Chart of the Week: Outbound Tender Reject Index for dry van, refrigerated, and flatbed – USA SONAR: VOTRI.USA, ROTRI.USA, FOTRI.USA

Flatbed capacity continues to be challenging to source over a year after the truckload market collapsed for dry van and refrigerated freight. Tender rejection rates, the percentage of loads carriers are unable to cover for their customers, have moved below 3% for van (VOTRI) and refrigerated or reefer (ROTRI) loads while flatbed rejection rates jumped back over 17% this past week. Why is flatbed capacity not following in trend with the other two trailer types?

Tis the season

Flatbed freight is extremely seasonal and tends to have a strong spring rebound compared to winter. Many drivers swap their flat trailers out for dry van or reefer trailers during the colder and wetter months. When construction activity resumes in the spring, flatbed capacity can sometimes be caught off guard in the transition. 


Flatbed demand has a strong connection to manufacturing as well. Automotive production stalled during 2020-21 amid supply chain bottlenecks. Semiconductors were not the only parts the automakers could not get ahold of consistently. This led to backlogs with all the OEMs and once consumer goods demand waned, it cleared the way for other items to move.

The new orders component of the Institute for Supply Management (ISM) indices illustrates how new orders — a leading indicator for freight — were coming in at all-time highs from July 2020 till Q3 2021. Subsequently backlogs of orders expanded at nearly an identical pace throughout 2021.


Flatbed rejection rates were well below van and refrigerated for most of the second half of 2020 and first half of 2021, a very unusual situation from a historical context. Flatbed capacity tends to be as erratic as its demand, making it harder to secure in general. Van spot rates rarely exceed flatbed for this reason. Flatbed freight also tends to be more labor-intensive and specialized. 

With rates for general dry van freight (white) being in line with flatbed (green) during the heart of the pandemic in 2021, it possibly helped limit capacity growth for this equipment type. This would be a lot like the seasonal effect described above but on a larger scale. 

Flatbed capacity does appear to be moving in the same direction as the rest of the truckload market over the long run, even if you include the recent tender rejection spike. Demand volatility may also be helping support spot rates as carriers struggle with the inconsistent flow of freight. 

The economy is still slowing. Real GDP growth only hit 1.6% this past quarter, with goods-adjusted GDP only reaching 0.62%. Housing starts and building permits are contracting from highs hit in early 2022.

While demand suffers from the same long-term risks as the other two equipment types, the limitation of capacity growth over the past few years may be the differentiator that keeps this mode of transportation out of the deepest depths of the freight recession.

About the Chart of the Week

The FreightWaves Chart of the Week is a chart selection from SONAR that provides an interesting data point to describe the state of the freight markets. A chart is chosen from thousands of potential charts on SONAR to help participants visualize the freight market in real time. Each week a Market Expert will post a chart, along with commentary, live on the front page. After that, the Chart of the Week will be archived on for future reference.

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