Covenant Logistics CEO Projects Double-Digit Truckload Rate Hikes in 2027 as Q3 Revenue Jumps 19.2%

Covenant Logistics Group CEO David Parker said Friday he expects double-digit truckload contract rate increases in 2027, citing rising driver compensation, equipment, insurance and other operating costs. "We're going to continue to raise rates," Parker said on the carrier's third-quarter earnings call. "We have to because of the cost." Covenant (NYSE: CVLG) reported total revenue up 19.2% year over year to $353.9 million, with adjusted earnings per share rising to 50 cents from 44 cents. Truckload revenue per total mile climbed 19.8% to $3.03, though the average tractor fleet shrank 8.9% to 2,186 units. Shippers resetting contracts recently are paying about 12.8% more than prior rates, up from 4.1% a year earlier, per SONAR's CRCD index. Parker said about 58% of expedited tractors now operate under committed capacity agreements, up from roughly 40% at the end of the second quarter, with a target of 75%-80% by year-end. He also said federal enforcement, including potential third-party certification of ELD providers, could remove additional capacity from the market.