Business Archives

TMC awards trainer of the month for November and December 2019

The Trucker News Staff - February 28, 2020

DES MOINES, Iowa — TMC has announced trainers of the month for November and December 2019. For November, Brian Post has been selected; and Ken Bates has been given the December recognition. Post began working with TMC in 2013 while in the process of retiring from the Army. After attending a career fair and meeting a recruiter, he had a feeling that TMC was going to be the place for him. “I’ve always had a ‘get the job done’ mindset, and I knew this was something I could do,” he said. After driving for two years, the idea of training other drivers came to Post somewhat organically. While picking up a load one day, another TMC driver asked him for assistance. “I came to find out he was a newer driver, and he wanted to make sure his securement and everything looked okay before he left,” Post said. Both drivers ended up delivering to the same place, and even though it wasn’t going to get him home, Post took another load that would keep him running with the new driver. “I just wanted to help the guy out and do the right thing for the company, and that’s really how it all started,” he said. Post always stresses to his drivers that safety is a priority. “My ultimate goal is to have drivers who are safe on the road and on the job,” he said. When Bates joined TMC in May 2014, he was new to the trucking industry. While in school, he did his research on different companies and TMC stood out from the rest. “From what I could tell, TMC had the best equipment and the best standard of training. Plus, I liked my recruiter,” he said. Becoming a driver trainer was always in the back of his mind, Bates said, but he took advice from his own trainer and waited until he had two years of experience under his belt. He started training others in 2016. “I really enjoy getting other drivers prepared for the field,” Bates said. “When they first start out, it can be overwhelming, so I’m very hands-on without being super strict.” Bates also stresses the importance of using all available resources whenever possible. “I credit TMC’s ‘Train the Trainer’ class for giving me a lot of the information I needed to start off and be successful. In that same way, I encourage my trainees to use their resources and expand their own knowledge whenever they can,” he said. Being named the Trainer of the Month wasn’t something that Bates was expecting, he said. “I really appreciate the recognition. It’s nice to know that I’m making a difference for the company,” he said.

Earnhardt elected general chair, treasurer of ATA’s Technology & Maintenance Council

The Trucker News Staff - February 27, 2020

ATLANTA — Stacy Earnhardt, director of asset management at Best Specialized, has been elected general chairman and treasurer of the American Trucking Associations’ Technology and Maintenance Council. The announcement was made Feb. 26 during the organization’s annual meeting. “Stacy has been an exemplary member of TMC, including winning the Silver Spark Plug this year,” said Robert Braswell, TMC’s executive director. “His professionalism and commitment to trucking make him an outstanding choice to be TMC general chairman and treasurer.” Earnhardt, who is from Kernersville, North Carolina, served this past year as TMC’s vice chairman and chairman of meetings. He succeeds Kenneth Calhoun, fleet optimization manager for Altec Industries of Conway, Arkansas, as general chairman and treasurer. “I’m honored to accept this position from my fellow TMC members,” said Earnhardt. “I look forward to working with the rest of TMC’s leadership to advance our industry’s goals. I also want to thank Kenneth for his service to our organization.” Outgoing chairman Calhoun said, “Being general chairman and treasurer has been an incredible honor for me, and I want to thank my fellow TMC members for it. As I hand off the chairmanship of TMC, I want to congratulate Stacy on his election and wish him luck. I’m sure he will be an outstanding leader for our council.” Others serving as TMC officers for 2020-2021 include: Vice chairman and chairman of meetings: Randy Obermeyer, director of maintenance, OnLine Transport Inc.; Chairman of study groups: Winston Minchew, training manager, Training Manager, Old Dominion Freight Line Inc.; Chairman of membership and publicity: Peter Savage, director of quality and implementations, Clarke Power Services Inc.; Chairman of associates: Jill Gingrich, vice president and managing director, WheelTime Network LLC; Immediate past chairman: Kenneth Calhoun; and Executive Director: Robert Braswell. Directors-at-large include: Scott Bartlein, Barry Trucking Inc.; Chris Disantis, Aim Nationalease; Roger Maye, ConMet; Radu Mihai, BURNCO Rock Products; Kevin Tomlinson, South Shore Transportation; Randy Tumbarello, Genox Transportation Inc.; Dave Walters, Alcoa Wheels; and Jim Boyd, Southeastern Freight Lines. By providing leadership support and opportunities to collaborate, TMC helps members develop the industry’s best practices that address the critical truck technology and maintenance issues that have the greatest impact on truck fleets.

