Business Archives

Averitt Express celebrates 50 Years

The Trucker News Staff - November 30, 2021

COOKEVILLE, Tenn. — Averitt Express celebrated 50 years of operation Oct. 1 with events at facilities across the country, including its corporate headquarters in Cookeville. “On Oct. 1 and dating back to National Truck Driver Appreciation Week (Sept. 12-18), the festivities at Averitt’s facilities included special ceremonies, grab-and-go meals and employee prize drawings for wireless headsets, GPS units, gift cards, televisions, iPads and more,” a company news release noted. For the grand company-wide prize, five over-the-road drivers had their names drawn to be assigned a brand-new 2022 Freightliner truck. The winners were: Crystal Austin of Hickory, North Carolina; Rey Cabigquez of Little Rock, Arkansas; Troyshawn Downey of Greensboro, North Carolina; Tim Johnson of Charlotte, North Carolina; and Rebecca Sanders of Jackson, Tennessee. In 1958, Thurman Averitt founded the company as Livingston Merchant’s Co-Op in Livingston, Tennessee. By 1969, Averitt had incorporated his company and renamed it Averitt Express. While making regular deliveries in Nashville, Averitt befriended Gary Sasser, who was a dock worker at the time. Sasser asked Averitt one day if he would be interested in selling his company. After some thought, Averitt agreed. On Oct. 1, 1971, Gary Sasser, at the age of 21, purchased Averitt Express, which consisted of two associates, three tractors and five trailers. Today, Sasser serves as Averitt’s chairman and CEO, and Averitt Express is one of the nation’s leading transportation and logistics providers. The company now employs more than 9,000 people and operates approximately 4,600 tractors, 15,000 trailers and 140 facilities across the country. “In 1971, I was just a 21-year-old kid who was going to night school, but I knew that I wanted to be in the transportation industry,” said Sasser, who also took logistics training while serving in the U.S. Marine Corps Reserve. “I was surprised when Mr. Averitt agreed to sell, and it didn’t take long to face my first challenge: How to make payroll,” Sasser recalled. “We actually sold the trucks and leased them back just so we could have some operating capital to give everyone a paycheck. We learned a lot in those early days.” One of those lessons had to do with the cost of doing business. Sasser is often asked why he never changed the company’s name from Averitt Express. “The simple answer is, it was too expensive. By the time we could afford it, the Averitt brand was well established, so there was no reason to make the change,” he explained. “From Day 1, we surrounded ourselves with good people, people who shared our vision. The industry had a reputation for not being service-minded. We wanted to change that. We sat down as a group and figured out what we could do best, where we wanted to go and how to get there,” he said. “From early on, we knew we weren’t in the trucking business; we were in the service business. Trucks were just the tool, like computers, telephones and forklifts.” Sasser believes people are the most important assets a company can have. “The two most important things we committed to from the very beginning was to focus on people and service. It’s people who deliver the freight, not trucks. And when our people provide outstanding service, customers trust us with more and more of their business, allowing us to grow. That’s what secures our future,” he concluded.

Making safety a personal value means looking out for others

Cliff Abbott - November 26, 2021

Sure, safety is a priority. You make safety a priority in everything you do. You aren’t alone. Carriers emblazon the idea across their web pages, and some even put it on their trucks. Company executives, safety managers and driver recruiters incorporate the term into speeches and selling points. But there’s a problem with having safety as a priority. It isn’t good enough. A “priority,” according to most dictionaries, is something that is important. It comes before other items on a list. So, putting safety at the top of the list is a good thing, right? Yes … and no. The problem with priorities is that they change, often due to circumstances. Take fuel, for example. When the fuel gauge registers a quarter tank, you might look for a truck stop to fill up. Perhaps you prefer a certain truck stop or chain of truck stops. Maybe you’re looking for the best price, or one with your favorite fast food. Maybe a shower — or just a clean rest room — is your motivation. When the gauge has been resting on “E” for a while, stopping for fuel moves to the top of your priority list. You may choose to stop at the first place see, even if it isn’t your favorite. When the fuel tanks are full, your next fill-up may not be a concern at all. The point? Even though safety is a priority, its ranking on the priority list isn’t locked. When you’re behind schedule, or when there’s an angry dispatcher or a distraught spouse on the phone, your mind gravitates towards solving an immediate problem. No, you aren’t likely to make a decision that says, “Forget safety, it’s not important today.” You might, however, go a little faster to make up time, or drive through a yellow light you would normally stop for. Safety often comes down to a series of small decisions. Years ago, a risk manager at Great West Insurance by the name of David McLaughlin considered the issue. He reasoned that no list of safe driving steps, techniques or keys could be effective unless the driver cared enough about safety to follow them. McLaughlin’s breakthrough safe-driving program, “Ethics and Techniques,” began by addressing why drivers should care about safety before moving into the “how” of specific steps. He advised drivers not to buy into statistics that show fewer accidents than the previous year or reduced numbers of casualties, stressing that even one death due to collisions is too many. He said safety must be a value, not a priority. That’s different from a priority because our values are deeply rooted. They are beliefs that are a part of who we are, and they aren’t easily changed. Our values can shape our priorities, but they go much deeper. We aren’t likely to compromise our values. By holding safety as a value, we can look at traffic mishaps in a different way. Instead of worrying about whose fault a collision was, we can examine ways to prevent the collision in the first place. After all, when someone loses a life, does it really matter who’s at fault? A value of safety means setting rules that guide your decisions. Instead of worrying about the importance of a text message, for example, you’ll stick with the rule of never reading text messages while driving. You’ll maintain your speed, even if you’re behind schedule. You’ll choose safety every time. But making safety a personal value goes further. Professional drivers are taught a variety of defensive driving skills. The premise, of course, is that each driver must defend themselves from all the other drivers on the road. It’s a given that accidents will occur, but we must make sure we aren’t involved, right? A key component of McLaughlin’s training is the ability to see the humanity behind the drivers. Each driver is a person — someone’s parent or child or spouse or sweetheart or friend. When we view them as bad drivers, “four wheelers” or simply “motorists,” we fail to acknowledge that each is a person. We see them as threats to defend against, rather than fellow human beings that we can help. Back in the 1960s, the National Safety Council put out public service announcements that were played on television and radio. The theme of these announcements was, “Watch out for the other guy.” The premise was that drivers could avoid accidents by being aware of the potential actions of other motorists who might, for example, fail to stop at a stop sign. “Watch out for the other guy” can have more than one meaning. It can certainly mean being prepared to defend ourselves against the driving mistakes of others. But it can also mean looking out for one another, going beyond staying out of an accident to helping the other driver stay out of one, too. Here’s one example. You’re making a left turn across a multi-lane highway. Oncoming traffic is heavy, and you have to wait for an opening. Finally, there’s a gap. It’ll be close, but you’ve already waited too long and need to get going. Besides, the oncoming traffic will surely see your huge truck in the intersection and slow down, right? How could they not? Here’s how: A husband whose reactions are slowed from fatigue reacts too late. A young mother trying to calm a crying baby in the back seat never sees your rig. A teen is answering a text. An elderly driver doesn’t see well anymore. There are a thousand reasons why they should have stopped, but…. You’ll face situations every day where your decisions will cause other drivers to make decisions. Some of those will be the wrong decisions. You can’t control their actions, but you can help avoid creating a situation where they might make a wrong decision. You can help them get home safely, too. As we approach the time of year known for giving, that’s a wonderful gift to share.

