AI Data Center Construction Drives Heavy Haul Freight Volatility

Heavy haul and open equipment freight is experiencing extreme volatility driven by concentrated demand from AI data center construction. This segment is now the most volatile freight mode, outpacing dry van and less-than-truckload markets, as large equipment orders arrive in batches and absorb available capacity in concentrated bursts. Demand is unlikely to slow as long as consumers and businesses require faster data processing.

Even during a brief period when fuel prices appeared to be falling, average per-mile rates did not drop. When fuel prices rebounded, rates began climbing again.

Gulf Coast market pressures

The Gulf Coast region faces severe capacity constraints with load-to-truck ratios in the hundreds, exacerbated by tropical storm threats. Markets around Houston and Louisiana have load-to-truck ratios of hundreds and hundreds of loads to one truck. An approaching tropical storm could worsen these pressures by driving fuel costs and spot rates even higher.

The broker poker phenomenon

Using multiple third-party logistics providers on the same freight lane triggers carrier bidding strategies that ultimately increase rates rather than reduce them. John Conrad, Chief Revenue Officer at Evans Transportation Services, describes this dynamic as 'broker poker'. Flooding a lane with multiple competing 3PLs can cause carriers to delay accepting loads to extract higher rates, backfiring on shippers seeking savings.

Carriers may delay loads to extract higher rates when they recognize bidding competition from multiple 3PLs. Conrad stated, "And at the end of the day, I’m going to be able to get a little bit higher rate if I wait." Sometimes what can happen is when you flood the marketplace with too many bidders and too many 3PLs, you can actually do the opposite of what you're intending to do.

Evans Transportation's managed approach

Evans Transportation Services retains vetted 3PL partners for specific segments rather than engaging in rate arbitrage, preserving long-term relationships. The company offers managed transportation solutions, which Conrad described as outsourcing done right. Legitimate use of multiple 3PLs should be based on pre-existing, trusted relationships in specific business segments, not rate arbitrage.

Evans retains other 3PLs within its managed transportation solutions when a shipper already has a vetted partner on a given segment. The company avoids displacing long-standing relationships built over years or decades. Demand for heavy haul and open equipment is unlikely to slow as long as consumers and businesses require faster data processing.