Worldwide transportation giant closes Michigan facility; 120 workers lose jobs

The Trucker News Staff - February 27, 2020

COLDWATER, Mich. — Penkse, a well-recognized name in transportation and logistics on four continents, has announced layoffs in its logistics division. The company notified about 120 workers at its cross-dock facility in Coldwater, Michigan, that it will be permanently closing the operation effective April 30. Drivers were notified of the closure in a meeting with management Feb. 24. Randy Ryerson, vice president of marketing for Penske, told Freightwaves the closing of the Michigan facility is a result of an “unexpected loss of a fair market bid with Ford Motor Co.” All employees impacted are eligible for immediate openings elsewhere with Penske Logistics, and a representative has been appointed to help the laid-off employees transfer locations. In accordance with the WARN Act, requiring notifications of layoffs at least 60 days in advance, the company issued a notice with the Michigan Department of Labor and Economic Opportunity. Penske’s main offices are in Reading, Pennsylvania. Penske Logistics employs 5,000 drivers and maintains 3,600 power units in the U.S., as well as 18,000 employees in 400 locations throughout the world. This layoff is the company’s second in eight months, as it closed its terminal in Fort Wayne, Indiana, last July, when termination of a local contract resulted in 80 layoffs. Penske Corp. is a diversified on-highway transportation-services company with subsidiaries operating in industry segments including retail automotive, truck leasing, transportation logistics and professional motorsports. Penske Corp. manages businesses with consolidated revenues of more than $32 billion, operating in more than 3,200 locations and employing more than 64,000 people worldwide. Penske’s Premier Truck Group is best known for manufacturing trucks carrying the Freightliner placard, as well as two other truck groups, Western Star and SelecTrucks.

Fuel economy, maintenance must be considered for used trucks

Cliff Abbott - February 25, 2020

Small trucking businesses depend heavily on the used truck market but potential buyers trying to nail down the best choice are trying to hit a moving target. Prices fluctuate depending on economic conditions, freight availability and, increasingly, government mandates for emissions and fuel economy. For much of 2019, the economy was expected to slow, possibly going into recession. New truck purchases added capacity to the market. Spot freight rates slowed and then began falling, followed by contract rates. Several large carriers shut their doors due to (take your pick) tightening markets, rising costs, mismanagement or malfeasance. In theory, the used truck market should have received an influx of trucks. It did. According to a report from ACT Research, used truck sales declined by 15% in 2019 compared to 2018. Average prices declined too, by 7%, according to the same report. “Dealers are reporting used truck sales have slowed and inventory levels are building, particularly with late-model aerodynamic sleepers,” said Steve Tam, vice president at ACT Research. “The price depreciation is largely the result of inventories that have grown due to more trades coming to dealers, slowing freight, and the cyclical nature of truck sales.” While lower used truck prices may be attractive to smaller trucking businesses, including independent contractors, there’s a catch. In an effort to reduce emissions and increase fuel efficiency, the rules keep changing. The year 2007 brought a huge change. Drivers and owners of new trucks complained of lost time and expense due to an issue older trucks didn’t have, regeneration of the particulate filter that replaced the muffler. Drivers of older trucks smiled as they passed new equipment sitting on the shoulder for a “regen” or waiting for a tow. 2006 models sold in record numbers as carriers “pre-bought” trucks during the last year the “old” technology would be available. When those trucks hit the used truck market, an event hastened by the recession of 2008, prices dropped due to the large number available. Then 2010 brought a new set of standards and a product that drivers must have thought was a mechanic’s joke like “blinker fluid” or “muffler bearings.” New trucks were built with Selective Catalytic Reduction technology, necessitating the use of the now-familiar Diesel Exhaust Fluid (DEF). New trucks were more expensive but there was a tradeoff — fuel mileage was expected to improve, and it did. However, the first phase of EPA standards continued until 2017. Manufacturers achieved more power from smaller engines, made better use of aerodynamic technology and increased use of auto-shift transmissions to get top performance from each vehicle. While all this was happening, other technological advances increased safety levels. Collision mitigation systems that automatically apply brakes, lane departure warning systems, stability control and other safety features became standard equipment. Trucks became safer as they became cleaner and more fuel efficient. Purchase prices rose, but increased fuel economy offset the price, according to the non-profit Transport & Environment, an international group that promotes moving to an emissions-free transportation network. According to a January 2018 report from the group, a truck purchased in 2017 cost $2,400 more than one bought in 2011 but provided $8,200 in fuel cost savings over the older model. That was Phase 1 of the EPA’s plan. Phase 2 started in 2017 and ends in 2027. Another 10% improvement in fuel economy has been mandated, with improvements in emissions also required. In the meantime, advances in alternative fuel vehicles, including electric, will undoubtedly bring further changes to the industry, perhaps making diesel engines obsolete in the not-so-distant future. For the used truck shopper, the choices can be overwhelming. Buyers must consider more than simply price and mileage. Purchase price savings for a truck just a year or two older can be swallowed up in increased fuel costs. Plus, some states and metropolitan areas have restrictions on the type of equipment they allow to operate within their jurisdictions. Large carriers with newer equipment can offer lower freight rates, making competition more difficult for an independent owner with an older truck. Insurers may offer lower rates for trucks equipped with modern safety equipment. For drivers contemplating a used tractor purchase, research is more important than ever. The best deal available may not be the best decision. Before discussing price with a dealer, it may help to talk to carrier representatives, potential customers or other truckers with similar businesses. Equipment pricing must be weighed against fuel economy, anticipated maintenance costs and expected freight rates. The advantageous choice could be the newer, more expensive model.

