The freight market is on the verge of a capacity-driven crisis that will catch flat-budget shippers off guard, according to ITS Logistics executives in an interview with FreightWaves published June 24, 2026. Ryan Martin, president of distribution and fulfillment at ITS Logistics, warned that shippers who enjoyed three years of rock-bottom transportation rates are about to feel serious pain. "We've been seeing the signs building for months," Martin said. "Shippers don't typically believe it until they start to feel the pain."

The warning comes as the post-pandemic inventory cleanup finally ends, but the damage runs deep. Products that once cost a dollar now run $1.52, turning excess inventory into a cash-flow nightmare. Every customer is pushing for better inventory turns due to rising costs from tariffs and transportation, Martin explained, forcing companies to manage their purchases much more carefully. One brand ITS works with is cutting 50% of its product catalog after calculating true carrying costs. During the pandemic, companies bought massive amounts of product that arrived in waves and kept selling—until it didn't. By 2022 and 2023, inventories had ballooned and warehouse space overflowed. Retailers typically won't discount items 50% to 75% just to move inventory sitting on the balance sheet as a cash equivalent, Martin noted. The inventory only moves when new leadership comes in and gets permission to liquidate, since they didn't purchase it and don't own the loss when it's sold.

Consumer behavior remains the biggest wildcard, and Martin has developed what he calls the "Cheerios vs. Gas Theory" to explain purchasing decisions. "No one could ever tell you what the box of Cheerios cost yesterday at the grocery store was even though it went up 50%," he said. "When you go to the pump, that resonates with everyone." Fuel serves as a universal economic anchor that everyone sees consistently, and when prices climb, anxiety follows across all spending categories. When fuel hit $7 or $8 per gallon in certain regions, e-commerce purchases dropped noticeably, especially for higher-end items. The paradox is striking: U.S. revolving credit card debt has reached record levels above $1.2 trillion while consumer sentiment remains weak. "We're in this weird scenario that we haven't been in, at least in my lifetime, because usually consumer sentiment typically follows GDP growth," Martin said.

Meanwhile, ITS Logistics is betting big on drop trailers as capacity tightens. Adam Angle, who leads trailer operations at ITS, said the company doubled its fleet from 2024 to 2025 and projects reaching about 13,000 ITS trailers by year-end. The strategy reflects a market reality: "It's definitely at times table stakes to have assets in these conversations," Angle said. Load tender volumes mirror 2019 levels, yet capacity continues leaving the market through driver exits, carrier closures, and increased regulatory scrutiny. The spot market has hit all-time highs "without any meaningful pick-up in demand yet," Angle warned. If demand suddenly spikes—driven by stabilizing fuel prices and low inventory levels—the market could shift violently. "If gas prices get back in line, inventories being low, this could be a real interesting peak season," Angle said.

The consequences for unprepared shippers could be severe. Companies have likely already built budgets, bonus structures, and internal approvals around flat transportation spend assumptions. "They're going to get challenged from a budgetary perspective this year if rates continue to increase," Martin said. "It's already happening, but it might just be the tip of the iceberg." Three years of soft markets have bred complacency among shippers who know the market is shifting but are trying to push off the reckoning as long as they can. The next rate-guide cycle could bring what Martin calls cascading rate-guide failures—a harsh awakening for an industry that stopped believing capacity crunches could return.