Insolvencies in the trucking industry are climbing as the trade war drags on, CTV News reports — a hard, measurable sign that tariff-driven freight weakness has moved from rate screens to balance sheets.

Carriers are not just earning less. They are failing. Court filings and insolvency filings tied to trucking firms have increased as the tariff fight between Canada and the United States continues to choke cross-border volumes, according to the report.

What is driving the failures?

The mechanism is simple and brutal. Tariffs raise the cost of moving goods between Canada and the US. Shippers respond by shipping less, rerouting, or delaying orders. Freight volumes on key cross-border lanes fall. Trucking companies — many of them small operators running thin margins on leased equipment — lose loads while their fixed costs keep running.

When a carrier's revenue drops but the truck payment, insurance and driver wages do not, insolvency follows. The trade war did not create the industry's fragility. It exposed it.

What does this change for shippers and forwarders?

For shippers, fewer carriers means less capacity competition on some lanes, which could eventually firm up rates that have been depressed. In the short run, though, the bigger risk is counterparty failure: a carrier that goes insolvent mid-haul leaves freight stranded and claims unsecured.

Forwarders face the same arithmetic in reverse. They must now screen contracted carriers more aggressively, because a bankruptcy in their network becomes their service failure with the customer.

For surviving carriers, consolidation of this kind is grim arithmetic. Loads released by failed competitors can lift utilisation for those still running — provided their own balance sheets hold.

How long can this go on?

That depends on policy, not freight fundamentals. The report ties the insolvency trend directly to the continued trade war, and there is no relief mechanism inside the industry itself: carriers cannot tariff-proof their cost base. Until Washington and Ottawa ease the dispute, the sector's distress deepens with every month of suppressed cross-border demand.

Industry watchers should expect insolvency filings to keep rising while tariffs remain in place, with the strongest operators picking up the freight the failures leave behind.