Manufacturing PMI hits 4-year high; LTL carriers capitalize on demand surge

July's Manufacturing PMI reading of 55.6 marks the highest level in four years and signals robust economic expansion across the industrial sector. This seventh consecutive month of growth, coupled with rising new orders and improving employment conditions, directly translates to increased freight demand, particularly for less-than-truckload (LTL) carriers where roughly two-thirds of volumes tie to manufacturing output.

The data reveals a significant inflection point: LTL carriers reported an average 5.1% year-over-year tonnage growth in preliminary July results, with outperformance against seasonal norms ranging from 250 to 400 basis points across major carriers. This demand surge occurs against a backdrop of persistent supply chain tightness, evidenced by an ISM supplier deliveries index of 58.9, indicating slower delivery performance and lingering constraints across eight consecutive months.

For supply chain professionals, this convergence of strong demand and constrained capacity creates both opportunity and urgency, carrier pricing power is evident through rate increases and service-level improvements, while shippers must navigate inventory restocking against the backdrop of extended lead times.