Strategic Planning for a Volatile Freight Landscape

Over the last few months, everyone’s wonderful business plans have been thrown a steady diet of curves and knuckleballs that have most swinging at air.

Between rapid policy shifts and unpredictable market behavior, there's an added layer of complexity that has companies reassessing everything from freight contracts to network design. 

Since the U.S. election in November 2024, the domestic transportation market has entered a state of flux. Key impacts include: 

• Demand softening across trade-sensitive verticals 

• Uncertainty driven by tariff threats, reversals, and policy revisions 

• Planning cycles disrupted by unclear political signals 

These conditions are forcing logistics operations into a delicate balancing act, where demand variability and geopolitical factors increasingly drive the conversation.

For logistics managers and supply chain executives, now is a critical moment to examine freight procurement strategies. Spot markets are offering substantial opportunities for cost savings, particularly for non-contractual freight. However, caution is warranted. 

While companies may be tempted to leverage the current “low” demand levels into new contract rates for transportation through network bids, the pendulum swings both ways. With demand currently depressed, carriers are underbidding to preserve volume, but once markets stabilize or rebound, capacity may tighten quickly. Logistics teams that over-index on short-term rate gains could find themselves deprioritized in favor of premium freight when volumes spike again.

 

Meanwhile, long-term infrastructure planning faces its own set of challenges. The electric vehicle (EV) transition, once a cornerstone of green logistics strategies, is hitting structural and political resistance.  

Tesla's stock is down considerably from its December 2024 high, reflecting both CEO-related backlash and broader skepticism about EV scalability. California’s rollback of its Advanced Clean Fleet mandate for port electrification by 2035, attributed to federal policy pressure, underscores the fragility of EV deployment timelines.   

Compounding the issue, rising awareness around the ethical sourcing of battery materials and the staggering power requirements for full EV adoption are prompting logistics and sustainability teams to take a harder look at what’s truly feasible. Even with a hypothetical breakthrough in battery chemistry, the U.S. power grid is not currently equipped to support mass electrification.  

And with AI data centers projected to consume a gigawatt each, comparable to the annual usage of one million homes, the demand for electricity is expected to surge dramatically in the coming years. 

 

Despite these headwinds, the federal government has made noteworthy moves to modernize transportation infrastructure. U.S. Secretary of Transportation Sean Duffy’s agenda prioritizes autonomous vehicle (AV) development, evidenced by the NHTSA’s new AV Framework. For logistics networks considering long-term automation, this framework may offer a pathway to more predictable regulatory compliance and investment planning.   

Perhaps more significantly, the formation of the Advanced Research Projects Agency – Infrastructure (ARPA-I) offers a glimpse into future-focused innovation. Modeled after DARPA, ARPA-I is designed to fund high-risk, high-reward transportation and logistics technologies. While operational details remain limited, its launch signals institutional recognition that transformative infrastructure upgrades are essential.

This is a moment that calls for listening, observing, and adapting. 

Change is the only constant in U.S. freight markets and those who embrace agility will lead. Logistics teams that stay proactive, thoughtful, and resilient will position their companies to not only survive the volatility but to turn disruption into strategic advantage. 

Want help pressure-testing your freight strategy? Reach out to us to see how we help shippers navigate uncertainty with confidence.