Canada’s Trucking Industry Faces a Double Crisis: Prolonged Freight Slowdown Followed by Rising Diesel Costs

CTOA warns rising diesel prices, now exceeding $2.39 per litre in Toronto, are adding pressure to small carriers and independent operators already recovering from a prolonged industry downturn

MISSISSAUGA, ON, March 30, 2026: The Canadian Truck Operators Association (CTOA) is raising concerns over rising diesel prices, warning that increasing fuel costs are placing renewed pressure on a trucking industry that is still in the early stages of recovery following a prolonged slowdown from 2022 through 2025.

Recent increases in global oil prices, driven by escalating geopolitical tensions in the Middle East affecting key energy supply routes, are beginning to translate into higher diesel costs across Canada. For the trucking sector, where fuel remains one of the largest operating expenses, this trend is creating immediate financial strain, particularly for small and mid-sized carriers.

Diesel prices in major markets such as the Greater Toronto Area have recently exceeded $2.39 per litre, levels not seen since 2022. For many operators, this represents a significant increase in day-to-day operating costs.

While larger carriers may have mechanisms to manage fuel volatility, smaller fleets and independent operators often have limited ability to pass on sudden cost increases, creating immediate pressure on margins and cash flow.

“Canada’s trucking industry has gone through several difficult years, and many carriers are only now beginning to stabilize,” said Tej Dulat, spokesperson for CTOA. “A sudden increase in fuel costs at this stage creates real pressure for businesses that are already operating on thin margins. This is not about avoiding normal market cycles, it is about recognizing the impact of external cost shocks on an essential industry.”

A Fragile Recovery at Risk

The current increase in diesel prices comes at a sensitive time for the industry.

Between 2022 and 2025, Canadian trucking experienced a prolonged period of weak freight rates, excess capacity, and rising operational costs. Many small carriers and owner-operators managed this period by reducing expenses, deferring investments, and operating with minimal financial reserves.

While early signs of stabilization have begun to emerge in 2026, the recovery remains uneven. Rising fuel costs now risk slowing that recovery, particularly for operators with limited ability to absorb additional cost increases.

The View from the Ground

“I run four trucks out of the GTA. Fuel has gone from about $1,600 to $2,300 per truck, that’s a $700 increase every fill. I am transporting essential goods and can’t stop operating, but after three difficult years, there is very little left to absorb these costs. My line of credit is already stretched.”
Jagroop, CTOA member, Greater Toronto Area

“I have been operating for 14 years, and have never seen two pressures hit at the same time like this. After years of low freight rates, diesel is now above $2.40 with no clear timeline for relief. This goes beyond normal market conditions, it is a situation operators cannot plan for or control.
Singh, CTOA member, Hamilton

Broader Supply Chain Impact

The impact of rising diesel prices extends beyond the trucking industry. Trucking plays a central role in Canada’s economy, with the majority of goods transported by truck at some stage of the supply chain. As transportation costs increase, those costs can flow through to businesses and consumers in the form of higher prices for goods and services.

Fuel volatility therefore has implications not only for carriers, but for overall supply chain stability and affordability.

CTOA Encourages Consideration of Targeted Measures

CTOA is encouraging the Government of Canada and the Government of Ontario to consider practical, short-term measures to support industry stability during periods of fuel volatility:

Temporary diesel tax relief for commercial carriers
Targeted bridge financing access for small carriers and owner-operators
Review and update of fuel surcharge mechanisms
Industry-government roundtable on trucking sector stability
Short-term flexibility in compliance implementation for small carriers

CTOA emphasizes that the industry is not seeking long-term subsidies, but targeted, short-term support to help stabilize an essential sector during a period of exceptional cost volatility.

Looking Ahead

CTOA will continue to monitor developments and engage with industry stakeholders to assess the impact of rising fuel costs across regions and business segments.

The association remains focused on supporting a stable, resilient trucking sector that can continue to meet the needs of Canada’s economy and supply chains.