Rare family-owned Indiana moving company marks 100th year

The Associated Press - November 26, 2021

PERU, Ind. — Paul Guyer was 18 when he decided to start a moving company. It was 1921, and he had just two horses and a wagon to haul the ice and animal feed that came off the trains stopping in Peru. One hundred years later, his company still exists in Peru. It’s called Guyer the Mover, and it’s operated by two of his grandsons. Instead of two horses, the company runs 50 semis all across the U.S. and Canada. They employ 30 people and own around 100,000 square feet of warehouse and storage space in Peru, Kokomo and Warsaw. The business has hauled prototype cars produced by Delphi Electronics with technology decades ahead of its time. They’ve hauled airplanes for then-Bunker Hill Air Force Base. Now, they’re one of the few family-owned moving companies left in the Midwest and have become part of the fabric of Peru’s business community. John Guyer, who today runs the business with his cousin, Charlie, said it’s unlikely his grandpa ever imagined his one-man operation would one day celebrate a century of success. “I’m sure when my grandpa started this when he was 18 or 19, the idea of being around 100 years was never on the map,” John said. “But that’s really how it began. He just moved stuff around. Then it went from horses to trucks. One thing just led to another.” That achievement this year landed the company a Century Business Award from Gov. Eric Holcomb, who honored over 30 companies during a ceremony in June. The award recognizes each company’s longevity and service to its employees, community and the state. John said it was an honor to receive the award, but it didn’t come easy. He said that over the past 100 years, the company has gone through a multitude of economic and financial downturns that threatened to close their doors for good. But that never happened, thanks to the foresight and planning from three generations of the Guyer family, who embraced the idea of diversifying their operations and adapting to the times. Today, Guyer the Mover has its hand in a number of ventures. A big part of the business is hauling exhibitions to conventions and events in places like Las Vegas and Florida. They still do a lot home moving as well. Their warehousing space has also become fundamental to the operation, where they lease space for other businesses to house new products, such as metal or furniture. That’s a far cry from their business model 50 years ago, when one of their biggest clients was then-Grissom Air Force Base. John said that most of their income came from moving the thousands of military families on and off the base. But that all dried up when Grissom realigned as a reserve base in 1994. Rolling with the economic punches is something John said he learned early on from watching his family run the business. By 1952, his grandfather had left the company. That’s when his grandmother, Nira, took over operations until she unexpectedly died in 1971. John said it was almost unheard of at the time for a woman to run a moving company, but she was feisty enough to get the job done. Paul and Nira ended up having 10 kids — seven boys and three girls — who all helped out with the business over the years. When Nira passed away, the company went to the boys, who one by one ended up moving on to other ventures. John said his dad and two of his uncles eventually were left in charge until he and Charlie took over the reigns. He said stepping into the role was a no-brainer, except for a brief stint when he contemplated becoming a firefighter like one of his uncles. But the pull of the business was too strong to resist, John said. “The fact that my dad was in this, it just made you never really consider much else,” he said. “It’s always been in our blood. It’s what we know.” That drive and inherited business savvy is what’s kept Guyer the Mover in the same family for 100 years, making it a rarity in today’s hyper-competitive moving market. John said that in the 1970s, every moving company was family-owned, including four well-established businesses in Kokomo. But by the early ’80s, those businesses started to fold or merge with other companies, such as U-Haul and Penske, who looked to expand their national reach. He said the main reason many of those companies sold out or closed was that no one in the family wanted to take over. But that’s not been the case with Guyer the Mover. Now, at 63, John said his son is in line to take over the company when he and Charlie decide to step down, moving the business into the fourth generation of the family. But even then, John said, he’ll never really be able to step away from the company. He said it’s been his life for over 40 years, and after that long, it’s just part of his DNA. “It’s absolutely a lifestyle,” John said. “I think I’ll probably retire when I die, so I hope I don’t retire any time soon.”

The waiting game: Available trucks — both new and used — are scarce and expensive

Cliff Abbott - November 24, 2021

The long wait for delivery of a new Class 8 truck rose again in October, reaching 14.6 months if production continues at the same rate. “It’s because of the global everything shortage that is impacting the supply chain,” explained Kenny Vieth, president and senior analyst at ACT Research. “It’s semiconductors, and it’s resins and wood, and aluminum and certain steels, and the gamut of parts.” The October backlog of trucks waiting to be built reached 280,900. Under normal circumstances, truck OEMs (original equipment manufacturers) in North America should be able to produce 28,000 to 30,000 new trucks each month. In October, they produced only 19,260, according to data supplied by Vieth and ACT Research. “Eventually, the build rate will climb,” Vieth said. But no one knows when. If production returned to full capacity right now, it would still take more than nine months just to clear out the backlog. U.S. sales of new Class 8 trucks in October were 17,486, down just 0.4% from September sales of 17,565 trucks. Compared to October of 2020, sales dropped 8.1% from 19,034 sold in that month. For perspective, during the four-month period of July through October this year, U.S. truck sales totaled 70,977. During the same four months of 2020, as the economy was coming out of recession, 71,196 trucks were sold. In 2019, prior to COVID-19 and the economic problems brought by the pandemic, 101,463 trucks were sold. In October, 12,901 (73.8%) of the trucks sold were fifth-wheel equipped road tractors, with the remaining 4,585 (26.2%) destined for vocational uses such as dump, trash or concrete. When production is slowed, OEMs can often rely on inventories to fill orders. Inventories, however, are now at record low levels. Inventories also include trucks waiting for vocational modifications and trucks in transit — all of which are already spoken for, leaving few available for purchase. There’s no help from the used truck market, either. U.S. sales of used trucks were down 24% in October compared to October 2020, according to ACT’s “State of the Industry: U.S. Classes 3-8 Used Trucks.” It isn’t because potential buyers aren’t shopping; it’s because the trucks simply aren’t there to sell. If you find a used truck to purchase, be prepared for sticker shock. Used truck prices rose 5% from August to September, and another 3% in October. The average used truck sold was a whopping 67% more expensive than in October 2020. “When trucks are plentiful, potential buyers have the luxury of shopping for the truck that most closely meets their requirements,” said Steve Tam, vice president of ACT. “Conversely, when scarcity reigns, buyers are often left with limited, or perhaps no, choice.” Tam also suggested that with both demand and pricing at such high levels, some sellers may choose to remarket their used equipment themselves, selling their trucks outright instead of trading them in. Potential buyers may benefit by checking with carriers who run equipment that might fit their needs. One issue with used equipment is that breakdowns can be more likely than with a new truck. OEMs aren’t the only customers with supply chain problems. Repair facilities are also experiencing long waits for parts, if they can obtain them at all, adding to the anxiety over buying a truck. While the shortage of both new and used trucks creates a problem for potential buyers, trucks that are running are still finding freight rates at or near record levels. That’s because the supply of trucks isn’t sufficient to meet the demand, so shippers are willing to pay more to get their goods moved. In a typical economy, the trucking industry responds to higher rates by buying more trucks. Eventually, the number of available trucks exceeds the demand for them, and rates begin to fall. The industry experiences cycles of favorable and unfavorable conditions. But what happens when there aren’t enough trucks available to buy? The capacity crunch continues, and rates remain high. The “up” cycle of favorable conditions for trucking continues until truck numbers increase or freight volumes fall. October sales reported by individual OEMs were mixed, likely impacted by snags in the supply chain. While overall sales of Class 8 trucks fell by less than half a percent, sales at OEMs were more volatile. Kenworth sales, for example, fell by 21.7% in October compared to September, while Peterbilt sales rose by 18.8% for the same period. Volvo sales increased by 14.4%, while Mack sales fell 18.4%. According to data received from Wards Intelligence, Freightliner sales were the steadiest in the U.S. market. The OEM reported October sales of 6,520 Class 8 trucks, a decline of 2.7% from sales of 6,703 the prior month. Compared to October 2020, sales declined 11.1% from 6,703. Peterbilt’s 2,270 sold topped September’s 1,910 by 18.8% but was 15.9% down from last October’s 2,699 trucks sold. Kenworth sold 2,055 trucks in October, down 21.7% from September’s 2,625 and down 28.1% from last October, when the company sold 2,859 trucks. International saw a 13.3% increase in sales, from 2,080 in September to 2,356 in October. Compared to October 2020, sales dipped by 0.9% from 2,377. Volvo trucks gained 14.4% with October sales of 1,959, compared to 1,713 for September. Compared to October 2020, sales grew by a mere 16 trucks (0.8%). Mack truck sales of 1,278 trailed September sales of 1,566 by 18.4% but were still 18.7% better than the 1,077 sold in October 2020. Western Star increased sales in October by 30 trucks, selling 564 compared to 534 for a 5.6% increase. Compared to October of last year, sales increased by 16.5% from 484 sold in that month. Year-to-date U.S. market share for new, Class 8 truck is currently 38.3% for Freightliner, 14.7% Peterbilt, 14.5% Kenworth, 12.7% International, 9.1% Volvo, 8.0% Mack and 2.7% Western Star. While supply-chain issues continue, trucks aren’t likely to be any easier to find in the coming months, but conditions for making money will remain favorable for those who are running.

