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DAT: Spot rates gain as holiday freight starts to move

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The chart shows the rates for van, flatbed and reefer for August, September, October and the first week of November. (Courtesy: DAT SOLUTIONS)

PORTLAND, Ore. — Load posts on the spot truckload market closed the month of October on a high note, gaining 16% during the week ending November 3, according to DAT Solutions, which operates the industry’s largest electronic marketplace for spot truckload freight.

Sustained higher volumes during October is a sign that holiday freight is starting to move. The number of truck posts fell 8%, which helped lift load-to-truck ratios and led to an increase in rates after several weeks of declines.

National average spot rates for October included:

  • Van: $1.80 per mile, 4 cents lower than the September average
  • Flatbed: $2.17 per mile, 3 cents lower compared to September
  • Reefer: $2.11 per mile, 5 cents lower than September

Rates during the first three days of November were lower than October averages but were unchanged compared to the previous week: van, $1.79 per mile; flatbed, $2.12; and reefer, $2.09.

Van Trends

Spot van rates were higher on 59 of DAT’s Top 100 largest van lanes by volume. Two retail hubs for spot van freight — Los Angeles ($2.23 per mile, up 6 cents) and Columbus, Ohio ($2.14 per mile, up 7 cents) — paced rising markets.

Rates increased on van lanes into the Northeast, including:

  • Chicago to Buffalo, New York, $2.59 per mile, up 14 cents
  • Charlotte to Buffalo, $2.06 per mile, up 10 cents

Flatbed Trends

Spot flatbed rates dipped as volumes declined for the fifth consecutive week. The flatbed load-to-truck ratio averaged 10.8 in October, down from 14.7 in October 2018 and 37.5 in October 2017.

Christmas tree growers in North Carolina and Oregon, where six counties in the two states account for more than half of the 16 million trees harvested nationwide, are a big source of spot flatbed loads in November, but weakness from traditional sources—construction, oil and gas, machinery, agriculture—has caused the number of available loads to tumble.

Where flatbed rates were up: Houston, which averaged $2.30 per mile (down 7 cents), and other Texas markets have been hurt by a slowdown in oil and gas production and development. Key outbound lanes were lower:

  • Houston to Wichita, Kansas, $2.03 per mile, down 48 cents after a 38-cent gain the previous week
  • Houston to New Orleans, $2.37 per mile, down 28 cents

This weekly spot-rate snapshot is derived from DAT RateView, which provides real-time reports on spot market and contract rates, as well as historical rate and capacity trends. The RateView database is comprised of more than $65 billion in annualized freight payments. DAT load boards average 1.2 million load searches per business day. For more information visit dat.com/Trendlines.

 

 

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ACT Research freight forecast: TL contract rates turn lower with more to go

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This chart provided by ACT Research shows that after two years of rates favoring motor carriers, truckload rates in 2019 have generally favored the shippers. (Courtesy: ACT RESEARCH)

COLUMBUS, Ind. — ACT Research released the November installment of the ACT Freight Forecast, U.S. Rate and Volume OUTLOOK report covering the truckload, intermodal, LTL and last mile sectors and the gauge still shows the rates favoring shippers.

The ACT Freight Forecast provides three-year forecasts for volumes and contract rates for the truckload, less-than-truckload and intermodal segments of the transportation industry, and for the truckload spot market, the report forecasts the next twelve months. The Freight Forecast provides unmatched detail on the future of freight rates, helping businesses across the supply chain plan for the future with confidence.

Based on ACT’s For-Hire TL Carrier Database, TL contract rates fell to $2.28 per mile in Q3, down 2% year over year, following a 3% increase in the second quarter.

“We’re seeing evidence that a bottoming process is beginning in the truckload cycle from truck order and survey data,” said Tim Denoyer, ACT Research’s vice president and senior analyst. “It will be gradual, but we think spot rates will turn positive in mid-2020. Meanwhile, for-hire freight volume continues to be soft, pressured by ongoing private fleet capacity additions, so we don’t think we’ve seen the worst of the contract rate pressure yet.”

Denoyer cautioned carriers not to jump to the conclusion that capacity is tightening because of carrier failures.

“Those are not unusual in this business and the fact is U.S. fleets bought more new Class 8 tractors in September than any month in history,” he said. “So, capacity is not yet tightening, and build plans are still above replacement for the next six months. Rather, roughly 10k net new tractors were added to US highways in September, mainly by private fleets.”

Denoyer said freight had softened since the September 1 tariff imposition, because in part of the temporary strike at GM, and declines have broadened to every major rail category except petroleum.

“As GM ramps production back up, the major declines in fourth quarter to-date rail volumes should moderate somewhat,” he said.

ACT Research is a leading publisher of commercial vehicle truck, trailer and bus industry data, market analysis and forecasts for the North America and China markets. ACT’s analytical services are used by all major North American truck and trailer manufacturers and their suppliers, as well as banking and investment companies.

More information can be found at www.actresearch.net.

 

 

 

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FTR, ACT Research report Class 8 orders in October at 22,100 units

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Class 8 orders were the star of October, rising to an 11-month high, according to ACT Research President and Senior Analyst Kenny Vieth. (Courtesy: DAIMLER TRUCKS NORTH AMERICA)

The two companies that track and analyze the large truck market both reported North American Class 8 October orders at 22,100 units.

