The freight market’s new reality: More risk, fewer signals

In mid to late 2025, cargo theft was among the top issues facing the freight market. Then English-language proficiency enforcement took the stage, followed by non-domiciled CDLs. There was the continued freight recession chatter.

None of those have gone away, but while the news cycle continues to churn out dramatic headlines, the underlying risk environment for carriers, brokers and their shipper partners, remains as fluid as ever. For freight leaders, the challenge is that the traditional signals around rates, capacity, and enforcement that once guided the market are becoming harder to interpret amid overlapping risks.

“I would say you don’t hear as much about it now,” said Kendra Phillips, VP of global transportation management at Ryder, told Supply Chain Management Review about cargo theft at the Manifest conference earlier this year. “The noise has quieted down, but it’s obviously still a very big concern in the industry.”

It’s just that there are so many risks today that no single issue is able to stay in the headlines for too long.

Cargo theft: Fewer headlines, more sophistication

Phillips said she believes cargo theft is actually worse than it was five or ten years ago, but the nature of the threat has evolved. Traditional theft at rest is now joined by increasingly organized identity fraud.

“You even see it in rail,” she noted. “People are asking, ‘Hey, I want to put my product underneath [on double stack trains]. I don’t want it on the top.’”

More concerning, though, are the fake carriers that brokers continue to battle.

“All the fake carriers that come up and they act as a credible carrier and get into your network for a couple of months … and then they take a load and they disappear,” she said.

She referenced what some describe as a “carrier mafia,” creating shell companies that perform legitimately long enough to build trust before stealing freight. Scott Cornell, vice president of transportation risk and strategy at LogistIQ Insurance Solutions, recently joined the Talking Supply Chain podcast to talk about cargo theft, noting that cargo theft incidents increased roughly 93% between 2021 and 2024, while strategic cargo theft—fraudulent schemes involving brokers, carriers, and falsified documentation—surged more than 1,400%.

For shippers used to vetting a carrier one time, the calculus has changed, Phillips said.

Vetting isn’t static

Phillips outlined a layered approach to carrier risk management—financial health monitoring, safety records, compliance flags and capacity validation.

“If you say that you only have 10 trucks in your fleet, are you accepting 12 loads? You can’t be,” she said, adding that continuous monitoring is critical. “It’s one thing to vet a carrier once and use them for three years. You need to be going down many layers … and make sure you’re getting continuous updates.”

She emphasized that shippers should be asking 3PLs hard questions such as:

• How deep does your vetting go?
• How frequently are carrier updates reviewed?
• How do you test new carriers before placing shipper freight?

CDL enforcement and English proficiency: Flashpoint or structural shift?

One of the most discussed freight topics in recent months has been enforcement around non-domiciled CDLs and English-language proficiency. Phillips confirmed there was a real impact late last year.

“As you went into Q4, there was a very sharp tightening,” she said.

Phillips, though, believes the combination of ramped-up enforcement and immigration pressures added to rate increases.

“We had a lot of carriers turning down loads … if they had to go into ICE-heavy areas,” she said.  

Taken together, all the factors have resulted in measurable capacity tightening. However, Phillips noted that enforcement intensity appears to have eased. “It feels like the enforcement has lightened up … but that’s a feeling, that’s not fact,” she observed.

From a shipper liability perspective, the issue remains serious. “They should be absolutely 110% concerned,” Phillips said.

In today’s nuclear verdict environment, any accident involving language proficiency or licensing questions could cascade upstream, resulting in brokers and shippers paying a heavier price.

AI in carrier vetting: Helpful, but not enough

With rising fraud and compliance risk, many logistics providers are leaning heavily into AI for carrier vetting. Phillips believes AI plays an important role, but should not replace human oversight.

“We let AI do a lot of it … but at the end it has to hand it to the human for the final, [sign off]” she said.

According to Phillips, that human touch is important as a “human’s going to suss out [if something] feels wrong or off?”

That human layer carries cost, but Phillips sees it as theft prevention insurance.

Freight rates: The inflection point approaching?

Phillips touched on a number of other issues facing the industry, including the recent rise in freight rates.

Phillips sees classic supply-demand dynamics playing out. “If you look year over year, freight volumes are down … about 6%,” she said. “Retail sales were flat … after products cost a lot more now than they did a year ago.”

Flat dollar sales, adjusted for inflation, imply declining physical volume, she noted. At the same time, capacity is exiting the market for many of the reasons mentioned previously. Capacity appears to be leaving the market faster than freight demand slows, creating an imbalance that could trigger an inflection point this year, Phillips said.

Emissions: Regulation may shift, shipper expectations haven’t

One approach the Trump administration has taken is to ease and even eliminate some of the more restrictive emissions regulations put in by previous administrations. But, while the requirements may be easing, Phillips doesn’t see the pressure from shippers easing.

“So many of our shippers are still very environmentally conscious,” she said, noting that reporting expectations remain regardless of the regulatory shifts. “They still want to know … what’s the impact I’m having on the environment?”

The bigger picture

If there is a common thread in Phillips’ perspective, it is that freight risk today is multi-layered. Cargo theft is more sophisticated. Fraudulent carriers are harder to detect. CDL enforcement can tighten capacity quickly. Freight volumes remain soft. Capacity is exiting faster than demand warrants.

The result is that there is more risk today than ever before. And as Phillips makes clear, technology alone won’t solve it.

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