DHL Express invests $78M to expand in Miami

The Trucker News Staff - November 19, 2021

PLANTATION, Fla., — DHL Express plans to invest more than $78 million to renovate and expand its existing hub facility at the Miami International Airport. According to a DHL Express news release, “the improvements further strengthen the company’s connections and service capabilities, with added flights to and from Europe, Asia Pacific, South America – including Chile, Mexico and cities in the U.S.” “Our Miami hub has always been a key gateway into South and Central America and the Caribbean, and with the new investments and flights, it’s fantastic to see us even more connected to the rest of the world,” said Mike Parra, CEO of DHL Express Americas. “This is all part of our continual drive to expand and improve our infrastructure, modernize and grow our air fleets and establish new routes. The overall results are improved flexibility, reliability and service for our customers’ ever-growing international shipping needs.” The investment, which is part of a larger $360 million plan for the region to increase volume capacity in the DHL Express Americas network by nearly 30% by the end of 2022, includes a state-of-the-art equipment for a fully automated package sort system, the news release stated. Additionally, the new automation increased the facility’s sorting capacity per hour by almost double. With nearly twofold warehouse space – now 206,000 sq. ft. — and twice the load positions for conveyable packages, the space fully accommodates the increased volumes ahead of the peak season, the company said.

Consider more than compensation when picking a carrier to lease to

Cliff Abbott - November 15, 2021

If you’re thinking of buying a truck of your own, you’ve got some important decisions to make. One of the most important of those decisions is how you’ll use your truck to provide income. Many truck owners choose to lease their truck to a carrier. Leasing solves a lot of issues, but there are some things to look for before signing a lease agreement. Being an independent contractor means the carrier will perform many of the tasks you would need to do yourself as a trucking business owner. In exchange, the carrier will keep a portion of the income generated by your truck. The carrier takes care of finding and selling services to new customers, finding loads, issuing and collecting invoices, obtaining tags and permits, and more. Many also take care of safety requirements like drug and alcohol testing and record keeping, as well as maintaining driver qualification files. If you decide to hire a driver for your truck, the carrier may take care of all testing and background checks. Carriers that are large enough to pull down volume discounts for fuel, tires and maintenance services often share them with contractors who lease on. Most issues that develop between carrier and contractor can be avoided at the beginning of the relationship, before the lease agreement is signed. It’s a good idea to ask for a copy of the agreement before attending orientation with a new carrier. It takes time to read through the text and to make a list of questions to ask later. It could help to have an attorney review the agreement as well. Unfortunately, many lease agreements start with the contract being presented near the end of orientation, when time is limited and the owner is anxious to get to work. Lease agreements are often standard industry forms, with addendums included for various purposes. Compensation is often addressed in an addendum. Other addendums might address the use of communications equipment such as Omnitracs units, escrow accounts or other subjects. Read all the addendums carefully. Compensation is usually a huge motivator when signing on, but don’t be swayed by what seems to be a high rate per mile or percentage of revenue. It may look good at first, but policies and addendums can quickly tarnish the deal. For example, does the compensation amount include empty miles? Does the rate change with the dispatched miles? What miles are unpaid, and what miles are paid at a reduced rate? Accessorial charges should be clearly explained, with both the amounts paid for detention or layover events and the timetable for payment spelled out. Many carriers charge various fees for the services provided. If the carrier is providing the trailer, is there a rental fee? How are breakdowns or flat tires on the carrier’s trailer handled? Are there any “admin” fees added into the agreement? Know exactly what you’ll be paying for and the amounts you’ll pay. Carrier fuel cards can be a wonderful convenience and result in considerable savings, but they often come with fees and charges for each transaction. Some carriers charge for every use of the card, while others charge only for cash advances. Also, many carriers use networks of fuel suppliers; the card may not work, or there may be additional charges, if you fuel at a location outside of the network. Escrow accounts are often a point of conflict, especially when leaving a carrier. Many carriers require a security escrow account that is used for repayment of advances or payment of any cargo claims, collision deductibles or other costs. Cargo claims can be a particular problem if the carrier doesn’t even contest the claim, knowing it will be paid using money deducted from the driver’s escrow account. Make sure you understand how much of your money will be placed in escrow and the conditions under which the carrier can withdraw money from your account. If the carrier deducts escrow contributions from your settlement, you should know what the maximum amount per settlement will be and when deductions will stop. Some carriers demand $1,000 in escrow, while some demand much more. Another important item to consider is when you can expect to get your escrow money after leaving the carrier. The agreement should specify the requirements you must meet to get your money, such as turning in all bills of lading, receipts and other paperwork. According to the FMCSA, your escrow money must be returned within 45 days of your last day with the carrier. The law also requires you be paid interest on the money in your escrow account. Some carriers require a second escrow account to be used in the event repairs are needed or for preventive maintenance. Although it can be a burden to make contributions to the account from each settlement, it can pay off when a major repair is needed. At many carriers you’ll qualify for any discounts the carrier receives, and the money will be there when you need it. As with any escrow account, however, be sure you understand the conditions for withdrawal of funds. Some carriers, for example, will allow use of escrow funds for oil changes and other preventive maintenance, while others will release funds only for major repairs. Also, some carriers may only allow use of funds at approved facilities or for approved products. If you purchase and install a part yourself, will you be reimbursed from the fund? This is a question to ask before they have your money. One tenet of being an independent contractor is that you have the right to refuse loads. Some carriers, however, will try to dispatch your truck like a company-owned vehicle and will expect you to accept loads anywhere in their system. If you refuse a dispatch, they can’t legally cancel the lease agreement — but they can refuse to offer another load or offer only undesirable loads as “punishment” for your refusal. Talk to other contractors in the carrier system before leasing on. If refusing loads is a problem, it’s the wrong carrier for you. There’s a lot more to consider than compensation when choosing a carrier to lease to.

GrubMarket buys Oakport Transportation

The Trucker News Staff - November 12, 2021

SAN FRANCISCO — Food technology company GrubMarket has completed the purchase of Oakport Transportation, a trucking and logistics service that stores and ships produce throughout California, the Pacific Northwest, British Columbia and Nevada. Both companies are based in California. In a news release, GrubMarket said it “will leverage Oakport’s facilities and logistics networks to address the supply chain challenges introduced by recent trucking shortages, route congestion and skyrocketing consumer demand for fresh food.” The news release further stated that “The coronavirus pandemic has exposed massive vulnerabilities in the supply chain ecosystem, impacting and dislocating shipping routes, ports, warehouses and trucking lines. The shortages in key transportation and logistics resources have spiked transportation costs and ultimately consumer prices. Oakport Transportation provides critical services such as load and LTL (Less than truckload) volume delivery, refrigerated storage for perishable goods, cross docking and load consolidation.” After the acquisition, the business will continue to be managed by its current leadership team, according to the news release. “We are excited to join the GrubMarket team and welcome the opportunities brought forth by GrubMarket’s robust technology platform and network,” said Sal Rizzo, CEO of Oakport Transportation. “We are constantly striving to be the most dependable trucking and logistics partner for our customers. We are thrilled to learn that GrubMarket shares this same goal. We sincerely look forward to joining the GrubMarket team and bringing more efficient, reliable and cost-effective logistics services to GrubMarket’s suppliers and end customers.” Mike Xu, CEO of GrubMarket, described the current global logistics situation as complex and difficult due to COVID-19. He said that, together, the two companies can better tackle the issue. “This acquisition enables GrubMarket to further strengthen our producer relationships on the West Coast, expand our internal fleets and warehouse capacity and become a leader in transportation and logistics services for the underserved food producer and supplier market,” Xu said. “Together, we will overcome the disruption plaguing the current supply chain and make a greater impact on the evolution and transformation of the American food supply chain industry.” Founded in 2014, GrubMarket is a San Francisco-based company operating in the space of food supply chain eCommerce for both business customers and end consumers, as well as providing related software-as-a-service solutions to digitally transform the American food supply chain. Currently, GrubMarket operates in Arizona, California, Connecticut, Georgia, Michigan, New York, New Jersey, Missouri, Massachusetts, Oregon, Pennsylvania, Texas, Washington and British Columbia (Canada), with plans to expand to other parts of the U.S., Canada and other parts of the world.