FTR said the order level was the highest since November of 2018, but still far below a year ago.  October 2019 order activity was the weakest performance for an October since 2016.

FTR said that while October orders were the highest this year and up 79% month over month, they were 51% lower than October 2018, signifying a subdued beginning to the traditional start of the ordering season.

FTR said the order level was boosted by a couple of big fleets placing large orders into 2020, but otherwise smaller orders were placed for the first quarter build.  Cancellations are expected to remain elevated as OEM’s shake out excess 2019 orders from the backlog. Class 8 orders for the past 12 months have totaled 192,000 units.

“Orders increased in October as expected, however, caution prevails,” said Don Ake, vice president commercial vehicles. “The trade and political turmoil are producing a highly uncertain business environment. Fleets are only ordering for their immediate needs. They are not willing to speculate much beyond the first quarter of next year. The OEMs have plenty of open capacity right now, so carriers are willing to approach 2020 a step at a time.”

Ake said orders were fair in October.

“Freight growth is flat, as the industrial sector slows and manufacturing struggles a bit. Orders are expected to stay in this range for a few months until there is more confidence in the economy and less turbulence in the trade war and political arena,” he said.

Kenny Vieth, ACT’s president and senior analysts, noted that the industry kicked off  “order season” in an encouraging fashion with preliminary order rising to a six-month high in October.

“Class 8 orders were the star of October, rising to an 11-month high,” he said. “While freight market conditions remain weak, the market is arguably benefiting from a substantive change in the “must-have” tractor spec.”

Regarding the medium duty market, Vieth said the fade that started in medium-duty orders during the summer lingered into the start of quarter four and if the preliminary order read stands as printed, October will represent a 40-month order low.

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Bendix Commercial Vehicle Systems named one of America’s safest companies for 2019

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Bendix Commercial Vehicle Systems is one of only 16 companies to earn distinction from EHS Today, honoring commitment to employee safety and health, environment management and risk control. (Courtesy: BENDIX COMMERCIAL VEHICLE SYSTEMS)

ELYRIA, Ohio — Coming off the safest year in its nearly 90-year history, Bendix Commercial Vehicle Systems has been honored with a major corporate award recognizing its pursuit of safe operations.

The company was named to EHS Today’s 2019 list of America’s Safest Companies, an annual award recognizing the safest companies in the United States. Bendix joins 15 other companies to be selected by the publication’s editors.

EHS Today, a magazine for environment, health and safety leaders, founded America’s Safest Companies in 2002. Since then, more than 250 companies have earned the distinction. At a ceremony that was part of its 2019 Safety Leadership Conference in Dallas, Texas, EHS Today presented the award to Bendix and the other 2019 honorees.

“From the operations floor to the executive suite, employees throughout the Bendix organization strive to maintain the highest possible standard of safety, a value deeply held in our company culture,” said Carlos Hungria, Bendix chief operating officer. “This is an important part of our journey to operational excellence, and we are truly honored to be named among America’s Safest Companies with our 15 fellow recipients. The award reflects our unwavering commitment to ensure the well-being of each and every individual who sets foot inside a Bendix facility.”

To be considered one of America’s Safest Companies, companies must demonstrate transformational environmental, health and safety leadership in the form of support from management and employee involvement; innovative solutions to safety challenges; injury and illness rates significantly lower than the average for their industries; comprehensive training programs; evidence that prevention of incidents is the cornerstone of the safety process; excellent communication internally and externally about the value of safety; and a way to substantiate the benefits of the safety process.

An attitude of no compromise best describes Bendix’s pursuit of safe operations, which is built around the goal of zero injuries, Hungria said. In 2018, that unified mindset helped the company achieve its safest year ever. Of Bendix’s 18 North American locations, nearly all achieved significant safety milestones, and cumulatively experienced a 30 percent reduction from 2017’s injury rate. At the heart of the results are preventive and corrective safety programs, as well as processes and rituals that empower employees to help improve safety.

Bendix has implemented mature safety processes, which continue to drive noticeable improvement in year-over-year safety results, Hungria said, adding that part of the long-term strategy of the Health, Safety and Environmental (HSE) team, these processes include a 24-hour incident notification and containment policy; Safety Shares, a practice begun in 2019 involving the sharing of a personal safety lesson at the start of each meeting; lessons learned from incident sharing across all of Bendix’s plants to identify and eliminate similar risks; among others.

In addition, engagement opportunities through the Safety STARS (Safety Top Achievement Recognition System) program enable employees to take on a key role in identifying unsafe conditions, unsafe behaviors, and safety improvements.

Key to the success of the safety program has been the integration with the Knorr Production System (KPS) quality, productivity, and continuous improvement culture. KPS is practiced worldwide throughout the Munich, Germany-based Knorr-Bremse Group, of which Bendix is a member. KPS tools and rituals have helped quantify improvement activities, increase visibility to safety losses, escalate safety concerns, and drive team-level ownership of safety.

“We’re so proud of our team members in Bendix blue who come to work every day 110 percent committed to performing their jobs safely,” said Maria Gutierrez, Bendix director of corporate responsibility and sustainability. “Their dedication made the America’s Safest Companies recognition possible. We look forward to reaching more milestones as we continue on Bendix’s safety journey.”

 

 

 

 

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