Morgan Stanley sees supply-side ‘spark’ for trucking in 2026
Morgan Stanley is looking for a trucking recovery in 2026, but not because it expects demand to suddenly surge. Instead, the bank’s transportation team says the main driver could be tighter supply caused by new regulatory enforcement that reduces the number of trucks and drivers able to run.
In a 2026 outlook shared with investors, Morgan Stanley transportation equities analyst Ravi Shanker said the firm expects the enforcement shift to be meaningful enough to pull more than 5% of industry capacity out of the market.
“We believe supply tightening as a result of new driver regulations is real and sustainable and will put a rising floor on rates in 2026,” Shanker told investors.
Based on that view, Morgan Stanley upgraded its freight transportation industry outlook to Attractive for 2026. Shanker and his team said the risk-reward profile for the sector looks better than it has since 2020, even as the bank acknowledges the market still has challenges ahead.
The call comes after what the firm described as an “unprecedented downcycle” in 2025. Morgan Stanley’s view is that carriers could be entering 2026 in a better position as truckload capacity tightens and freight “spillback” becomes more of a factor.
For drivers, the key takeaway is that Morgan Stanley’s recovery thesis is built around the supply side—fewer compliant trucks available—rather than a demand boom. The firm expects tighter capacity to support rates by establishing a higher “floor,” and it also said shrinking trucking capacity will drive double-digit freight hikes in 2026.
At the same time, the bank noted broader pressures in the supply chain. It pointed to rising operating costs and volatility tied to tariff policy uncertainty, factors that can weigh on profitability—especially in long-haul—when shipping rates are soft.
- What changed: Morgan Stanley raised its 2026 view on freight transportation to Attractive.
- What’s driving the outlook: New regulatory enforcement that tightens supply, potentially removing more than 5% of capacity.
- Why it matters to drivers: The firm expects tighter capacity to create a rising floor for rates and contribute to double-digit freight hikes in 2026.
- What’s still a headwind: Higher operating costs and policy-related volatility across the supply chain.