PS Logistics expands with purchase of two fleets

The Trucker News Staff - November 12, 2021

BIRMINGHAM, Ala. — Shipping company PS Logistics has announced two major acquisitions over the past week. First, one of PS’s subsidiaries, P&S Transportation, LLC, has completed its purchase of Nauvoo, Alabama-based JLT Services, LLC’s transportation assets. Second, the company’s DMT Trucking, LLC subsidiary brokered a deal for the transportation assets of Broken Bow, Oklahoma-based Daryl Thomason Trucking. Financial terms of the two deals were not released. JLT maintains a fleet of 32 trucks, according to a PS Logistics news release. “We are proud to welcome JLT to the PS Logistics family,” said Houston Vaughn, president of PS Logistics. “JLT brings great drivers, employees and freight expertise to our company as well as a new key customer to PS Logistics. I am pleased PS Logistics will continue JLT’s family-oriented atmosphere and strong culture and we look forward to providing JLT’s customers with the same service commitment.” According to the news release, the JLT acquisition “continues PS Logistics’ acquisition strategy of partnering with families and owners within the flatbed trucking segment. Since 2014, PS Logistics has successfully acquired and integrated 23 trucking and logistics operations.” Daryl Thomason Trucking has approximately 108 trucks and 167 53-foot flatbed trailers, along with “excellent drivers and a seasoned management team leading the company,” the PS Logistics news release stated. “The transaction will further strengthen PS Logistics’ operations in the Southwest U.S. and provide it with additional terminals in Broken Bow, Oklahoma, and Nashville, Arkansas,” according to the news release. “The combination of DMT Trucking and Daryl Thomason Trucking provides PS Logistics with further inroads to the 53-foot trailer market and the ability to enhance its over-length service to existing and future customers.” Scott Smith, chief executive officer and co-founder of PS Logistics, said he is proud to welcome Daryl Thomason Trucking to the fold. “We look forward to working with their great flatbed drivers and operations group, while continuing their top-notch customer service,” he said. Daryl Thomason, president and founder of Daryl Thomason Trucking, said: “I have known the PS Logistics team for many years, and I am happy to be partnering with them. Over the last four decades, we built a successful flatbed trucking operation serving outstanding customers with dedicated employees and we will strive to continue that tradition with the same commitment to excellence.” The Daryl Thomason Trucking acquisition “continues PS Logistics’ acquisition strategy of partnering with family owned and culture driven companies within the flatbed trucking segment,” the news release stated. “Since 2014, PS Logistics has successfully acquired and integrated 22 trucking and logistics operations.” “PS Logistics has been a great partner for us at DMT Trucking and we are thrilled to welcome Daryl, Shelly and the entire Daryl Thomason Trucking family to our company,” said Harold Smith, who will manage the combined entities. “PS Logistics has been very supportive of our employees, customers and drivers and we have grown our business significantly because of that great support and partnership. We look forward to doing the same with Daryl Thomason Trucking with the continued support of PS Logistics.”

Boyle Transportation’s sale finalized

The Trucker News Staff - November 12, 2021

BALTIMORE — Canadian company Andlauer Healthcare Group (AHG) has closed its deal to purchase Boyle Transportation for approximately $80 million. According to a news release from investment banking firm Bengur Bryan, which brokered the deal, the purchase price was achieved through the issuance of 522,116 subordinated voting shares and cash of approximately $60 million. Kiowa, Oklahoma-based Boyle Transportation provides specialized transportation services to clients in the life sciences and government/defense sectors. Boyle Transportation joins AHG’s “comprehensive platform of dedicated healthcare supply chain solutions and continues to be led by the existing leadership team,” according to a news release from Bengur Bryan. “We’re proud to join the Andlauer team,” stated Andrew Boyle and Marc Boyle, co-presidents of Boyle Transportation. “As part of the highly regarded AHG platform, we are confident that this strategic move will help Boyle Transportation and AHG deliver a broader suite of services to our valuable clients and apply our expertise on a greater scale.”

FMCSA to update CDL requirements; mobile carriers plan ‘sunsetting’ of 3G networks

The Trucker News Staff - November 10, 2021

As the end of 2021 approaches and the nation prepares to face a new year, there are two major changes on the horizon that impact the trucking industry. In February 2022, the Federal Motor Carriers Safety Administration (FMCSA) will update its entry-level driver training rules. At the same time, mobile carriers plan to begin sunsetting their 3G data networks. In addition to cellphones, this change will impact electronic logging devices (ELDs) and many other mobile devices. LICENSING AND TRAINING CHANGES The Entry-Level Driver Training (ELDT) rule, which will be implemented Feb. 7, 2022, establishes new minimum training requirements for people who want to obtain a commercial driver’s license (CDL), upgrade a CDL or obtain a passenger, school bus or hazardous materials endorsement, according to the FMCSA. Under these new requirements, an entry-level driver must successfully complete a prescribed program of theory and behind-the-wheel instruction. Before taking the knowledge test or the state-administered CDL skills or hazmat endorsement tests, training must be provided by an entity listed on FMCSA’s Training Provider Registry. In addition, the minimum standards and requirements for CDL schools will be set at a federal level, as opposed to being set by each state. CDL schools must record and report hours behind the wheel (no federal minimum) to the U.S. Department of Transportation (DOT). Schools must register and self-certify, and they can self-certify instructors. Individual instructors may have to register with the DOT, depending on the state. Driving instructors will be required to have a minimum of two years driving experience, a clean motor vehicle record and a medical certification to be eligible to teach driving students in the classroom, on the road and private range instruction. There will also be an increase in curriculum mandates. DOT requires 31 theory course topics instead of the original four knowledge topics, which will be accompanied by 19 mandated behind-the-wheel skills, that will be tested with vehicle inspection skills at the state department of motor vehicles. CDL schools must apply to join the new Training Provider Registry. More information about the requirements is available at tpr.fmcsa.dot.gov. 3G NETWORK SUNSET Mobile carriers are shutting down their 3G networks to make room for more advanced network services, including 5G. As a result, many older cellphones and other mobile devices will be unable to use data services, according to the FMCSA. “Once a 3G network is no longer supported, it is highly unlikely that any ELDs that rely on that network will be able to meet the minimum requirements established by the Electronic Logging Device Technical Specifications, including recording all required data elements and transferring ELD output files,” FMCSA officials said. Any ELD that requires 3G cellular connectivity to perform its functionality will no longer be in compliance with the technical specifications in the ELD rule once the 3G network it relies on is sunsetted. When in an area that does not support 3G, a 3G device will register a malfunction. The carrier has eight days to get the malfunction resolved, in this case by replacement, unless an extension is granted, the FMCSA news release stated. The announced sunset dates are listed below. These are dates for completing the shutdowns. Mobile carriers are planning to retire parts of their networks sooner. AT&T 3G: Feb. 22, 2022 Sprint 3G (T-Mobile): March 31, 2022 Sprint LTE (T-Mobile): June 30, 2022 T-Mobile 3G: July 1, 2022 Verizon 3G: Dec. 31, 2022 Many other carriers, such as Cricket, Boost, Straight Talk and several Lifeline mobile service providers, utilize the AT&T, Verizon and T-Mobile networks.

