Transportation Finance & IFA Meeting Recap: Five Things We’re Watching

We recently returned from the International Factoring Association’s Transportation Factoring Meeting, and as always, one of the best parts was the people. We had the opportunity to spend time with clients, peers, long-term industry friends and partners, and several new faces, comparing notes not only on transportation factoring, but also on what is happening with carriers, brokers, freight rates, fraud, equipment finance and the broader economy. And there was a lot to talk about.

After several difficult years for trucking, there are some encouraging signs. 

Freight capacity has tightened. Freight rates are improving. But the message we came away with was not simply that “trucking is back.” The market is getting healthier in some areas while risks continue to shift in others. Based on that meeting and the discussions following with others in the industry, here are five things we’re watching.

1. Freight rates are finally moving in the right direction. Yes, encouraging for sure. Available truck capacity has declined considerably from the oversupplied market of the last several years, giving remaining carriers more pricing power. Recent market data support what we heard at the conference. According to the August 2026 Cass Transportation Index,[1] freight shipments posted their first year-over-year increase since January 2023, while the Cass Truckload Linehaul Index[2] was up 11.3% from a year earlier. That is certainly a positive. But there is another side…

2. Better rates don’t necessarily mean every carrier is healthier. One takeaway was the continued separation between the overall freight market and the financial health of individual carriers. Freight rates may be improving, but operating costs remain significant. Insurance continues to be a major pressure. Diesel can quickly consume improved freight revenue and remains a significant pressure. Equipment and financing costs remain elevated. And regulatory changes continue to affect the industry.
   
   We also heard considerable discussion about brokers tightening the standards carriers must meet before they will tender freight, including operating history, insurance requirements and verification procedures. For established, well-run carriers, fewer competitors and stronger rates can be good news. For a new or highly leveraged owner-operator, however, a higher spot rate does not help much if insurance costs are increasing, fuel is expensive, the truck payment is difficult to service or major brokers will not yet approve the carrier. The distinction matters.

3. For transportation factors, debtor credit is on watch. Factors naturally spend a lot of time evaluating their carrier clients and their account debtor customers. Brokers are dealing with their own pressures, including higher carrier costs, fraud, increased scrutiny around carrier selection and potentially tighter margins. At the same time, verification requirements are becoming more complicated. One example discussed at the conference involved owner-operators leasing onto another carrier’s authority. A receivable may be completely valid, but a broker may temporarily hold payment while confirming the lease relationship and who actually hauled the load. The result can be a longer DSO without an actual underlying credit problem. 
   
   For transportation factors, that makes it increasingly important to understand:
   
   • where broker and shipper concentrations are building;
   • whether debtor payment patterns are changing;
   • why particular invoices are aging;
   • who actually moved the freight and under whose authority; and
   • whether proper notification, verification and supporting documentation are in place.
     
     Fraud remains another major theme, particularly around carrier identity, double brokering and payment instructions. None of these issues are new. But the level of scrutiny around them continues to increase.

4. Factoring has opportunity, while the competitive landscape keeps evolving. There are some good tailwinds for transportation factors. Improving freight rates can increase invoice volume. Higher operating costs can make immediate liquidity even more valuable to carriers. And if the overall freight market continues to normalize, stronger carrier clients should benefit. At the same time, how carriers access liquidity continues to change. 
   
   Enter the continued expansion of enhanced quick-pay and “Factoring-as-a-Service” offerings, where technology providers can help brokers provide faster payment options directly to carriers. We do not think that replaces traditional factoring. Good transportation factors provide far more than early payment. They provide credit review, verification, collections, fraud controls, reporting and, in many cases, years of transportation-specific experience. But embedded finance and technology will continue to change the competitive landscape. 

5. Truck equipment lenders should watch both borrower performance and equipment values. Transportation finance does not end with factoring. Haversine also finances lenders supporting commercial truck equipment, so we continue to watch what is happening in that segment as well. There are some encouraging signals here too. Used heavy-duty truck inventories have declined considerably. Sandhills Global reported in August that used heavy-duty truck inventory was down 37.7% from the prior year, while used medium-duty truck inventory was down 33.2%.[3] Values, however, are not moving uniformly. ACT Research continues to report on used Class 8 pricing, sales activity and inventory trends, including stronger year-over-year sales activity even as average selling prices continue to fluctuate.[4] 
   
   A carrier default is never good news, but tighter equipment supply can potentially improve liquidation outcomes and reduce losses. At the same time, medium-duty and Class 8 equipment should not necessarily be viewed the same way. Class 5 through 7 vehicles serve a much broader group of businesses, including delivery, construction, utility, service companies and other vocational users. That means the health of the borrower’s underlying industry can matter every bit as much as the freight cycle. 
   
   For truck lenders, that comes down to two questions: How is the borrower performing? How is the collateral performing? A lender can still experience delinquencies or defaults while simultaneously seeing better resale conditions for certain equipment. Conversely, a seemingly healthy borrower may have financed equipment in a segment where used values remain under pressure. Both matter.