After two years of oversupply and compressed margins, Q1 2026 shows early evidence of a tighter, more disciplined carrier base. The next 18 months will reward carriers who manage capital carefully, adapt to regulatory change, and monitor a set of converging trade, infrastructure, and workforce pressures that are reshaping the industry’s operating environment.

Section I: Current Market Conditions

The excess capacity that weighed on Canadian freight markets through 2024 and into 2025 is beginning to clear. This is not a demand-driven recovery, it reflects the exit of smaller, undercapitalized carriers who were unable to absorb sustained cost increases across insurance, fuel, financing, and maintenance.

The result is a leaner industry than existed two years ago. The remaining carrier base is, on balance, better capitalized and more operationally disciplined. That shift is beginning to reflect in spot rates, which have stabilized and shown early signs of a modest recovery in several key corridors.

4-6%

SPOT RATE RECOVERY

Year-over-year rate improvement in key Canadian corridors as of Q1 2026, per industry analyst consensus. Recovery remains uneven across sectors and regions.

10-15%

CAPACITY SHORTFALL

Driver vacancy rate reported by a segment of CTOA member carriers in early 2026, adding a structural supply constraint alongside equipment-side contraction.

The persistent challenge is what analysts call a cost-revenue squeeze: Operating expenses, particularly insurance premiums and maintenance labour, continue to rise faster than freight rates. Carriers that have survived this cycle are those who controlled variable costs aggressively. That discipline will remain a competitive differentiator through 2027.

Market Signals – Q1 2026

Operating authority cancellations have accelerated as smaller fleets exit under sustained margin pressure.
Spot rates stabilizing, modest early recovery in Toronto-Montreal and Toronto-Calgary corridors.
Used equipment demand rising as new truck pre-purchases begin to build ahead of 2027 regulatory changes.
Insurance premiums remain elevated, cargo theft is contributing materially to claims costs in the GTA/Peel corridor.
11000 plus transport driver positions were vacant in Canada as of Statistics Canada Q3 2025 – a structural, not cyclical, shortage.

Section II – Two Developments to Watch in 2026

Two distinct developments will materially affect Canadian freight flows this year. Both carry meaningful uncertainty and warrant closer attention from carriers than they have received so far.

The Gordie Howe International Bridge

Canada’s most significant trade infrastructure investment in decades is approaching its opening. Construction of the Windsor-Detroit crossing is complete. As of March 2026, the bridge is in its testing and commissioning phase, with toll rates officially announced on March 11. Commercial vehicle tolls are set at US$8.75 / CA$12 per axle, materially lower than the Ambassador Bridge’s current rate of US$20 per axle. The U.S. Department of Homeland Security formally designated the crossing as a Class A port of entry effective March 2, 2026.

No firm opening date has been confirmed as of the publication of this report. The Windsor-Detroit Bridge Authority has indicated a spring 2026 target, contingent on completion of quality reviews and readiness of border agencies on both sides.

Political Risk – Monitor Closely

In February 2026, U.S. President Donald Trump raised concerns regarding the bridge’s toll structure and construction materials. Canadian officials, including Prime Minister Carney, addressed these claims directly. The threat has not been formally withdrawn. Members with significant Windsor-Detroit exposure should monitor this situation before building the new crossing into routing and scheduling plans. CTOA will issue an advisory when an opening date is confirmed.

If and when the bridge opens on the currently projected timeline, carriers can reasonably expect: reduced congestion at the Ambassador Bridge, more predictable border processing times, a competitive toll environment, and a direct Highway 401 to Interstate 75 connection that eliminates the current city-street routing on the Canadian side.

“About US$250 billion in goods cross the Detroit-Windsor corridor annually. CBP projects the new bridge will reduce average crossing times by up to 30 percent once fully operational.” “U.S. Customs and Border Protection, Federal Register, January 2026″

The CUSMA/USMCA Joint Review – July 1, 2026

The mandatory six-year review of the Canada-United States-Mexico Agreement begins July 1, 2026. This is a structured joint review, not a formal renegotiation. The agreement does not expire or automatically change on that date; if parties do not agree to extend it, the process shifts to annual reviews. The agreement remains in force throughout.

