Less-than-truckload carrier Old Dominion Freight Line announced Monday it will implement a 4.9% general rate increase effective Dec. 4 on various tariff codes. The percentage increase is in line with a GRI taken earlier this year, but the effective date comes one month ahead of schedule.
Most carriers issue annual GRIs on general tariffs near the end or at the beginning of a year. General rate increases are used to adjust base rates to counter cost inflation and fund capital investments. While the percentage of the increase will vary by lane, distance and weight class, Old Dominion (NASDAQ: ODFL) expects this year’s hike to average 4.9%.
“In line with our economic forecast and expectations for the anticipated operating environment, OD is implementing a general rate increase to ensure the continued enhancement of our high-quality service network and systems,” said Todd Polen, Old Dominion’s vice president of pricing services. “This GRI, applicable to our class tariffs, aims to partially offset rising costs associated with new real estate and expansion projects, new equipment, technology investments, and competitive employee wage and benefit packages.”
The announcement follows other increases by carriers in recent weeks. The latest round of GRIs has come a little earlier for some compared to those issued a year ago as most carriers have seen a positive inflection in demand following Yellow’s exit.
Saia (NASDAQ: SAIA) recently announced a 7.5% GRI, which will also be effective on Dec. 4. The carrier’s increase was nearly two months earlier and 1 percentage point higher than the year-ago iteration. ArcBest (NASDAQ: ARCB) implemented a 5.9% GRI on Oct. 2. The GRI was in line with the year-ago increase but started one month earlier this year.
Some carriers have announced smaller increases this year.
FedEx Freight (NYSE: FDX) announced 2024 GRIs in late August. It said its Jan. 1 GRI will average between 5.9% and 6.9%, 1 percentage point lower on both ends of the range when compared to the 2023 rate bump. TForce Freight, a TFI International (NYSE: TFII) company, imposed a 4.9% increase on Oct. 2, which was 1 point lower than last year but implemented six weeks earlier this year.
XPO (NYSE: XPO) plans to issue a GRI during the first quarter of 2024, which is on schedule with its last GRI, and Forward Air (NASDAQ: FWRD) said it plans an increase of 5.9% to 7.9% as it does every year on the first Monday of February.