How Drayage Providers Can Brace For A Likely Dip in Inbound Port Volumes

With inbound traffic at major U.S. ports up during the first half of this year, on a year-by-year basis, one might think the outlook would be pretty strong for the drayage industry. But warnings abound that may not be the case.

FreightWaves recently reported that, while year-by-year imports during the first half of 2025 are up 3.2 percent compared to 2024, looming signs leave serious doubt about whether the rest of the year will be anything like that.

And no one should be surprised that the primary factor leading to this outlook is tariff policy.

Quoting shipping consultant John McCown, FreightWaves points to trends and policy impacts that should leave drayage firms bracing for a challenging period:

“[July was] a temporary reprieve and was driven by frontloading to get goods in prior to additional tariffs going into effect in early August,” McCown wrote in a monthly update, noting the slight bounceback followed decreases of 8.3% in June and 6.6% in May.

“The trailing three-month figures continue to show inbound volume in a pronounced downtrend that has now been going on for six months. Outbound volume in July was down 0.3%, the fourth straight decline coming after decreases of 1.7% in June and 2.3% in May.

For the three months ending in July, inbound volume was down 3.7% and it has been in a consistent downward trend since the three months ending in January when it showed a 14.0% increase.”

A report from the National Retail Federation predicts that total 2025 import volume will be down 5.6 percent compared with 2024, which is unusual considering historical trends:

“Given that year-to-date volume for the first seven months of 2025 is actually up 3.6%, that projection translates into volume for the five months remaining in 2025 to be down 17.5%,” the report stated. “The inbound declines in the balance of this year will be completely driven by tariffs. I anticipate a negative trendline with some months showing more than 17.5% decreases.”

Entourage Freight Solutions calls this a “race to the bottom” for drayage companies:

Traditional drayage operators are being squeezed by rising operational costs, tech-enabled competition, and increasingly stringent environmental regulations, especially in California. Industry leaders describe an unsustainable pricing race in which even a $50 bid difference can mean lost business. 

Companies like GSC Enterprises have shuttered, while others warn of a wave of buyouts targeting small operators with fewer than 50 trucks. The post-COVID influx of capacity and the rise of asset-light brokers are further pressuring margins. California's clean-air mandates and indirect source rules are compounding the challenges and accelerating consolidation. 

“This race to the bottom has to end,” said Matt Schrap of the Harbor Trucking Association.

C.H. Robinson says the low demand for inland drayage services is having a depressing effect on rates:

Despite the Port of Los Angeles experiencing the highest June and July volumes in its more than 100-year history, inland drayage rates remain below pre-pandemic levels. This is creating unsustainable margin pressure on carriers while providing temporary cost relief for shippers.

The volume surge stemmed from importers rushing cargo ahead of higher U.S. reciprocal tariffs, but this premium freight commanded higher rates for the expedited handling. Standard freight has been experiencing longer wait times as carriers prioritized higher-paying, time-sensitive shipments over routine deliveries.

In other words, extremely competitive rates may come with service tradeoffs. Carriers under significant cost pressure may struggle to maintain consistent service levels during peak periods or operational disruptions. 

Martin Lew, CEO of Commtrex, urges drayage providers to find opportunities to add value to their services as they compete for – at least in the short term – limited demand for their services.

“Drayage providers cannot do anything about depressed demand that results from tariffs,” Lew said. “It’s entirely outside their control. And I understand the temptation to pull back on services to save money and maintain competitive rates. But where possible, drayage companies should examine their operations to find where they can efficiently add value. That could include technology platforms that move them in and out of the ports more efficiently, or enhancing the effectiveness of transloading operations. And of course, carriers for whom drayage is only part of their offerings will want to maintain strength in other areas.”

Lew says the tariff-driven drop in import activity will likely even out over time as trade policy stabilizes. But for now, drayage providers would be wise to invest where they can in their highest-value shipper relationships.

“This will not last forever, and the best customers will remember the drayage providers who came through during such a difficult time,” Lew said. “I realize not every drayage carrier can absorb what might require a short-term cash-flow crunch to maintain such a high level of performance. But those who can and who do will emerge from this in a stronger position.”