ATA truck tonnage index rose 0.1% in January, 0.8% higher than January 2019

The Trucker News Staff - February 20, 2020

ARLINGTON, Va. – American Trucking Associations’ advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index rose 0.1% in January after rising 0.5% in December. In January the index equaled 117.4 (2015=100), compared with 117.3 in December. ATA recently revised the seasonally adjusted index back five years as part of its annual revision. “Over the last two months the tonnage index has increased 0.6%, which is obviously good news,” said Bob Costello, ATA chief economist. “However, after our annual revision, it is clear that tonnage peaked in July 2019 and, even with the recent gains, is down 1.8% since then,” he continued. “Softness in manufacturing and elevated inventories continue to weigh in on the truck-freight tonnage.” Compared with January 2019, the SA index rose 0.8%, which was preceded by a 3.1% year-over-year gain in December. In 2019 the index was 3.3% above 2018. The not-seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment, equaled 114.6 in January, 1.1% above the December level (113.3). In calculating the index, 100 represents 2015. (Note: ATA’s tonnage data is dominated by contract freight.) Trucking serves as a barometer of the U.S. economy, representing 71.4% of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods. Trucks hauled 11.49 billion tons of freight in 2018. Motor carriers collected $796.7 billion, or 80.3%, of total revenue earned by all transport modes. ATA calculates the tonnage index based on surveys from its membership, and has been doing so since the 1970s. This is a preliminary figure and is subject to change in the final report issued around the fifth day of each month. The report includes month-to-month and year-over-year results, relevant economic comparisons and key financial indicators.

The Trucker Newspaper – February 15, 2020 – Digital Edition

The Trucker News Staff - February 13, 2020

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Fleet Focus: ELDs push drivers to find ways to remain ‘productive’

Cliff Abbott - February 11, 2020

The crescendo has passed, but the symphony of protest against electronic logging devices (ELDs) is far from over. Despite the objections and barring a legislative turnaround of epic proportions, ELDs are here to stay. Whether the claims of enhanced safety provided by ELDs prove true, and so far they have not, carriers have a vital interest in protection against the “nuclear” verdicts being handed down in courtrooms. With paper logs, they had less control over the driver’s actions. Hours of Service infractions and falsifications that could potentially seal a verdict against the carrier might not be discovered until weeks afterward, when the logs were sent in. And, if the driver was good enough at “creative” logging, those infractions might not be discovered at all. Full disclosure: during a driving career, the writer may or may not be responsible for years of near-perfect duty status records that may or may not have been routinely (and beautifully) falsified. For most drivers, and especially owner-operators, it was important to “preserve” as many driving hours as possible in order to be productive (and profitable). So, two hours stuck in traffic went down as a half-hour driving and an hour-and-a-half break at the truck stop, or, the start time was simply adjusted to show beginning the trip much later. Recorded driving hours were calculated by dividing miles traveled by a reasonable “average” speed, usually five or so miles below the posted speed limit — but only when the result was fewer hours than actually spent driving that distance. Daily hours didn’t start until the truck was nearly loaded, foregoing the short drive from the truck stop and hours of waiting. ELDs have greatly reduced infractions and falsifications, and made it easier for carriers to identify those that still occur much sooner. Some will say that ELDs can still be falsified, but it’s also easier for both carriers and law enforcement to monitor. What has happened is that ELDs have brought to the surface something that drivers have known for decades — industry abuse of the driver’s working time has been rampant and mostly ignored. It’s amazing how many carriers suddenly became concerned about driver “productivity” when ELDs made it more difficult for drivers to “hide” non-productive hours. Dispatchers are no longer able to give wink-and-nod direction to “just do the best you can,” trusting the driver to make the paper logs look right. With ELDs in place, drivers and owner-operators need to find other ways to remain productive. That action might include becoming much more assertive when it comes to control of those available hours. Refusing dispatch, for example, is a legal descriptor of being an independent owner or contractor. Drivers should consider more than just miles and compensation rates when a load is offered. For example, loads traveling shorter distances are often less productive, especially when there’s a pickup and a delivery on the same day. The rate per mile offered should be greater than for longer loads. Potential traffic should be considered, too. A pickup scheduled for 8 a.m. in the center of a large metropolitan area virtually guarantees waiting in traffic congestion, whereas a pickup in a suburb, or in a smaller city, might get the driver in and out much faster. Customers who routinely take excessive amounts of time to load or unload can and should be avoided. Even if the customer or carrier pays for detention time, the amount is often far less than the driver earns during hours spent driving down the highway. In a world where compensation is usually calculated by the mile, drivers are often unaware of how their settlements equate to hourly pay. They shouldn’t be. Owners should keep a record of the total time spent on a load as well as compensation received. A load with 10 hours of driving that is loaded in an hour and unloaded in an hour means 12 hours invested. Make it four hours to load and four more to unload, and the time investment becomes 20 hours. Divide the revenue received by the time spent (12 hours or 20) and the resulting earnings per hour may differ greatly. The answer may be good to know the next time that load is offered. Managing a trucking business, even a one-truck outfit, is often a series of trade-offs. Owners must sometimes accept a not-so-good load to get in position for a better one or to get to needed maintenance (or a visit home). Even so, every load offered should be examined for its productivity potential. The impact of ELDs on productivity is real. Owners of small trucking businesses can minimize that impact by considering potential productivity on every load offered and by exercising the power of NO when necessary.

