Tender rejection rates rose to nearly 14.3% in early February, according to a SONAR and Ryder System monthly report, suggesting a potentially encouraging shift in the market.
Compared to that inflection, showing an uptick in how frequently carriers are turning down jobs, the rate had previously hovered around 5% for parts of 2023 through 2025.
Recent readings in the metric surpassing 14% are “COVID-level type rejection rates,” Werner Enterprises CEO Derek Leathers said at Stifel’s 17th Annual Transportation & Logistics Conference in February.
Winter weather clearly had a major impact on freight flows, but levels were already high at 9.8% in late January, the report noted. That “supports the idea that a longer-term cycle of tightening capacity and rate inflation may be beginning to emerge,” according to the SONAR and Ryder System report for March.
Levels surpassing 14% for certain days and double-digit rejections are noteworthy, Leathers also said at Citi's Global Industrial Tech & Mobility Conference in February. He suggested some of that could be related to the early days after a storm, but “it still puts spot rates at sort of elevated outside-of-seasonality levels.”
Additionally, regional differences in the market are notable. Harsh winter weather in the Midwest since early December elevated the rejection rate above 18% in early February, the “highest level since March 2022,” according to the SONAR and Ryder System report.
Reefer rejection rates exceeded 20% as of Feb. 10 in the Midwest, too, per the report.
Other dynamics are also at play, such as capacity. If carrier supply is sufficient or oversaturated, then recovery from a storm is quicker and the rate impact is less significant, Leathers said.
Another cue on the market includes flower season for Valentine’s Day, which had notable reefer volumes but also sufficient capacity, DAT Freight & Analytics suggested.
Carriers such as Werner will also be looking at effects of a roadside inspection blitz, International Roadcheck, which can artificially crunch capacity as certain truckers park their trucks to avoid potential problems. That’s scheduled for May 12-14.
A potential market shift still remains, and some early indicators have given a mismatched picture of the market, Schneider National CEO Mark Rourke said last month also at the Citi conference.
“We've been through some head fakes,” Rourke said. “So I'm not here to tell you that happy days are totally here, but the environment feels — I think our customers are understanding. Last year, they went less brokers and more assets. I think that will be another strategy this year.”
