The Freight Market is Healthier Than You Think
David Parker, CEO of Covenant Logistics Group, discusses the evolving freight landscape, including the impact of emissions standards, the move away from commoditized OTR, and surprising insights into specialized markets like live chicken hauling. He shares his views on the future of electric and autonomous trucks, and how economic factors like GLP-1 drugs are affecting […] The post The Freight…
Covenant Logistics Group CEO David Parker revealed in a recent interview that the U.S. freight market is healthier than many carriers believe. Load-to-truck ratios declined from 2-to-1 in the first half of 2025 to 1.3-to-1.5 starting in July and August, a trend Parker called healthier and more sustainable heading into peak season.
Parker stated that the moderation in ratios is still tight enough to support rate increases without attracting new market entrants. Most truckload carriers posted double-digit rate increases in the second quarter, but operating ratios only improved by about 1 point as costs rose at the same rate. Parker believes that another double-digit rate increase is needed for the industry to remain healthy.
Shippers are more focused on securing capacity rather than resisting rate hikes, as long as pricing remains fair. On the supply side, 2% to 3% of industry capacity has already exited, and more is still leaving due to FMCSA enforcement. Parker will be in Washington, D.C., to assess regulatory activity.
Looking further into the future, Parker expects a 3-to-4-year supercycle driven by domestic manufacturing investment and data center construction. Data centers are projected to be under development through at least 2032, with servers needing replacement every 3 to 5 years. Covenant Logistics Group's growth strategy focuses on exiting commoditized over-the-road freight in favor of high-service niches.
An example is its acquisition of Lou Thompson, a live-haul chicken carrier that grew from 230 to 800 trucks since 2023. Covenant now operates approximately 60% Freightliner and 40% Peterbilt trucks. Parker identified AI data centers as another high-value target and is working with an international freight forwarder to match freight and maximize asset utilization.
Currently, Covenant does not see any customer willing to pay for an estimated $350,000 Tesla Semi, except in California incentive programs, due to the cost gap compared to conventional trucks.
Written by urgent.news from FreightWaves's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