$225 million purchase enables C.H. Robinson to acquire Prime Distribution Services

The Trucker News Staff - February 6, 2020

Late last month, C.H. Robinson Worldwide Inc. announced its acquisition of the Prime Distribution Services business from Roadrunner Transportation Systems Inc. C.H. Robinson paid $225 million to acquire the carrier and incorporate it into its distribution network. Prime, of Plainfield, Ind., offers retail consolidation service, including distribution, fulfillment and inventory management to approximately 140 customers. The company was founded in 1990 and manages five fulfillment centers across the country, including 270 employees and 2.6 million square feet of distribution facilities. Prime’s 2019 revenue was $108.7 million. C.H. Robinson CEO Bob Biesterfeld stated in a press release, “Prime Distribution Services is a high-quality growth company that brings scale and value-added warehouse capabilities to our retail consolidation platform, adding to our global suite of services.” From Roadrunner Transportation System’s perspective, the sale of Prime will allow the company to move forward with financial confidence. “The divestiture of Prime Distribution Services is a unique opportunity for us to significantly improve our balance sheet,” Roadrunner CEO Curt Stoelting said. “We believe we are well-positioned to execute our strategy of simplifying our portfolio by investing in our remaining Ascent Global Logistics, Active On-Demand and asset-light less-than-truckload segments.” C.H. Robinson, based in Eden Prairie, Minn., has over $20 billion of freight under its management and processes 18 million shipments annually. The sale is not Roadrunner’s only effort to change its business model in light of a 2017 accounting scandal and weakening freight demand in 2019. In December, Roadrunner sold its flatbed business unit for $30 million in cash to an undisclosed buyer. A month prior, the company announced the sale of its intermodal business to Universal Logistics Holdings for $51.25 million in cash. Biesterfeld, in his comments on the acquisition, said, “Prime has an outstanding track record of success, a talented and experienced team and a focus on delivering great value to its customers and carriers.” The acquisition will integrate Prime into C.H. Robinson’s North American Surface Transportation division following the sale’s closing, expected by March 31.

DAT Solutions: Spot market shifts in shippers’ favor

The Trucker News Staff - February 3, 2020

PORTLAND, Ore. — Spot load-to-truck ratios for all three equipment types fell during the week ending Jan. 26, and truckload rates for vans and reefers drifted lower as shippers had little trouble finding trucks to haul their freight, reported DAT Solutions, which operates the industry’s largest load board network. This current lull may be shorter than expected but for now conditions on the spot market favor shippers and demand a creative approach from truckers. National average spot rates, January (through Jan. 26) included: Van: $1.90 per mile, down 4 cents from the December average Reefer: $2.27 per mile, down 3 cents from December but 9 cents higher than November Flatbed: $2.18 per mile, unchanged from December Van trends The national average spot van load-to-truck ratio slipped from 2.1 to 1.6 on neutral van volumes compared to the previous week. For the second straight week, the average van rate was lower on nearly all of DAT’s top 100 van lanes, and rates were higher only on lanes where pricing tends to be weak. The good news is carriers can almost always find van loads in big Southeast retail freight hubs. The bad news is it’s hard to find lanes between these markets that pay well right now. For example, Memphis, Tennessee to Charlotte, North Carolina fell 14 cents to $1.95 a mile last week, while the return trip lost 9 cents to $1.45. One option for carriers is to find higher-paying loads in smaller markets where they can triangulate. Instead of hauling a load from Charlotte back to Memphis, they can look for a load from Charlotte to Macon, Georgia, which currently averages $1.95 per mile, and then book a load from Macon to Memphis, which pays $2.11. A Memphis-Charlotte round trip averaged $1.76 per loaded mile last week for a total of $2,166. The three-legged route through Macon averages $2.05 a mile, which at that rate would earn the carrier $2,806 while adding 136 paid miles to the trip. Depending on the driver’s hours of service, triangular routing may be a good choice in a tough rate environment. Reefer trends This is a quiet period for reefer freight, which is closely tied to domestic produce harvests. The national average reefer load-to-truck ratio was 3.8, down from 4.9 the previous week. As a result, the average spot rate fell on 71 of DAT’s top 72 reefer lanes by volume. The sole riser was Grand Rapids, Michigan, to Madison, Wisconsin. Produce imports from Mexico and at some seaports tend to populate the spot market but many of the loads coming through these ports of entry are scheduled and moving under contract. Plus, there are lots of trucks available in those markets. As a result, the average spot reefer rate fell on 71 of the top 72 reefer lanes by volume. The sole riser was Grand Rapids, Michigan, to Madison, Wisconsin. These rates are based on RateView, DAT’s database of $68 billion in annual market transactions. DAT’s freight rate database also provides the settlement prices against which trucking freight future contracts are traded. For information, visit dat.com.