That said, the current U.S. administration has signalled it intends to use this review to seek material changes, and the broader trade environment, including the 25% tariffs imposed on Canada in early 2025 and subsequent partial relief, underscores that cross-border freight operators are navigating genuine policy volatility. The tariff situation has shifted multiple times in 2025 and 2026; members with cross-border exposure should verify their specific commodity’s current tariff status with a customs broker rather than relying on any fixed figures.

July 1

CUSMA Review Begins

Mandatory six-year joint review. Agreement remains in force. Outcome uncertain under current U.S. administration.

Rules of Origin

Key Compliance Area

Auto parts and steel classifications will face the most scrutiny. Review your commodity compliance before July.

~$250B+

Annual Corridor Value

The Windsor–Detroit corridor is a critical trade gateway, within over $1.3 trillion in annual Canada–U.S. trade.

Cross-border fleets should use the period between now and July to review rules of origin compliance, particularly for automotive components and steel products, and to strengthen customs documentation practices. This is preparation, not alarm.

Section III – The 2027 Emissions Transition

The most significant equipment cost event in years is approaching. The U.S. EPA’s 2027 greenhouse gas and low-NOx standards for heavy-duty vehicles will drive a step change in new truck pricing. Because North American original equipment manufacturers produce to a single continental standard, Canadian carriers purchasing Class 8 trucks will face the same cost increase as their U.S. counterparts.

Current industry estimates, from CDK Global and truck manufacturer guidance, project new 2027-compliant trucks at approximately $20,000–$25,000 more per unit than equivalent 2026 models, primarily due to more complex aftertreatment systems. These systems also carry meaningful maintenance implications during their early years in service.

What Members Need to Know – 2027 Emissions Rule

The rule is a U.S. EPA rule: Canada’s Heavy-Duty Vehicle GHG Regulations run in parallel but on a separate schedule, verify with your dealer what applies to your fleet
The EPA signaled in early 2026 that a revised proposal is expected in spring 2026, which could reduce per-unit cost impact while maintaining the 2027 start date
Members should avoid locking in large pre-buy orders until the revised rule is finalized (expected Q2/Q3 2026), as cost structures may change
The pre-buy cycle (rush to purchase 2026-spec trucks before Q4) is real, but early movers risk buying ahead of potential regulatory adjustments
Used equipment values are expected to rise as demand for 2026-spec diesel trucks increases, relevant for fleets considering disposals this year

The practical planning recommendation is clear: evaluate your fleet replacement schedule now, but avoid reactive purchasing before the revised EPA rule is published. The window for informed decision-making is approximately Q2 2026.

Section IV – Regulatory & Workforce Pressures

Tax Compliance – T4A Enforcement Is Live

The CRA’s moratorium on T4A penalties for independent contractors in the trucking sector has ended. The reporting deadline for the 2025 tax year, T4A Box 048 for fees paid to Canadian Controlled Private Corporations over $500, passed on Feb 28th, 2026 (March 2, 2026). Enforcement is active. This is not a future concern, it is the current operating reality.

CTOA’s position has been consistent: comply with reporting requirements, and expect CTOA to ensure enforcement is applied fairly & consistently. If you received a compliance notice and have not yet responded, contact info@thectoa.ca immediately.

Workforce – A Structural Shortage, Not a Cyclical One

Statistics Canada reported 11000 plus vacant transport truck driver positions in Q3 2025. Multiple CTOA member carriers report current vacancy rates of 10% to 15%. This is not a short-term matching problem, it reflects an aging driver demographic, insufficient domestic training pipeline, and in CTOA’s assessment, retention barriers including discriminatory treatment and online hostility toward racialized and newcomer drivers that is driving experienced workers out of the industry.