Weathering the storm: September freight rates stayed high as capacity remained constrained

Cliff Abbott - November 10, 2021

When a month starts off, as September did, with one of the most damaging hurricanes in U.S. history, both freight levels and fuel prices are impacted. When hurricane Ida made landfall as a Category 4 hurricane near Port Fourchon, Louisiana, Aug. 29, its eye narrowly missed New Orleans as it destroyed thousands of homes and left huge areas of the state without power. But Ida wasn’t finished. The storm lingered, dumping massive amounts of rain as it crept from the Gulf Coast to the Northeastern U.S. before finally drifting off into the Atlantic Ocean Sept. 2. Ida spawned flash floods and tornadoes that caused at least 95 deaths — and billions of dollars in destruction. Shipping was disrupted along the entire path of the storm, and nine refineries reduced production or shut down. According to the U.S. Energy Information Administration (EIA), refinery production was reduced by an average of 713,000 barrels per day for the entire month. Over the next two months the national average diesel fuel price rose more than 40 cents per gallon. Through it all, demand for truck capacity remained strong as both freight volumes and revenues increased, according to the ACT Research For-Hire Trucking Index. Using polling data received from trucking service providers, ACT compiles the index using 50 as an indicator of flat activity — above 50 means volumes are expanding, while lower means they’re contracting. Freight volumes have been expanding for 16 consecutive months, according to the index. The rate, however, is slowing. “Although it increased in September, the volume index is still considerably below the 65.5 average of the past 12 months,” said Tim Denoyer, ACT vice president and senior analyst, in an October 21 release. Denoyer blamed supply bottlenecks for a result that could have been even better. “In particular, chip and part shortages are hindering vehicle production,” he claimed. That’s a situation that hits the industry in multiple ways. If the industry could get its hands on more trucks, more freight could be moved. And vehicles, including parts and components needed to build them, make up a large portion of freight moved. Denoyer also mentioned that vaccine mandates (or the threat of them) may be exacerbating the driver shortage by discouraging qualified drivers who are against the mandate from applying. The American Trucking Associations (ATA) reported a 2.4% increase in its Truck Tonnage Index following a smaller gain of 0.3% in August. “September’s sequential gain was the largest in 2021,” said Bob Costello, ATA chief economist. “It is good that tonnage rose in September, but it is important to note that this is happening because each truck is hauling more, not from an increase in the amount of equipment operated as contract carriers in the for-hire truckload market continue to shrink from the lack of new trucks and drivers.” Compared with September 2020, the ATA index rose 1.7%, representing the first year-over-year increase since May. For the year to date, tonnage is unchanged. That’s interesting, because 2020 saw a huge decrease in freight levels in March, April and May due to COVID-19 shutdowns before recovering later in the year. For 2021, there hasn’t been such a decline and rebound. No matter, at the end of nine months of 2021 freight levels are right where they were a year ago. It’s important to point out that the ATA index represents mostly contract freight. Interestingly, the backup of ships waiting to unload at West Coast ports may be contributing to the shipment numbers. Chassis, both rail and truck, are hard to come by. One reason is the difficulty in getting steel to build them. India, the world’s second-largest steel producer, still hasn’t resumed full production after diverting oxygen supplies to hospitals for COVID-19 patients. China, penalized for dumping steel on world markets, added the 200% penalty to their prices. The truck chassis that are available are often stuck at trucking carriers’ parking lots, waiting for the port to accept the return when space is available. With cargo containers stacked everywhere, the ports required carriers to make appointments to return chassis, sometimes making them wait a week or more. All the port issues have resulted the use of alternate methods for moving freight. For example, the lack of a rail chassis for a container might result in that container being taken to a local warehouse instead of making a 1,500-mile rail trip from the port to a railyard near its destination. The cargo would be unloaded from the container and then loaded into a standard dry van or refrigerated trailer for its journey to the receiver. This practice does several things to shipping data. First, it adds to the amount of freight trucking is hauling. Capacity is reduced, since that trailer is removed from the pool of trailers to haul loads, driving spot freight rates higher. According to Truckstop.com, the week ending Oct. 1 showed spot load postings were still increasing. The organization credited supply chain disruptions for keeping volume stronger than expected for the season. Truckstop.com reported load postings were much higher than normal, with four days of the week over one million loads posted as compared to a normal load volume of 400,000 per day. Rates for the week stayed even at an average of $2.95 per mile. It marked the 55th consecutive week that average rates topped $2.40 per mile. The five-year average for rates on the website is $2.10 per mile. The Bloomberg/Truckstop.com survey for the third quarter, released Nov. 3, showed more than half of surveyed drivers (55%) expect spot rates to rise further in the next six months. Many (67%) respondents said they expect the freight market to remain tight for the rest of the year, while 74% indicated they expect spot rates will remain steady or even rise in 2022. For the trucking industry, equipment may be hard to come by, but enough freight is available to keep trucks full and rates high for the foreseeable future.

Ley receives WIT’s influential woman award

The Trucker News Staff - November 9, 2021

DALLAS — Lily Ley has been given the Influential Woman in Trucking award by the Women In Trucking Association (WIT) and Freightliner Trucks. Ley, who won the 11th annual award Tuesday during the WIT Accelerate! Conference & Expo in Dallas, serves as vice president and chief information officer at PACCAR. The announcement came after the panel discussion “Inspiring Stories: How to Power Your Career,” according to a WIT news release. The panel included all of the finalists for the 2021 Influential Woman in Trucking award and was facilitated by Elizabeth McManis, manager of brand marketing at Daimler Trucks North America. “The Influential Woman in Trucking award recognizes women in the trucking industry who make or influence key decisions, have a proven record of responsibility, and mentor and serve as a role model to other women,” the news release stated. “The award was developed in 2010 to honor female leaders in trucking and to attract and advance women within the industry.” Finalists for the 2021 Influential Woman in Trucking award also included Eileen Dabrowski, Director of Learning, Development and Marketing, ReedTMS Logistics and Amanda Schuier, Chief Operating Officer, Quality Transport Company. “After our conference in 2020 was virtual, it was refreshing to host the event live and listen to these outstanding finalists share their inspirational stories with the audience,” said Ellen Voie, WIT president and CEO. “This award is WIT’s way of highlighting Lily, Eileen and Amanda for their commitment and service to the industry.” “Ley is an experienced Technology and IT executive, mentor to aspiring students, and passionate advocate for more inclusive workplaces for women,” the news release stated. “In her role as vice president and CIO for PACCAR, a global automotive truck and engine company, Ley leads the Information Technology (IT) division and the modernization of IT for the digital age. She brings a customer-first mindset, a focus on applying innovation to deliver tangible business benefits, and a relentless pursuit of enhanced business efficiencies.” Ley is a member of the MSIS Board of Advisors at the University of Washington. She is also the executive sponsor for the PACCAR Women’s Association (PWA), where she advocates for inclusion of women in the workplace. She is involved in Seattle CIO as an advisory board member, and in 2016, the Washington Diversity Council recognized her as “2016 Washington Most Powerful and Influential Women.” Ley earned a Bachelor of Science in computer science and an MBA from CETYS University and has also completed the executive development program at Stanford. She enjoys spending time with her husband German and two daughters and is passionate about travel and cooking.