TRATON makes unsolicited proposal to acquire Navistar for $35 per share in cash

The Trucker News Staff - January 30, 2020

LISLE, Ill. – Navistar International Corporation confirmed on Thursday, Jan. 30, that it has received an unsolicited proposal from TRATON SE regarding a potential transaction to acquire the company for $35 per share in cash. TRATON SE is a subsidiary of Volkswagen AG and a worldwide commercial vehicle manufacturer offering light-duty commercial vehicles, trucks and buses. Navistar is a holding company whose subsidiaries and affiliates produce International brand commercial trucks, proprietary diesel engines and IC Bus brand school and commercial buses. An affiliate also provides truck and diesel engine service parts. Another affiliate offers financing services. Consistent with its fiduciary duties, Navistar’s Board of Directors, in consultation with its financial and legal advisors, will carefully review and evaluate the proposal in the context of Navistar’s strategic plan for the company in order to determine the course of action that it believes is in the best interest of the company and its stakeholders. Navistar advises its shareholders to take no action, and no shareholder vote is required at this time. There can be no assurance that any negotiations between Navistar and TRATON regarding this proposal will take place, and if such negotiations do take place, there can be no assurance that any transaction with TRATON will occur or be consummated. Navistar does not intend to make any additional comments regarding the proposal unless and until it is appropriate to do so or a formal agreement has been reached.

Georgia seaports set new record cargo volumes in 2019

The Associated Press - January 28, 2020

SAVANNAH, Ga. — The amount of cargo moving through Georgia’s seaports reached record levels in the past year, in part because of continued growth fueled by larger ships traversing the expanded Panama Canal, the Georgia Ports Authority’s top executive said Jan. 28. The state-operated ports in Savannah and Brunswick handled a total of 38.5 million tons of imports and exports in calendar 2019, the agency reported. That’s an increase of 4.3% compared to last year. The number of cargo containers, large metal boxes used to ship goods from consumer electronics to frozen chickens, moving across the docks at the Port of Savannah also reached record highs last year. The port handled 4.6 million container units through December, up 5.6% from 2018. Griff Lynch, the port authority’s executive director, attributed much of the 2019 growth to the expansion of the Panama Canal that opened nearly four years ago. He said shippers are still increasing the size of the vessels using the route, funneling more cargo to the East Coast. “On the container side, I think it still comes down to the expansion of the canal,” Lynch said. “We’re still enjoying the fruits of that.” Savannah is the fourth-busiest U.S. port for shipping containerized cargo, behind only the Port of New York and New Jersey, and the ports of Los Angeles and Long Beach, California. The Army Corps of Engineers is overseeing a $973 million deepening of the shipping channel that connects Savannah’s port to the Atlantic Ocean to make room for the larger ships. Work on the projects second half began in September and is expected to be complete by the end of 2021. A boost in automobile exports also helped to grow Georgia’s cargo volumes last year. GM and Volvo began exporting vehicles through Savannah last year, with Volvo also shipping cars through Brunswick. Overall, the ports moved more than 657,000 cars, trucks and tractors, up 2 percent from 2018. Lynch said tariff increases last year during the U.S. trade war with China likely slowed the Georgia ports’ 2019 growth. Now he expects Georgia to benefit after President Donald Trump signed the first part of a new U.S.-China trade agreement in which China has pledged to buy more U.S. agricultural products. “We think that’s going to be a big deal for us,” Lynch said. “We’re already seeing it. Poultry is starting to move again, and that has been flat for several years.”

ATA Truck Tonnage Index increased 3.3% in 2019

The Trucker News Staff - January 22, 2020

ARLINGTON, Vir. — American Trucking Associations’ advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index increased 3.3% in 2019, about half the annual gain in 2018 (6.7%). The increase was the tenth consecutive year in which the tonnage index has risen above the previous year. The advanced SA For-Hire Truck Tonnage Index rose 4% in December after falling 3.4% in November. In December, the index equaled 118.2 (2015=100) compared with 113.6 in November. “Last year was not a terrible year for for-hire truck tonnage, and despite the increase at the end of the year, 2019 was very uneven for the industry,” said ATA Chief Economist Bob Costello. “The overall annual gain masks the very choppy freight environment throughout the year, which made the market feel worse for many fleets. In December, strong housing starts helped advance the index forward.” It is important to note that ATA’s tonnage data is dominated by contract freight. November’s reading was revised down slightly compared with the December 2019 data. In December 2018, the SA index rose 3%, which was preceded by a 2% year-over-year drop in November. The not seasonally adjusted index, which represents the change in tonnage hauled by the fleets before seasonal adjustment, equaled 112.7 in December, 2% below the November level (115.1). In calculating the index, 100 represents the index from 2015. Trucking serves as a barometer of the U.S. economy, representing 70.2% of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods. Trucks hauled 10.77 billion tons of freight in 2017. Motor carriers collected $700.1 billion, or 79.3% of total revenue earned by all transport modes.