Immigration pathways remain a material component of driver supply. Members relying on workers through temporary permit programs should verify current Express Entry draw categories for transport occupations directly with an immigration lawyer or through IRCC, as program criteria and draw schedules evolve regularly. CTOA will share updates as IRCC confirms 2026 draw schedules.

Cargo Theft – A Growing Operational and Financial Risk

North American cargo theft losses reached an estimated $725 million in 2025, with hundreds of documented incidents in Canada and the United States in Q3 2025 alone. Criminal networks have adopted more sophisticated methods, including fictitious carrier identities and fraudulent load authorizations. The GTA and Peel Region represent a disproportionate concentration of incidents.

CTOA launched a national freight security initiative in March 2026 to address this through real-time information sharing, and coordinated engagement with law enforcement. The initiative is operational and member participation is open. Contact info@thectoa.ca for details.

Section V – Strategic Priorities for 2026

The following recommendations reflect current market and regulatory conditions. They are intended as a framework for decision-making, not a prescriptive plan.

Evaluate Fleet Replacement Timelines –

But Wait on Large Orders

Know your replacement schedule. Do not commit to large pre-buy orders before the EPA publishes its revised 2027 rule in Q2/Q3 2026. Monitor the market carefully through summer.

Prepare for the Windsor-Detroit Corridor Shift

Once the Gordie Howe Bridge opens, toll competition and routing changes will affect lane economics. Build familiarity with the new crossing now.

Review Cross-Border Compliance Before July 1

Audit rules of origin documentation. Engage a customs broker if needed. Do not wait for the CUSMA review to trigger action.

Strengthen Cargo Security Protocols

Implement two-step verification for load releases. Join CTOA’s freight security initiative to reduce risk and insurance exposure.

Protect Margins Through Cost Discipline

Focus on insurance, fuel efficiency, and maintenance optimization. Benchmark against peers in your operating corridor.

Engage With CTOA’s Policy Work

Policy changes around independent driver classification and enforcement are underway. Member participation ensures your voice is represented.

CTOA Outlook :- 2026–2027

The conditions ahead do not reward the fastest or the largest. They reward carriers who manage their balance sheets carefully, anticipate regulatory change before it becomes a crisis, and operate with the discipline that the last two years of margin pressure have, of necessity, installed.

The carriers who exit 2027 in a stronger position than they entered 2026 will be those who used this transition period to prepare, not those who moved reactively once the environment shifted.

CTOA will continue to monitor and report on each of these files as they develop. The Gordie Howe Bridge opening, the EPA revised rule, and the CUSMA review are all active situations. Members should expect direct updates from CTOA as material developments occur.

Editorial note: This report synthesizes publicly available market data, regulatory filings, and CTOA’s direct advocacy experience. Where forward projections are cited, they represent the current consensus of industry analysts and may evolve as new information emerges, including the U.S. EPA’s forthcoming revised emissions rule expected in Q2/Q3 2026. Members should verify time-sensitive regulatory and tariff details directly with their advisors before making capital commitments.

This is not just a trucking issue, it is a national supply chain and economic security issue that requires coordinated action

Mississauga, ON (March 17) : The Canadian Truck Operators Association (CTOA) is planning to launch a national freight security initiative aimed at addressing the growing problem of cargo, trailer, and equipment theft across Canada.

Cargo theft has become an increasingly serious threat to trucking companies, freight brokers, shippers, insurers, and the broader Canadian supply chain. According to industry estimates and cargo security reports, cargo theft across North America has escalated significantly, with losses reaching approximately $725 million in 2025, representing a sharp increase from previous years.

With over 70% of Canada’s domestic freight moved by trucks, rising cargo theft is not just an industry concern, it is a growing supply chain security issue that can impact businesses, consumers, and economic stability across the country.

