Trucking News · Tennessee · October 31, 2026

Covenant Logistics CEO Says Truckload Contract Rates Should Rise by Double Digits Again in 2027 as Costs Climb for Truckers and Carriers

By Big Rig Daily Staff

The chief executive of a Tennessee trucking company says shippers should plan on paying more again next year. David Parker, CEO of Chattanooga-based Covenant Logistics Group, said on the company's third quarter earnings call on Friday, Oct. 30, that carriers will need more rate increases to offset higher costs, according to FreightWaves.

In his words

"We're going to continue to raise rates," Parker said. "We have to because of the cost." He pointed to inflation in driver pay, equipment, insurance and other operating costs. When an analyst asked whether Covenant expects another year of double digit contract rate increases in 2027, Parker answered: "That's my expectations." These are the views of one carrier executive, not a forecast from the market as a whole.

What contract rates are doing now

FreightWaves reported that, as of Thursday, shippers who reset their truckload contracts in recent months are paying about 12.8% more than the rates they replaced, according to SONAR's Contract Rate Change Direction index. A year earlier it was 4.1%. Big Rig Daily has also covered contract rates resetting 13% higher and Knight Swift's CEO on mid-teens contract increases for 2027.

Trucks that get paid to wait

Much of the call focused on a change in how Covenant's expedited business works. At the end of September, about 58% of its expedited tractors were under committed capacity agreements, up from about 40% at the end of the second quarter. Parker said he expects that to reach 75% to 80% by the end of the year, up from about 25% at the beginning of 2026.

Parker said demand for high security freight, including technology shipments and equipment tied to data centers, is driving the shift. "Technology loads have just been exploding," he said. Some customers are signing contracts of two to four years. Unlike traditional expedited trucking, the new arrangements often pay Covenant to keep secure capacity available even when trucks are waiting. Some of these operations may run around 3,000 miles a week, compared with 5,000 in the traditional expedited network.

Other numbers from the quarter

Total revenue rose 19.2% from a year earlier to $353.9 million, and adjusted earnings per share were 50 cents, compared with 44 cents. Covenant's average truckload tractor fleet fell 8.9% to 2,186 trucks from 2,400, even as freight revenue per total mile rose 19.8% to $3.03. Management said finding qualified team drivers is getting harder, and that training drivers for high security freight takes extra time.

On enforcement

Parker said he believes FMCSA remains committed to enforcement involving driver training schools, commercial driver's licenses and electronic logging devices, and that he did not think the agency was retreating. He said he expects continued enforcement to remove more trucking capacity, particularly among team operations. He also said he believes about 30% of trucks using ELDs may be operating with manipulated records, calling it "a gigantic number." FreightWaves did not report data supporting that estimate, so treat it as his opinion.

Quick facts

• Who: David Parker, CEO of Covenant Logistics Group, on the Oct. 30, 2026 earnings call.
• His expectation: double digit truckload contract rate increases in 2027.
• SONAR index: recent contract resets about 12.8% higher, versus 4.1% a year earlier.
• Expedited tractors under committed capacity: about 58% at the end of September.

A question for readers

If contract rates climb by double digits again, how much of it do you think will reach the trucker's paycheck?

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