ACT Research For-Hire Trucking Index: Rates slip amid strong holiday freight

The Trucker News Staff - January 22, 2020

COLUMBUS, Ind. – The latest release of ACT’s For-Hire Trucking Index showed improvement in for-hire freight volumes and utilization. The data used in the Index included December. Respectively, the data indicated 55.5 and 52.3 diffusion index readings, both up four points from November on a seasonally adjusted basis. But even as for-hire capacity contracted again, the Freight Rates Index slid to 48.7 in December. The ACT For-Hire Trucking Index is a monthly survey of for-hire trucking service providers. ACT Research converts responses into diffusion indexes, where the neutral or flat level is 50. Tim Denoyer, ACT Research’s Vice President and Senior Analyst commented, “We see encouraging signs that the freight downturn is in its late stages and the market will rebalance in 2020. However, the ongoing rate pressure, even as volumes ramped into the holidays, is symptomatic of ongoing excess industry capacity. Our survey respondents clearly get it, and reduced capacity for a sixth straight month, so we can pretty easily deduce that private fleet capacity additions through year-end 2019 are the main factor continuing to pressure for-hire rates.” The ACT Freight Forecast provides forecasts for the direction of truck volumes and contract rates quarterly through 2020, with three years of annual forecasts for the truckload, less-than-truckload and intermodal segments of the transportation industry. For the truckload spot market, the report provides forecasts for the next twelve months. In 2019, the average accuracy of ACT’s truckload spot rate forecasts was 98%. The ACT Research Freight Forecast uses equipment capacity modeling and the firm’s economics expertise to provide anticipated freight rates, helping businesses in transportation and logistics management plan with confidence.

2019 trading performance ended on a sour note for transportation companies

The Associated Press - January 21, 2020

For major shipping companies dealing with trade wars and slowing global growth, conditions appear to have deteriorated as 2019 came to a close. Transportation companies are the worst performers across the market in trading. Shares in trucking, railroad and ocean shipping companies are selling off. The trade war between the U.S. and China has taken a toll. Government data showed Friday that China’s economy grew by 6.1% last year, down from 6.6% in 2018, and a multi-decade low. The Trump administration has agreed to cancel planned tariff hikes on additional Chinese imports as part of an interim deal announced this week, and Beijing promised to buy more American farm goods. Punitive duties already imposed by both sides, however, will stay in place. JB Hunt Transport Services Inc., a trucking company, on Friday reported profits that fell well short of what industry analysts had expected, according to a survey by Zacks Investment Research. Shares in that company are down 2.7%. FedEx reported last month that its profit slid 40%, hurt by higher costs, a shorter holiday season and its move to cut ties with Amazon.com. It too, cut its profit expectations. UPS reports fourth quarter and full year results at the end of the month. Its shares have been falling over the past month and were down in trading as of Friday. Global shipping and logistics provider Expeditors International said Friday that it expects fourth quarter operating income to fall between $177 million and $183 million. CEO Jeffrey Musser cited trade disputes and slowing growth for a number of economies. The report comes a day after the railroad CSX reported a 7% decline in the freight it hauled during the final months of the year. “We’ve seen impacts throughout the year from these market conditions, but the pace at which these changes occurred accelerated dramatically in the fourth quarter,” Musser said. “We know this environment will change over time, as it always has in the past.” Shares of Expeditors International of Washington Inc., based in Seattle, slumped almost 5%.

Safety Series: Awareness, anticipation of 4-wheel drivers can help keep truckers safe