Canadian law enforcement and industry stakeholders have also reported increasing theft activity in key logistics regions, particularly in major freight corridors such as the Greater Toronto Area and Peel Region, where hundreds of incidents have been recorded in recent years.

Organized criminal networks are increasingly targeting high-value shipments using sophisticated tactics such as fraudulent carrier identities, fictitious pickups, and coordinated cargo theft operations. These developments reflect a growing concern that cargo theft is evolving into a more organized and systemic challenge affecting the transportation sector.

In response, CTOA has begun facilitating information sharing among its members regarding theft incidents, suspicious activities, and emerging patterns, helping carriers and drivers respond more quickly to potential threats.

Building on these efforts, CTOA is engaging with industry stakeholders, law enforcement agencies, insurers, technology providers, and government bodies as it prepares to develop a national information-sharing and coordination framework aimed at preventing cargo theft and improving recovery of stolen freight and equipment.

“Freight and trailer theft is no longer an isolated issue affecting a few companies, it is becoming a broader supply chain security challenge,” said Tej Dulat, CTOA. “CTOA has started working with our members to share information and raise awareness, and we are preparing to help lead a coordinated effort with industry partners, law enforcement, and policymakers to address this problem.”

“This is not just a trucking issue, it is a national supply chain and economic security issue that requires coordinated action,” Dulat added.

As part of the proposed initiative, CTOA is exploring several practical measures:

Improving real-time information sharing between trucking companies, brokers, insurers, and law enforcement
Developing an industry alert system to notify fleets and professional drivers of stolen freight, suspicious pickups, and emerging threats
Strengthening collaboration with federal, provincial, and municipal authorities on cargo theft investigations and enforcement
Promoting security awareness and prevention training for fleets, drivers, dispatchers, brokers, and warehouse personnel
Encouraging more consistent reporting and improved data collection related to cargo theft incidents

CTOA believes that stronger coordination between industry participants and public authorities can significantly improve both prevention and recovery efforts.

“Canada’s economy depends on a secure and reliable trucking network,” Dulat said. “By working together and sharing information more effectively, the industry and government can take meaningful steps to protect freight, strengthen supply chains, and reduce the impact of organized cargo theft.”

CTOA is committed to playing a leadership role in bringing together industry and public stakeholders to address this growing challenge and will be engaging partners in the coming weeks as it advances this initiative.

Media contact: To request comment or information from CTOA, Please email info@thectoa.ca

CTOA Industry Insight / Topic: Insurance, Safety, Policy

The Canadian Truck Operators Association (CTOA) represents trucking operators, fleet owners, brokers, and industry stakeholders across Canada. As discussions continue around rising insurance premiums in the trucking sector, it is important to examine the broader factors influencing transportation risks and insurance costs.

Recent industry conversations have highlighted accident severity and claims costs as key contributors to rising premiums. While these factors certainly play a role, the issue is far more complex and reflects significant economic, infrastructure, and transportation changes that have taken place over the past decade.

A balanced and comprehensive understanding of these factors is essential to developing policies that support both road safety and a resilient national supply chain.

Growth in Traffic and Road Congestion

Canada has experienced significant population growth and economic expansion over the past decade. As cities expand and economic activity increases, the number of vehicles on the road has also grown considerably.

Passenger vehicles, delivery vans, ride‑share vehicles, and commercial trucks have all increased. However, in many regions, road infrastructure has not expanded at the same pace.

Major freight corridors such as the Greater Toronto Area, Montreal, Vancouver, and Calgary are experiencing increasing congestion. Higher traffic density naturally increases the likelihood of road incidents for all road users, not just commercial trucks.

Understanding these broader transportation trends is important when evaluating safety risks and insurance claims across the sector.

Expanding Freight Demand and Supply Chain Growth

Over the past decade, Canada’s supply chain has undergone significant transformation. The rapid growth of e‑commerce, national distribution networks, and just‑in‑time delivery systems has increased demand for freight transportation.