Shell Oil Company buys Fuel Card

The Trucker News Staff - November 8, 2021

HOUSTON — Shell Oil Company has acquired MSTS Payments, LLC and its Multi Service Fuel Card business from Multi Service Technology Solutions, Inc. The Multi Service Fuel Card acceptance network and transaction processing platform provides Shell with a closed-loop payment network used by Commercial Road Transport (CRT) companies at thousands of truck stops in North America, according to a news release. Closed loop payments allow consumers to pre-load funds into a spending account that is linked to the payment devices. “Acquiring the Multi Service Fuel Card business provides Shell with the necessary technology, business infrastructure and talent to accelerate the growth of its global commercial cards business, Customer Value Propositions (CVPs) and services,” said Tim Murray, General Manager of Shell Commercial Road Transport, Sectors & Decarbonization. “We are confident that this strong IT platform and acceptance network will help us deliver a customer experience that will translate to additional growth for Shell’s North America Commercial Road Transport businesses.” MSTS Payments, LLC will operate as a wholly owned subsidiary of Shell Oil Company and will remain homebased in Overland Park, Kan. Aaron Decker, who led the Multi Service Fuel Card business for Multi Service Technology Solutions, will continue to do so as part of the MSTS Payments management team. “We’re very excited about the opportunity provided by Shell to help the fuel card business realize its full potential,” Decker said. “We’re equally excited to help Shell grow its Commercial Road Transport business.” The investment in the Multi Service Fuel Card business includes growing market share in the fuel card space and creating synergies with Shell product offerings. Shell plans to add services to enhance the customer experience and leverage its heavy duty diesel engine oil brand, Shell Rotella®, to offer trucking fleets fuel-economy savings, extended-drain capability, enhanced engine cleanliness, and excellent wear protection.

Follow good safety practices to avoid injury while loading or unloading a trailer

Cliff Abbott - November 4, 2021

Safety is important for every driver. Most learn early in their CDL careers how to stay safe on the road, and many receive periodic training from the carrier they drive for. While training for safety when driving is widely available, there is another part of the job where safety training is often neglected: Dangers exist in, on and around the trailer while it is being loaded or unloaded. If you pull a van or refrigerated trailer, the area directly behind the trailer is a common place for accident and injury. Flatbed and curtainside trailers are often surrounded by moving forklifts or other equipment and sometimes carry heavy items that can fall. Securing and tarping loads often requires climbing on and around freight that can shift or roll. Tank trailers often require climbing on top, and present dangers of their own. Many tanker facilities are equipped with safety harnesses in case of a fall. Use them. For a van trailer, it seems simple. Remove the seal and/or lock, lift the latch and swing it out, and get those doors open so you can back into the dock. Unfortunately, as too many drivers have learned the hard way, this simple operation isn’t always a safe one. Cargo that has shifted in transit can force the doors to open quickly, or the load can even fall on an unsuspecting driver. Moreover, trailers that are assigned to trailer pools at customer locations may not receive regular maintenance attention as they are shuttled from one customer lot to another. Issues with door hardware such as hinges and latches may not have been reported by drivers who used the trailer previously. There are techniques for opening the doors safely. Following them isn’t a guarantee that nothing will happen — but it does reduce the risk of getting hurt. Before approaching the doors at all, an inspection is in order. Check the ground surface behind the trailer. There may be potholes or, in the case of gravel lots or yards, uneven surfaces. Even if the surface is smooth and level, look for loose sand or dirt that could impact traction. Caution is required on ice and snow, too. Next, check the back of the trailer. Look at the hinges: Check for cracks or breaks. Also watch for doors that aren’t “square” to the trailer body. Doors are heavy, and a broken hinge can result in the door falling (or at least opening in an unexpected way). Once you decide it’s safe to open the doors, make it a habit never to stand directly in the path of the one you are opening. While you open one door, stand behind the other, still-secured door. Then, as the door opens, check carefully for any boxes or containers leaning against the door being opened. They will likely fall as the door opens, so make sure you aren’t standing where they’ll land on you. If you’re standing behind the other, still latched door, you’ll have a barrier between you and the falling items. Have a firm grip on the door, especially if it’s windy. Doors have a lot of surface area for the wind to catch and can open suddenly and violently if they get loose. Drivers have been killed after being struck in the head by doors that swung open quickly. If freight does fall, think twice about trying to catch it. Instinctively, you may try to prevent damage, but items falling from higher up gain momentum on the way down. Even lightweight boxes can cause injury if the corner strikes first. Once the door is open, secure it so it stays that way while you back into the dock. Most doors are equipped with a length of chain or a T-shaped bar that attaches to a provided hook, but these devices can come loose while backing because of uneven terrain, wind and other factors. This can damage the doors and other vehicles on either side, as well as pedestrians who might be close by. It’s a good idea to add a bungee cord to help keep the chain in place so the door stays secure. That little extra effort can help prevent an expensive incident. With one door open, it’s easier to check for freight leaning against the other door and make adjustments if boxes are light enough to handle. If heavy objects such as large rolls of paper are leaning against the door, get help before trying to move the freight. Drivers hauling trailers with roll-up doors aren’t immune to injury, either. Roll-up doors have more hinges and other mechanical parts — like cables, tracks and rollers — that can deteriorate over time, causing the door to close suddenly. It’s worth an inspection, before loading if possible. Check both sides of the door for missing nuts or bolts, broken hinges or any other part that looks suspicious. For flatbed and other open-deck trailers, it pays to be vigilant while loading and unloading. Drivers have been injured by forklifts, cranes and other loading equipment. When straps or chains are removed, freight can shift suddenly, falling off the trailer onto an unsuspecting driver. This is especially true of rounded items, such as pipes or logs. Injuries have also happened as drivers attempt to “help” a forklift operator by holding back curtains or tarps, or attempting to keep freight from moving while an equipment operator gets positioned. Never place yourself between the trailer and the unloading equipment. If you must assist, watch carefully for freight movement and be prepared to escape if something moves. Every trailer type has its own pitfalls when it comes to loading and unloading. The best practice is for the driver to be someplace else, away from any danger. Unfortunately, that isn’t always possible. The risk of injuries around the trailer may not seem as high as in a highway accident, but pain, disability and death are still possible. You can reduce your chances of getting hurt by being as safety-conscious around the trailer as you are in the cab of the tractor.

Backlogs continue: Truck manufacturers still plagued by shortages of semiconductors, other parts

