Freight for Thought: UPS announces heavy layoffs in 2024

The following insights are provided by Sunset’s Strategic Account Management team.

Trends and discussions range from seasonal manufacturing and agriculture trends that affect available capacity to general insight into outside factors affecting freight volumes.

Below is a summary of the January 2024 industry insights:


  • UPS has announced heavy layoffs exceeding 12,000 workers this year, most of which are expected in the first half of 2024. UPS also announced they are exploring “strategic alternatives” for subsidiary Coyote Logistics. (
  • As we get closer to the Lunar New Year in Asia (February 10), ocean carriers on the Asia-US trade are rapidly executing general rate increases (GRIs) in a bid to take advantage of seasonal tightness in an already overheated market. Shippers are seeing proposed GRIs ranging from $600 to $1,000 per FEU meant to take effect in February. We expect rates will quickly decline when factories in Asia close for about two weeks during the annual celebration.
  • LTL rates are probable to rise +4% in 2024 after a mere 2.4% increase last year.  We don’t anticipate a change in the market until industrial production revives, expected to be late in 2024.
  • The escalation of war activity around the Red Sea/Suez Canal have forced vessels to reroute through the Cape of Good Hope, disrupting international supply chains.  This has caused average rates on shipments from Asia to the US to reach their highest point since November 2022 ($3411).
  • The Port of New Orleans (Port NOLA) has received a $226M federal grant to help fund the construction of a new mega-container ship terminal as the port seeks to keep pace with similar US Gulf Coast capacity upgrades.
  • Forward Air has completed its acquisition of Omni Logistics, significantly expanding their LTL network in the process.
  • Diesel prices have risen to $3.867/gallon this week, increasing $.029 from the week prior, and decreasing $.755 from a year ago.


  • The liquidation of assets of bankrupt LTL Carrier, Yellow, has completed.  Coming out on top of the bidding process is XPO with 28 purchased terminals for $870M.  The full list of terminal sales is below.  Owned terminals were liquidated in Phase 1, leased terminals were liquidated in Phase 2.


The transportation industry has faced many challenges in 2023, including:

  • Slowing Demand: In 2023, demand for truck capacity slowed due to retail overstocking, industry overcrowding, and lessened consumer demand.
  • Rising Expenses: Trucking companies faced rising expenses to manage such as insurance and maintenance.
  • Labor Disputes: Some of the biggest labor disputes were resolved in 2023 but were extremely impactful.
  • Oil Price Swings: Oil prices ranged from lows of $75 to highs of $95 per barrel.
  • Carriers exiting the market: Carriers exited the market, but not quickly enough to outpace the surge of new entrants from prior years.
  • Spot Rates: Spot rates decreased for most of 2023, but experienced a slight increase in Q4.
  • Inflation: The impact of inflation continues to be felt heavily in all areas of the industry.
  • Artificial Intelligence: An increase in the exploration of artificial intelligence (“AI”)/machine learning (”ML”) is being seen in the industry, causing great pushback among labor organizations.
  • Houthi Attacks: In late 2023, Houthi attacks have disrupted vital trade routes in the Red Sea, leading to re-routing of shipping traffic. 

The transportation industry has been highly competitive since the pandemic, with a fast-growing and highly skilled workforce. In 2023, more than 1,500 freight brokers closed, including many smaller carriers and brokerages. 


  • Fuel prices are volatile; however, rates have been consistently dropping for more than 5 months even amid a war in the Middle East.  Because of this, we expect fuel rates to remain flat or drop in 2024, overall.
  • Expect insurance premiums to increase again in 2024. This will impact individual drivers, for-hire fleets, and private fleets equally.
  • Due to production issues, labor shortages, and supply chain congestion, the price of new trailers has skyrocketed since 2020.  This number is expected to be up again in 2024. 
  • Worldwide vehicle labor, parts, and maintenance pricing is still on the rise.  The expectation is that more fleets will experience production issues as older trailers reach end of life service.  Carriers who are unable to replace with new trailers will be faced with inflated repair costs and downtime expenses.
  • Carbon Emissions monitoring and analysis will become standard in 2024.
  • Driver pay is expected to remain flat in 2024, with a slight increase toward Q4.  This could lead to some drivers exiting the industry entirely.
  • As RFQ/GRI season is among us, the expectation is that shippers will want to focus on tightening spend to secure lower rates before the market shifts. 
  • With the extreme cost pressures carriers are facing, some may no longer be able to move freight at previously contracted rates.  If this happens, we will see a large volume of freight brought to the spot market.
  • Though the rate of inflation is decreasing, the average consumer is still feeling the financial effects of sharp price hikes in products and services.  Consumer credit balances and overall debt are rising.  The CPI began the year down .3%, indicating low consumer confidence.
  • Layoffs will continue in the transportation industry as capacity tightens further due to lack of demand and low rates.

Sunset’s expectations for 2024 are that demand will remain moderate to low, expenses will continue to rise, fuel to remain flat, and for excess capacity to exit the market around Q3.  Freight rates will likely be unchanged until the latter half of the year.



Please expect delays in transit for shipments going through the affected areas listed below:

Farmers Almanac Prediction for Winter 2024:

  • Snow will arrive beginning in November in the Northeast and Midwest.
  • Storms, showers, and flurries will continue through the start of spring.
  • Colder-than-normal temperatures will be experienced in areas that typically get snow.
  • The Pacific Northwest will have a cooler, wet winter.
  • There are indications that an El Niño will be brewing in the latter half of 2023, lasting into the winter of 2024.
  • El Niño is an unusually high-water temperature off the Pacific Coast of South America. Forecasters estimate a greater than 55% chance that El Niño will remain above that threshold for strong through January-March 2024.

Industry data is pulled and summarized weekly from key proprietors and industry experts using multiple publications and sources. Sources include, but not limited to: FreightWaves, U.S. Energy Information Administration (EIA), DAT, Journal of Commerce (JOC), Reuters, PYMNTS, NRF, Bloomberg. The information is discussed with Sunset Directors and validated prior to publication of summary data in this posting.