Retailers, manufacturers, and logistics companies rely heavily on trucking to move goods efficiently across the country. As freight demand increases, trucks spend more time on the road and operate across increasingly complex logistics networks.

Trucking remains the backbone of Canada’s supply chain, ensuring that businesses and consumers receive essential goods every day.

Rising Equipment and Repair Costs

Another major factor influencing insurance claims is the rising cost of modern trucking equipment and repairs.

Today’s commercial trucks are significantly more advanced than they were a decade ago. They include complex electronics, safety sensors, and advanced driver‑assistance technologies. While these innovations improve safety and operational efficiency, they also increase the cost of repairs.

In addition, higher labour costs for technicians, global supply chain disruptions, and more expensive replacement parts have contributed to rising repair expenses.

As a result, even relatively minor collisions can generate significantly higher claim values than in the past.

Economic Pressures Across the Transportation Sector

The trucking industry has also experienced broader economic pressures in recent years. Rising fuel prices, higher financing costs for vehicles, inflation in parts and maintenance, and increased labour costs have all affected operating expenses.

These broader economic conditions influence the cost of claims and the financial models used within the insurance sector.

Understanding these pressures helps provide a more complete picture of the challenges faced by both trucking operators and insurers.

Road Safety Is a Shared Responsibility

Road safety is influenced by many factors across the entire transportation ecosystem. Traffic congestion, infrastructure design, driver behaviour across all vehicle types, weather conditions, and road conditions can all contribute to collisions.

For this reason, improving road safety requires a system‑wide approach that involves government, transportation planners, insurers, and industry stakeholders.

Focusing on the broader transportation environment helps ensure that policies address the root causes of safety risks rather than attributing responsibility to a single segment of the industry.

Technology and Safety Improvements

The trucking industry has made significant investments in technology to improve safety and reduce operational risks.

Many fleets are adopting tools such as:

telematics systems
dash cameras
driver monitoring technologies
advanced safety management programs

These technologies help companies better understand driving behaviour, identify safety risks early, and strengthen training programs for drivers. Over time, these investments can contribute to safer operations and improved risk management across the industry.

The Importance of Collaboration

Rising insurance costs affect the entire supply chain, including trucking companies, insurers, retailers, manufacturers, and consumers.

The Canadian Truck Operators Association (CTOA) believes that addressing these challenges requires constructive collaboration between government, insurers, and industry stakeholders.

Policy discussions should focus on:

improving transportation infrastructure
strengthening safety programs and driver training
addressing insurance fraud and cargo theft
supporting the adoption of safety technologies
ensuring transparency and stability in insurance markets

A collaborative approach will help ensure that policies support both road safety and a stable, efficient supply chain.

Key Industry Trends Influencing Insurance Costs

Several long‑term transportation trends help explain the changing insurance environment:

Vehicle growth: Canada’s total registered vehicles increased from roughly 23 million in 2013 to over 26 million in 2022 (Statistics Canada).
Urban congestion: Drivers in major freight corridors such as the Greater Toronto Area lose over 100 hours annually due to traffic congestion.
Rising truck values: A modern heavy‑duty commercial truck can now cost $200,000–$250,000, significantly higher than a decade ago.

These broader transportation trends illustrate why insurance risk and claim costs must be viewed within the context of a growing and increasingly complex transportation network. (Sources: Statistics Canada, transportation studies, and industry market data.)

Supporting a Strong and Sustainable Trucking Industry

Trucking remains essential to Canada’s economy. From food and consumer goods to industrial materials and medical supplies, most products rely on trucking at some point in their journey.

Ensuring the long‑term sustainability of the trucking sector is therefore critical for the stability of Canada’s supply chain.

By examining the full range of factors influencing insurance costs and working together across sectors, policymakers and industry leaders can develop balanced solutions that support both economic growth and safer roads for all Canadians.

Canadian Truck Operators Association (CTOA)
Supporting trucking operators and strengthening Canada’s supply chain.

30 - CTOA