact of recent fuel price movements,” CFO Matt Beasley said on the Q1 earnings call.