Cliff Abbott - January 16, 2020

You know it’s coming. It may be in the next mile or a few hours down the road, but it will happen. Somebody is going to do something stupid. It might be a sudden lane change, disobeying a traffic signal or sign, checking text messages on a cell phone or any of dozens of errors in judgment that the professional driver observes from other motorists every day. But it will happen. Nearly every driver has been trained in defensive driving techniques at some point and knows the importance of watching out for the actions of others. Some carriers and insurance companies, however, are teaching drivers to go beyond “defensive” driving. They encourage professional drivers to drive in a manner that protects others, too. Why should a professional driver care about protecting other motorists? Those four-wheelers can be really annoying when they’re not being downright dangerous. But consider who is driving those four-wheelers. Someone’s wife, father, child or loved one is behind the wheel. Back home, it could be YOUR loved one behind the wheel of another four-wheeler. Would you appreciate another truck driver watching out for your loved ones, even when those loved ones make driving mistakes? Then consider that professional drivers have much more training and experience than the average motorist. You may think of hazards and take action to avoid them much sooner than the average motorist, who may not recognize a hazard at all until it’s too late. So, how do you “protect” someone driving in another vehicle? One way is to avoid making assumptions about how they’ll react to a hazard. Consider an intersection with traffic lights. Your light just turned green, so you know that the light for cross traffic is now red. They’ll stop, right? By making sure before you pull into the intersection, you can avoid a crash with someone who didn’t see, or didn’t obey, the traffic signal. Sure, it might have been some jerk running the light, but it could have been a young woman distracted by a crying baby, too. Another example is the left turn at an intersection. Make sure there’s enough time for your trailer to fully clear the intersection before oncoming traffic arrives. When you’re starting from a stop, it could take 20 seconds or longer for your trailer to fully clear. It’s tempting to assume that oncoming drivers will see your big truck and slow down or stop – but what if they don’t? Lane changes are sometimes necessary, but who hasn’t seen a driver trying to gain time by weaving from lane to lane? Consider how other vehicles will react to your lane change. Others may now change lanes, and speed, in an effort to get around you. Each lane change is another opportunity for a crash to occur. Even an action like blowing the air horn could startle an unsuspecting motorist, causing them to steer suddenly. The dangers of using phones to call, text and surf the Internet while driving are well known, yet motorists are seen doing those things all of the time. That includes, unfortunately, some truck drivers, too. Make it a rule never to use yours while driving, unless you have a hands-free option. Even then, taking your eyes off the road for a second to see who’s calling can lead to an accident. A policy of waiting until you are stopped to return calls or texts is the right way to do things. Make sure friends and relatives know that you’ll chose safety over quick communication.

DOT Freight Transportation Services Index increases 0.1% in November

The Trucker News Staff - January 9, 2020

WASHINGTON — The Freight Transportation Services Index (TSI) based on the amount of freight carried by the for-hire transportation industry, rose 0.1% in November from October, increasing for the second consecutive month, according to the U.S. Department of Transportation’s Bureau of Transportation Statistics’ (BTS). The November measure was 2.0% below the all-time high level of 140.2 in August 2019. The October index was revised to 137.3 from 138.6 in last month’s release, but still remains above September. August was revised up slightly and July was revised down slightly. The Freight TSI measures the month-to-month changes in for-hire freight shipments by mode of transportation in tons and ton-miles, which are combined into one index. The index measures the output of the for-hire freight transportation industry and consists of data from for-hire trucking, rail, inland waterways, pipelines and air freight. The TSI is seasonally-adjusted to remove regular seasons from month-to-month comparisons. The November Freight TSI 0.1% increase was narrowly based with increases only in pipeline and rail carloads, with trucking, water, air freight and rail intermodal declining. The TSI increase took place against a background of strong results for several other indicators and sustained weakness in one. The Federal Reserve Board Industrial Production Index increased in November, reflecting increases in manufacturing and utilities and a small decrease in mining. Personal income increased by 0.5%, while housing starts increased by 3.2%. The Institute for Supply Management Manufacturing index decreased 0.2 points to 48.1, indicating contraction in the manufacturing sector for the fourth consecutive month. The ISM manufacturing index is based on a survey of 800 supply chain executives, on production, orders, deliveries, and employment, while the Federal Reserve IP index is based on estimated physical output using a range of output measures that the Federal Reserve considers reliable. The November index was at the same relatively high level as January 2019 despite dips during the early part of the year and a rise to a record level in August. The November index was higher than all but two months prior to 2019. It was exceeded by only October 2018 and November 2018 and five earlier months in 2019. The Freight TSI rose 16.8% from the recent low of 120.0 in March 2016 to a level of 140.2 in August 2019 but has declined by 2.0% since then. The November 2019 index was 44.9% above the April 2009 low during the most recent recession.

Knight-Swift and DAT announce pilot program for predictive rate forecasting

The Trucker News Staff - January 7, 2020

PORTLAND, Ore. —DAT Solutions has announced that it is supplying Knight-Swift Transportation, North America’s largest truckload fleet, with a powerful new rate forecasting tool to provide actionable short-term and long-term insights into transportation markets. The tool provides forecasts based on the DAT RateView database of more than $68 billion in annual freight transactions. “Knight-Swift is eager to begin testing DAT’s new rate forecasting tool,” said Don Everhart, vice president of technology and analytics for Knight-Swift Logistics. “In our experience, DAT is the most accurate and complete source of spot and contract rate data available. We are looking forward to applying these rate predictions to significantly improve the speed we can serve customers, while mitigating price risk.” The pilot program will run through Q1. The DAT rate forecasting tool will then be made widely available to third-party logistics providers, freight brokers, truck fleets, financial analysts, and other industry stakeholders at the start of Q2. “DAT’s data science team tested the rate prediction algorithms for months, back-checking its forecasts against actual results and refining the models to improve accuracy, but the partnership with Knight-Swift provides the perfect proving ground,” according to Ken Adamo, DAT chief of analytics. “This pilot is an important step as we develop and broaden the commercial scope of our best-in-class forecasting tools,” explained Adamo. “Our forecasting is based on the most historically complete database on the market today. That’s important, because the best indicator of future prices is historical prices, and by teaming with Knight-Swift, we can continue to refine the algorithms to solve real-world problems.” “Our customers grapple with uncertainty every day,” added Claude Pumilia, DAT Solutions CEO and president. “That’s why we’re proud to have earned the trust of Knight-Swift and look forward to working with them as they put our rate forecasting tools to use and get a clearer picture of the road ahead.”

