Dedicated contract carriage vs. dedicated truckload capacity – The search for untapped capacity

Dedicated Truckload Capacity growth is five times that of traditional Dedicated Contract Carriage according to Armstrong & Associates, Inc. (A&A’s) newest report, “Dedicated Contract Carriage vs. Dedicated Truckload Capacity – The Search for Untapped Capacity.” Dedicated Truckload Capacity (DTC), where a provider agrees to providing ongoing trucking capacity to a customer account in specific lanes or routes and equipment can be shared between customers, has seen tremendous growth over the past 10 years. In 2020 alone, DTC net revenues jumped 30.6% to $6.3 billion among dedicated transportation providers as market demand continues to search for untapped capacity.

In the traditional, asset-heavy DCC Third-Party Logistics (3PL) market segment, specific trucking assets are dedicated to a customer account for a given contract length. The segment provides core trucking capacity to its buyers in a market subject to cyclical driver/tractor shortages. In 2020, the DCC segment had the second highest net revenue growth of the four 3PL market segments with just 0.3% to $20 billion. The negative effect of COVID made 2020 a volatile and lower-volume year versus 2019 when DCC net revenues grew 12.1%.

In addition to historical and projected estimates for DCC and DTC, the report also covers the different characteristics of each segment, contract terms, profitability, power units, equipment assignment, industries served, lease versus truckload providers, the 25 largest U.S. DCC providers and more.