So where does that leave us?

We came home from the IFA Transportation Meeting more encouraged about the transportation market than we have been in some time. But the next phase may be just as interesting as the recovery itself.

Current industry forecasts suggest that the tightening we are seeing may continue into 2027. Capacity remains constrained, freight rates are higher, and many of the regulatory and economic forces that have pushed trucks and drivers out of the market will not reverse overnight.[5] If seasonal freight demand picks up during the fourth quarter, that could put additional upward pressure on rates before year-end.[6]

The bigger question is how much of those higher rates actually make it to the bottom line. Diesel remains expensive, insurance continues to rise, and financing, equipment and maintenance costs remain high. The U.S. Energy Information Administration currently expects diesel prices to remain elevated through the fourth quarter before easing in 2027.[7] If freight pricing remains firm while fuel costs begin to decline, that could create a better operating environment for stronger carriers next year.

For transportation factors, we will also be watching what happens upstream. Broker liability, carrier-verification standards, fraud prevention and debtor payment behavior are becoming increasingly important. At the same time, quick-pay and embedded finance offerings continue to grow, creating both competition and new opportunities across the transportation finance ecosystem.[8]

And for truck and equipment lenders, the story is becoming more segmented. The Class 8 market is being supported by tighter used-equipment supply and replacement demand, while medium-duty lending depends much more on the underlying application and borrower industry. Used-equipment values, inventories, borrower performance and recovery experience will all be important indicators as we move into 2027.[9]

Our takeaway is not that transportation risk has disappeared. Far from it. 

Rather, the market appears to be moving into a different phase. The strongest operators may finally have more pricing power, transportation factors may benefit from larger invoices and continued demand for liquidity, and equipment lenders could see better collateral dynamics in portions of the market. For those of us financing the industry, 2027 may be less about waiting for transportation to recover and more about understanding which parts of the market are positioned to benefit from the recovery already underway.

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Sources

[1] Cass Information Systems, Inc., Cass Transportation Index, August 2026. Freight Shipments Index increased 2.1% year over year, its first year-over-year increase since January 2023.
https://www.cassinfo.com/freight-audit-payment/cass-transportation-indexes/august-2026

[2] Cass Information Systems, Inc., Cass Truckload Linehaul Index, August 2026. The index measures changes in per-mile truckload pricing, excluding fuel and accessorial charges, based on freight invoice data. The August 2026 index increased 11.3% year over year.
https://www.cassinfo.com/freight-audit-payment/cass-transportation-indexes/truckload-linehaul-index

[3] Sandhills Global / TruckPaper, “Used Truck Inventory Continues to Drop While Auction and Asking Values Pick Up in August,” September 2026. Used heavy-duty truck inventory declined 37.7% year over year and medium-duty inventory declined 33.2%.
https://www.truckpaper.com/blog/sandhills-news/2026/09/used-truck-inventory-continues-to-drop-while-auction-and-asking-values-pick-up-in-august

[4] ACT Research, U.S. Classes 3–8 Used Trucks Market Update, 2026. ACT Research tracks used Class 8 retail sales, average pricing, age, mileage and inventory trends.
https://www.actresearch.net/resources/blog/us-classes3-8-used-trucks-blog

[5] ACT Research, Trucking Industry Forecast 2027, August 2026. ACT expects constrained capacity, limited driver availability and improving freight pricing to continue shaping the market into 2027.
https://www.actresearch.net/resources/blog/trucking-industry-forecast-for-2027

[6] Uber Freight Q3 2026 Market Update, reported by FreightWaves, September 2026. Uber Freight noted that limited capacity could lead to another spot-rate increase if fourth-quarter freight demand accelerates.
https://www.freightwaves.com/news/uber-freight-warns-tight-capacity-could-fuel-q4-freight-rate-surge

[7] U.S. Energy Information Administration, September 2026 Short-Term Energy Outlook. EIA forecasts U.S. retail diesel averaging approximately $5.55 per gallon in Q4 2026 and $4.40 in 2027.
https://www.eia.gov/pressroom/releases/press592.php

[8] International Factoring Association, “Transportation Minute: The Structural Recalibration of the Transportation Industry,” May 2026; Truckstop Financial, August 2026. Recent industry commentary highlights increasing broker liability and carrier-selection scrutiny alongside continued growth in embedded quick-pay and factoring platforms.
https://magazine.factoring.org/magazine-articles/transportation-minute-the-structural-recalibration-of-the-transportation-industry-after-montgomery-v-caribe-transport-ii-and-recent-fmcsa-regulatory-actions
https://magazine.factoring.org/news/truckstop-financial-processed-3-billion-in-its-first-year

[9] ACT Research, 2027 Class 8 Truck Market and 2027 Trucking Industry Forecast, August 2026. ACT expects stronger Class 8 replacement demand while noting elevated medium-duty inventories and differing demand by application.
https://www.actresearch.net/resources/blog/class-8-truck-sales-forecast-2027
https://www.actresearch.net/resources/blog/trucking-industry-forecast-for-2027

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