Cliff Abbott - November 3, 2021

Production of new Class 8 trucks is still constrained by a lack of parts, inventories are all but gone, and used truck prices are so high that they aren’t helping. That’s the U.S. Class 8 truck market in a nutshell. Perhaps a better picture of the market is this: There were 27,300 new trucks ordered in September, compared to 17,565 actually sold. The North American backlog of orders now stands at 279,000 trucks waiting to be built. If you ordered a new truck today, it wouldn’t even be built until mid-November of 2022. “If you want a nice comparison, a year ago, September the backlog was 100,200 units,” said Kenny Vieth, president and senior analyst at ACT Research. Thinking of buying a truck off the dealer’s lot? Good luck with that, according to Vieth. “What Class 8 inventory there is out there today is what I would call ‘process inventory,’” he explained. “It’s in transit, or it’s at a body builder, or it’s in prep, or something like that. It’s already got a customer name assigned to it.” In other words, the trucks on the lot are not for sale. Used truck prices, according to ACT’s August “State of the Industry, U.S. Classes 3-8 Used Trucks” report, were 33% higher this year than at the same point in 2020. At the same time, the average used truck is older and has more miles on the odometer. Inventory is the culprit. It’s all caused by demand. Freight rates are still at or near record levels, in part because of a lack of available trucks to haul all of the freight being offered. It’s a seller’s market, and carriers are taking advantage of the opportunity to claim higher freight rates. Spot rates remain high for most lanes, too. It’s a time for the trucking industry to make money. J.B. Hunt Transport Services Inc., for example, reported third-quarter operating revenue of $3.14 billion, a 27% increase over the same quarter of 2020. Similar stories are found across the industry. When rates are high and freight is plentiful, buyers want more trucks so they can take advantage of the favorable market. Getting those trucks is a problem, especially for those who already have orders in. “I have to go back more than 10 years to find a lower inventory number for U.S. Class 8 (trucks). Sales is struggling because production is struggling and there’s basically no stock units for sale right now,” Vieth said. Parts shortages are to blame for most of the lag in production. Semiconductors are likely the biggest culprit, but steel, aluminum, plastics, foam and other needed components are also hard to come by. The semiconductor shortage isn’t getting better any time soon. According to a Sept. 29 blog post by Kelly Blue Book, the chip shortage will last into 2023. In the blog, Rohm Company CEO Isao Masumoto was quoted as saying, “All of our production facilities have been running at their full capacity since September last year, but orders from customers are overwhelming. I don’t think we can fulfill all the backlog of orders next year.” Rohm, located in Japan, is one of the largest suppliers of semiconductors for the automotive industry. Attempts have been made to jump-start an increase in U.S. semiconductor production with an infusion of federal cash. The $52 billion “CHIPS (Creating Helpful Incentives for Producing Semiconductors) for America Act” died without action in the 2020 Congress. It was reintroduced in the 2021 Congress and passed the Senate in July, but it remains in limbo as Democrats and Republicans squabble over various funding bills. A statement on the Semiconductor Industry Association website in support of such legislation read: “The share of global semiconductor manufacturing capacity in the U.S. has eroded from 37% in 1990 to 12% today, mostly because other countries’ governments have invested ambitiously in chip manufacturing incentives and the U.S. government has not.” Even if legislation passes, however, it won’t impact the production of semiconductors for months. To these issues, add record numbers of cargo ships waiting to get unloaded because of labor shortages at U.S. ports. Any of the hundreds of thousands of delayed shipping containers could contain a shipment of desperately needed semiconductors. If the semiconductor shortage isn’t enough, there’s another potential problem: China has been making noise about taking over Taiwan, claiming the independent island nation is actually a part of the People’s Republic of China. A majority of the world’s semiconductors are made in Taiwan, and any military action could hamper the world supply of chips even further. Shortages may help explain the differences in sales reported by OEMs. While the total number of trucks sold in September declined by 5.1% from August sales, according to ACT data, individual builder reports were all over the map. Sales at one company, Volvo, increased by 43.6% while sales at another, International, declined by 27.5%, according to information received from Wards Intelligence. International and Peterbilt saw the largest production drops in September, while International sales fell to 2,080, a decline of 787 trucks from August sales of 2,867. Compared to September 2020, sales declined 7.8%. Peterbilt sales of 1,910 marked the worst September for the OEM since 2013 and a 26.7% decline from August sales of 2,605 trucks. Compared to September 2020, Pete sales declined by 28.9% Freightliner sales of 6,703 Class 8 trucks were 0.9% ahead of August’s 6,646 but 13.1% behind September 2020 sales of 7,713. Volvo followed a disappointing August that saw sales of just 1,193, with a strong rebound to 1,713 trucks sold in September for a 43.6% increase. That number was still 12.6% lower than September 2020, with sales of 1,960. Volvo Truck sibling Mack Truck topped August sales of 1,495 by moving 1,566 units in September, a 4.7% increase. The result topped September 2020 sales of 1,319 by 18.7% Kenworth saw an 8.2% decline in sales from August to September, with 2,625 sold versus 2,861 the prior month. Compared to September 2020, sales declined by 6.3%, from 2,800 to 2,2,625. Western Star reported sales of 534 trucks, an improvement of 4.9% over August and 36.6% over September 2020 results. Expect the new Class 8 market to remain tumultuous as orders continue to outstrip production capacity and monthly production levels continue to be influenced by the availability of parts.

Maersk reports 68% rise in revenue amid global shipping concerns

The Associated Press - November 3, 2021

COPENHAGEN — The world’s biggest shipping company, Denmark’s A.P. Moeller-Maersk, reported Tuesday a sharp rise in earnings amid strong worldwide demand for shipments of goods as the economy bounces back from the coronavirus pandemic. The Copenhagen-based company said revenue grew nearly 68% in the third quarter, to a record-high $16.6 billion, up from $9.9 billion in the same three-month period last year. It reported profits of $5.5 billion, up from $947 million in the same period last year. “In the ongoing exceptional market situation, with high demand in the U.S. and global disruptions to the supply chains, we continued to increase capacity and expand our offerings to keep cargo moving for our customers,” CEO Soren Skou said. The urgent need for more shipping capacity comes amid soaring consumer demand for everything from cars to furniture and labor shortages in the rebounding economy, leading to major backups at ports and higher prices. The supply chain issues have caused a shortage of key equipment: shipping containers. In a statement, Maersk said its key ocean business is now “expected to grow below the global container demand” amid uncertainty around the supply chain logjams. The company also announced its intention to acquire Senator International, a global freight forwarding company with strong air freight offerings. And to expand its own air network, Maersk is adding aircraft to its operations: three leased cargo planes to be operational from 2022 and two Boeing aircraft to be deployed by 2024.

Weakest links: Bundle of problems creates major snags in the global supply chain

Linda Garner-Bunch - November 1, 2021

The supply chain — the pipeline that delivers everything from the latest Lego sets to iPads and microchips — has been choked in recent months. The reason? Pick one — the COVID-19 pandemic, warehouse worker shortages, a surge in consumer spending, or a shortage of truck drivers. That last one, a truck driver shortage, may be the toughest of all to analyze. It can also lead to heated debate among many trucking industry leaders. At the Owner-Operator Independent Drivers Association (OOIDA), the words “shortage” and “drivers” don’t mix well at all. “Let’s be clear, the current supply chain crisis is not due to a shortage of truck drivers!” OOIDA’s president, Todd Spencer, wrote emphatically in an e-mailed statement on the issue. “Because the real bottlenecks in the supply chain occur at pickup and delivery points, adding more trucks and drivers will simply makes the lines longer, NOT faster.” On the counter argument, Chris Spear, president and CEO of the American Trucking Associations (ATA), told CNN in a recent interview the trucking industry is short 80,000 drivers. That’s a 30% increase from before the pandemic, when the industry already faced a labor shortage of 61,500 drivers,” Spear said. Spencer said the global supply shortage has forced some truckers off the road, and that drivers are “experiencing the domino effects of supply and staffing shortages, which are preventing them from complying with federal regulations. Examples include drug and alcohol testing delays and difficulties finding replacement electronic logging devices, DEF filters, and CPAP machines. We encourage the U.S. Department of Transportation and other agencies to begin making some emergency allowances to keep safe, qualified drivers in business.” Spencer went on to say that truckers have been working “tirelessly to keep the country safe and productive throughout the COVID-19 pandemic. They have already been operating around the clock but are often restricted by factors beyond their control such as excessive detention time and the lack of readily available, safe parking for their trucks. “These problems must finally be addressed if the (Biden) administration hopes to implement any significant supply chain solutions,” he continued. “Most of what we are seeing is not a surprise to our members, who have been plagued with dysfunction in the supply chain for decades. It’s not realistic to expect the supply chain will suddenly operate efficiently on a 24/7 schedule when drivers aren’t being fully paid for their time.” Even though there are supply chain issues surrounding many tangible goods, Americans continued to spend at a solid clip in September. Retail sales rose a seasonally adjusted 0.7% in September from the month before, the U.S. Commerce Department said. That was a stronger showing than expected. Yet there are lingering concerns as to how resilient shoppers will be if prices continue to head north and shortages lead to frustration as the nation heads into the crucial holiday season. Consumer spending drives about 70% of all U.S. economic activity, and a sustained recovery from a pandemic-induced recession will require their participation. There is no evidence that Americans are pulling back, however, and spending last month was heavy everywhere, from clothing, sporting goods and toy stores to car lots. Economists have forecast at least a 7% increase in holiday sales, but the pandemic has made predictions more difficult. Steady sales rates that have been witnessed in clothing, tech or other goods are not assured due to worker shortages and festering supply chain issues. The global supply chain is so scrambled, many producers are leaving the bulk of their goods in China as they wait for shipping costs to retreat. In addition, hiring has slowed in the past two months, even as employers post a near-record number of open jobs. About 3 million people who lost jobs and stopped looking for work since the pandemic have yet to resume job searches, according to recent economic data. “The main concern now is that supply chain disruptions and microchip shortages appear to be spreading, limiting selection and tamping down goods demand,” wrote Sal Guatieri, senior economist and director at BMO Capital Markets, in a report published in mid-October. “Meantime, services demand is getting held back by labor shortages, notably in restaurants. Demand isn’t the problem, supply is. “ President Joe Biden told Americans recently his administration is confident that inflation is under control and announced a deal to expand operations at the Port of Los Angeles to help address supply issues. The will to spend on those goods is there, as evidenced in September; however the month also had the weakest sales growth since March, Saunders said. Momentum will not continue indefinitely; rather it will continue to trend down until it reaches more normalized levels, he said. Back to trucking, Long Beach, California-based Danlerie Freight addressed the supply chain issue in a post to the U.S. Department of Transportation’s (DOT) website after DOT officials asked trucking companies and drivers for input on the issue. Danlerie’s statement described the many steps involved in loading and offloading shipping containers to big rigs. Those steps, the company says, lead to bigger delays. “The ports have instituted an appointment requirement at all ocean container terminals,” the Danlerie’s statement reads. “Once (a) container is empty at the customer, you must first find a terminal that will accept the empty container based on the size, ocean carrier and chassis type … if you can meet all of the requirements, you must check to see if an appointment is available at the terminal to return that empty; if none are available, then you must take (the) empty container to your truck yard, where it sits until you can make an appointment.” David Owen, president of the National Association of Small Trucking Companies, also responded to the DOT survey. In a lengthy document, Owen said the DOT could further examine split sleeper-berth regulations and the 14-hour driving window as ways to improve the flow of goods throughout the nation. “We believe this would empower individual commercial drivers to respond to fatigue, detention at shippers’ facilities, drowsiness, road and weather circumstances, and other contingencies they face that typically vary each day in a more appropriate manner for individual situations,” Owen wrote. “Gathering additional data on the proposed 6/4 and 5/5 splits would be invaluable for examining real-world effects of a broader array of split sleeper berth rest,” he continued. “We believe allowing truckers additional options for sleeper-berth time-splitting would contribute to improving the efficiency, safety and reliability of moving goods.” Regardless of the mix of opinions, it would seem that almost everyone involved in supply chain industries agree that the problem won’t be fixed overnight. It could be well into next year before things begin flowing smoothly again. The Associated Press contributed to this report.