Industry veteran Eric Anson named president of Transport America

The Trucker News Staff - January 6, 2020

EAGAN, Minn. – TFI International Inc., a North American leader in the transportation and logistics industry, announced today that Eric Anson has been named president of U.S. Truckload operating company Transport America (TA). Anson joined TA in 2017 and moves into the company’s top leadership role from his previous position as vice president of operations. He will have executive responsibility for the company’s overall operating and sales strategy, market growth and financial performance and will report to Greg Orr, executive vice president of TFI responsible for TFI’s U.S. truckload operations. “Eric is a respected industry executive with proven experience building successful, profitable truckload operations,” said Orr. “I’m confident Eric’s leadership skills combined with his background of progressive growth and innovation will complement our team and continue to improve the quality and depth of the service offerings we provide our customers.” Anson brings a deep background in truckload industry operations to his new role. Prior to TA, he served in increasingly senior operations and management positions with Knight Transportation, Marten Transportation and Interstate Distributors. He’s a graduate of Oregon State University where he earned his bachelor’s degree. Anson will be based at TA’s operating headquarters in Eagan, Minn.

Research indicates 14% rise in Class 8 sales in December over previous month

The Trucker News Staff - January 6, 2020

Preliminary reports from both FTR Transportation Intelligence and ACT Research indicate that December North American Class 8 sales improved as compared to November sales numbers. ACT Research notes that net orders in December 2019 were 20,000 units, which is up 14% from November and down just 6.5% from year-ago December, as the industry transitions to much easier year-over-year comparisons. Complete industry data for December, including final order numbers, will be published by ACT Research in mid-January. “Overbuying through 2019 and insufficient freight to absorb the ensuing capacity overhang continued to weigh on the front end of the Class 8 demand cycle in December,” said Kenny Vieth, ACT’s president and senior analyst. “Recalling July and August, orders were down 80% from the corresponding months in 2018. December’s orders brought the full-year 2019 volume to 181,000 units versus 490,100 units in 2018.” FTR states that fleets are being very cautious in this environment, only ordering what they know they need for the next few months. Orders averaged just under 20,000 units a month for the fourth quarter, basically right at replacement demand. Order rates are expected to stay in this range for the next few months. Although the December order activity improved 14% month over month, the total was still below the less-than-robust results seen during October and down 7% year over year. Class 8 orders for the past 12 months have now totaled 179,000 units, according to FTR. “This is as balanced and stable as you are going to see in Class 8 ordering,” noted Don Ake, FTR’s vice president commercial vehicles. “Fleets are ordering trucks according to their standard replacement cycles and for normal delivery cycles. They are not speculating about the future direction of the freight market because there is too much uncertainty. This is a ‘wait and see’ approach.”

J.B. Hunt acquires RDI Last Mile Co. in continued growth of Final Mile Services

The Trucker News Staff - January 2, 2020

LOWELL, Ark. — J.B. Hunt Transport Services, Inc., one of the largest supply chain solutions providers in North America, has announced that its subsidiary, J.B. Hunt Transport, Inc., acquired the assets of RDI Last Mile Co. on December 31, 2019. The transaction was funded using J.B. Hunt’s existing revolving credit facility. “Growing our final mile delivery capabilities is a priority, and the acquisition of RDI further extends our expertise in furniture delivery,” said John Roberts, president and CEO of J.B. Hunt. Founded in 1987, RDI provides home delivery services of big and bulky products in the Northeast region of the U.S. RDI utilizes contract carriers to perform primarily furniture deliveries and generates annual revenue of $35 million. “Providing our customers with a comprehensive, high-quality delivery experience drives our final mile services,” said Nick Hobbs, executive vice president and president of Dedicated Contract Services at J.B. Hunt. “RDI is a reputable furniture delivery provider, and we are excited to welcome them to J.B. Hunt.” Final Mile Services is a division of J.B. Hunt’s Dedicated Contract Services business unit and operates one of the largest nationwide, commingled cross-dock operations with the ability to serve 100% of the contiguous United States. RDI is the company’s third acquisition in as many years. J.B. Hunt acquired Cory 1st Choice Home Delivery in 2019 and Special Logistics Dedicated in 2017. With the RDI acquisition, Final Mile Services will expand its home delivery capabilities and grow to include more than 104 locations and 3.2 million square feet of warehouse and facilities space.