Data-center construction is one of the factors behind a trucking boom that has pulled the industry out of a freight recession

A recovery for trucking rates sets up a strong second half of 2026 and beyond for U.S. trucking companies.

Business is booming for U.S. freight companies, thanks to strong demand from manufacturing customers, a rush of data-center construction and capacity constraints.

What's more, higher freight rates are expected to be here to stay, despite challenges for the industry such as pricier diesel, which hits smaller operators more, and lingering concerns about the U.S. economy and the health of U.S. consumers.

Trucking stocks have outperformed the broader stock-market benchmarks, with the Dow Jones U.S. Trucking Index XX:DJUSTK about 30% higher so far this year, following losses of about 7% last year and of around 4% in 2024.

The industry is coming out of a so-called freight recession. Rates started going lower by late 2022 and 2023, following heady gains from a pandemic-fueled boom in the consumption of goods.

Now, "truckers are finally starting to make some money," said Lee Klaskow, a logistics analyst at Bloomberg Intelligence. "For the last three to four years, a lot of them were struggling."

Some of the smaller, privately held operators have used the current boom as an opportunity to pay down debt rather than focusing on getting ahead, he added.

Now it looks like the industry may be headed "higher for longer," Klaskow said.

"It really feels that this rate recovery has sustained legs, which should set up not only a strong second half of 2026 for trucking companies, but also a strong 2027," he said. He also predicted ripple effects across other modes of transportation, such as rail.

Spot freight rates, or those based on real-time, on-demand truck availability, have risen about 35%, while contractual rates, or those prearranged, have risen about 10%, industry insiders say.

The tough environment of the past four years or so forced some carriers out of business, particularly smaller companies. The industry is fragmented, with the vast majority of carriers operating 10 or fewer trucks.

Some of the major publicly traded companies in the market include Knight-Swift Transportation $(KNX)$, XPO Inc. $(XPO)$, Schneider National (SNDR) and TFI International (CA:TFII). Their stocks are all enjoying double-digit gains this year.

Jason Seidl, an analyst with TD Cowen, favors Knight-Swift and XPO among them.

Knight-Swift has been growing its less-than-truckload business, and Wall Street hasn't given the company much credit for it, Seidl said. XPO is also a strong player in the LTL market, which tends to be more profitable, and has been positioning itself to snap up truck terminals and improve its network after the bankruptcy of Yellow Corp. in 2023.

Knight-Swift and XPO "got a couple idiosyncratic levers that they're pulling and that I don't think others have," he said.

Pandemic-fueled boom led to overcapacity

The last time the industry saw something similar was during the COVID-19 pandemic as Americans found themselves largely unable to spend on services, prompting them to buy more physical products instead.

But as the pandemic wore on and e-commerce boomed, the industry became swamped and additional small- to mid-size carriers entered the market. Eventually, that created an oversupply of capacity, said Joel Sutherland, a professor of supply-chain management at the University of San Diego's Knauss School of Business.

As consumer demand softened, the industry tried to right itself again, and by late 2025 and early 2026, it seemed that the end of the slump was finally in sight.

Then, a "tsunami of issues" created more challenges, Sutherland said. That included a regulatory crackdown on who could hold a commercial driver's license, partly tied to the Trump administration immigration policies, stricter enforcement of English-proficiency rules for drivers, and increased oversight of truck-driving schools. Some of them closed their doors.

The enforcement and focus on safety regulations was "long overdue" in the industry, said Seidl. Some of the shuttered schools, for instance, were found to have churned out commercial driver's licenses within 24 to 48 hours, and some didn't even have trucks.

"That's scary. That's people on the highway next to us driving vehicles up to 80,000 pounds," Seidl said.

Rising diesel prices have been a headwind but one that companies, particularly larger operators, have been managing for years by tacking on fuel surcharges. Fuel is the industry's No. 2 cost after labor.

Diesel, the fuel of choice for heavy-duty commercial trucks, is averaging $5.62 a gallon nationwide, compared with an average of $5.30 a gallon just a month ago, according to AAA.

The recent price spikes, however, make it harder to manage fuel costs, even with the surcharges in place, as trucking companies might base any extra fees on prices that are no longer current. Trucks also drive what are called "empty miles," or miles driven between shipments, that are not covered by a surcharge.

'Gangbuster' data-center construction is tailwind

The industry's boom is coming despite weakness in the housing market, traditionally one of its pillars. That's in part thanks to the construction boom for data centers. The U.S has more than 3,000 operating data centers, and despite growing opposition to such facilities, more than 1,500 new data centers are in various stages of development.

Flatbed trucking, which utilizes trailers with no roof or sides to haul heavy and often odd-size equipment, are at the center of the data-center boom.

Rates for flatbed trucking are "a lot stronger" because of data-center construction, said Avery Vise, vice president of trucking at FTR Transportation Intelligence. That strength ends up spilling over, to some degree, to other truck modalities, such as refrigerated trucks and dry-van trucking, he said.

"If you look at everything else, there's really no other strength, the housing market is quite weak. There is some recovery in industrial ... but it's fairly early stage still. What's really been growing gangbusters" has been the construction of data centers, Vise said.

Data centers, often massive, require equipment for heating and cooling, ventilation, and water supply. "Once the facilities are built, then you also have the hauling of the equipment that goes in it," Vise said.

"If data-center construction were doing what it's doing and the housing market were strong, I don't even know how the flatbed sector can even handle it. It would be insane. It would be impossible for them to keep up with that demand, I think," he said.

The "big unknown" for the industry is macroeconomics, and potential weakness in consumption, TD Cowen's Seidl said. But the industry is stronger now, he said.

"We're setting up for a multi-year recovery because in the past, cycles were shorter, because you had the ability to backfill capacity relatively quickly," Seidl said. After a four-year downturn, that ability to quickly backfill capacity is gone, and consumer demand is holding, he said.

-Claudia Assis