Old Dominion sees big profits in Q3

The Trucker News Staff - October 29, 2021

THOMASVILLE, N.C. — Old Dominion Freight Line, Inc. has announced record profits for the third quarter of 2021. The company’s revenue growth of 32.3% included a 15.7% increase in less-then-truckload (LTL) revenue per hundredweight and a 13.7% increase in LTL tons, according to a news release. Greg C. Gantt, Old Dominion’s president and CEO, said that the increase in quarterly revenue “reflects the strength of the domestic economy and unprecedented demand for our best-in-class service. Our superior service offering and available network capacity are fundamental qualities that differentiate Old Dominion in the marketplace and support our ongoing ability to win market share.” The increase in LTL tons was the result of a 19.4% increase in LTL shipments that was partially offset by a 4.8% decrease in LTL weight per shipment, the news release said. The decrease in weight per shipment was primarily due to our continuing efforts to reduce the number of heavy-weighted shipments in our network to preserve capacity and improve our operating efficiency. “These efforts, as well as the 0.8% increase in average length of haul, also had the effect of increasing our reported yield metrics,” Gantt said. “The 10.1% increase in LTL revenue per hundredweight, excluding fuel surcharges, reflects the changes in the mix of our freight as well as the success of our long-term pricing strategy that focuses on individual account profitability.” Gantt further stated that Old Dominion’s operating ratio “improved to a company record of 72.6% for the third quarter of 2021. We improved many of our cost categories as a percent of revenue during the quarter due to the leverage created by our balanced revenue growth as well as improvements in our operating efficiency.” Gantt added: “Our operating supplies and expenses, however, increased as a percent of revenue due primarily to the significant increase in fuel prices. We also increased our use of purchased transportation during the third quarter to supplement the capacity of our workforce. The average number of full-time employees increased 20.9% as compared to the third quarter of 2020, and we intend to continue hiring additional employees during the fourth quarter to support our volume growth and reduce our reliance on purchased transportation.”

XTL Group purchases Georgia-based CBT Inc.

The Trucker News Staff - October 29, 2021

TORONTO – The Canada-based XTL Group (XTL) has acquired CBT Inc. (CBT), a logistics company based in Oakwood, Georgia, for an undisclosed sum. According to an XTL news release, CBT was founded in 1989 by Connie Banks and is located in the Gainesville/Hall Country area of Georgia that’s known as the “Poultry Capital of the World.” “Over the past 32 years, CBT has built an extensive transportation network around major food processors, food service providers and the grocery/retail industry that is abundant in this region,” the news release stated. “Refrigerated and frozen transportation service is a key part of their customer network. CBT has been recognized for many years as a certified woman-owned, family business, and Connie will continue to be an integral part of both CBT and XTL’s mutual success.” This acquisition is the second of its kind in XTL’s history, the first taking place in February with the purchase of Transport Savoie, a refrigerated, x-border carrier now operating as Savoie Express Inc. “After many years servicing the domestic refrigerated market, we expanded into the x-border refrigerated market in 2018. Since then, we recognized the opportunity to advance our organic growth strategy with strategic acquisitions that further enhance our geographical footprint in North America.” said Serge Gagnon, president and CEO at XTL. “We knew we had the right fit when we met the exceptional team of dedicated professionals at CBT who embody our core values.” CBT will bring additional assets to XTL’s logistics offerings, including US domestic dry van, flat bed, heavy haul, over-sized, specialized and hazmat services, according to the news release. The location of northeast Georgia also allows for XTL to increase their presence in the United States, opening up opportunities between Canada and Mexico and accessing U.S. capacity, the news release stated. “Serge Gagnon and his committed team of leaders at XTL complement the similar characteristics that CBT has built its reputation on,” said Connie Banks, founder and CEO of CBT. “Together with my experienced team of employees we have brought to realization a dream I started 32 years ago and we are proud to have been chosen as XTL’s first US transportation partner. We are excited about the future growth and fresh ideas available to us.”

Hub Group buys Choptank Transport

The Trucker News Staff - October 28, 2021

OAK BROOK, Ill. — Hub Group has acquired Choptank Transport, Inc., expanding its brokerage business to more than $1 billion of revenue. According to a news release, the acquisition “bolsters Hub Group’s presence in the refrigerated transportation space and adds a complementary offering to serve its customers’ multimodal transportation and logistics needs. The addition of Choptank is an important strategic milestone toward achieving Hub Group’s goal of over $6 billion of revenue by 2025.” Hub Group Chairman and CEO David Yeager said of the acquisition: “We are excited to welcome Choptank’s employees, customers and carriers to Hub Group. This acquisition delivers on our strategy to provide the industry’s premier supply chain solutions and will advance our position in the growing cold-chain segment.” The news release stated that the acquisition enhances Hub’s over-the-road refrigerated transportation solutions offering and complements its growing fleet of 450 refrigerated intermodal containers. Hub Group intends to further invest in its refrigerated transportation offering by purchasing 550 refrigerated intermodal containers in 2022, bringing the size of its fleet to 1,000, according to the news release. “Choptank adds scale to Hub’s brokerage service line, with combined revenue of over $1 billion across dry van, refrigerated and LTL freight expected for 2021,” the news release stated. “The acquisition is expected to result in numerous complementary cross-selling opportunities for both Hub’s and Choptank’s customer bases. With this transaction, Hub’s non-asset business lines will contribute over 40% of total revenue.” In addition to its carrier network, Choptank’s 400 employees will join Hub Group. “Our team is excited to join Hub Group,” said Choptank CEO Geoff Turner. “We share similar values of service, integrity and innovation, which we are excited to bring together to fuel our continued growth. Choptank brings our wealth of industry experience, a strong carrier network, and innovative technology that, when combined with the industry presence and reputation of Hub Group, will unlock value for our customers and move our business forward.” Funding for the transaction of $130 million was provided by cash on hand, the news release stated, adding that Choptank expects to generate over $450 million of annual revenue in 2021.