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NFI acquires G&P Trucking Co., expanding transportation presence in Southeast

Camden, N.J. — NFI, a supply chain solutions provider, recently completed the acquisition of G&P Trucking Company, Inc. (G&P), a logistics provider specializing in asset-based transportation, port drayage, and non-asset brokerage solutions in the Southeast. The acquisition further establishes NFI’s position as a premier transportation provider, strengthening NFI’s asset and non-asset solutions and expanding its southeast footprint. G&P, headquartered in Columbia, South Carolina, has more than 83 years of experience in providing transportation services for customers across its 14 locations. The addition of G&P enhances NFI’s network density in the Southeast and increases the company’s footprint to more than 300 locations throughout North America, employing more than 12,600 associates. Further, G&P deepens NFI’s industry expertise throughout diverse industries such as automotive, tires, retail, and textiles. “Powered by the same philosophies as G&P, NFI will allow for greater opportunities for our employees, partners, and customers,” said Clifton Parker, President and General Manager of G&P. “We look forward to the future and are eager to continue our growth and success with NFI.” G&P’s asset-based transportation solutions include dedicated, regional, long haul, and Mexico border crossing. With G&P’s 370 tractors and 3,000 trailers, NFI’s asset-based transportation fleet, predominantly providing dedicated contract carriage solutions, will grow to more than 3,000 tractors and 12,500 trailers. With the addition of G&P, NFI’s asset-based fleet will be operated by 2,700 company drivers and utilize the services of 400 owner operators. Operating at the ports of Savannah, Norfolk, and Charleston, G&P will expand NFI’s drayage presence in those ports. With the addition of G&P’s 120 owner operator partnerships, NFI’s drayage fleet will grow to more than 1,500 tractors. NFI’s expansive drayage presence spans major ports, terminals, and logistics hubs across the U.S., offering a full suite of supply chain solutions that includes transloading, consolidation, deconsolidation, and customs exams. The acquisition will also enhance NFI’s brokerage service offerings. “G&P is a well-respected, family-owned transportation company with a deep-rooted history, and our shared values of family and integrity create a perfect cultural fit,” said Sid Brown, CEO of NFI. “Unifying the talents of both NFI and G&P teams, we are excited to bring even greater value to our customers through our robust suite of solutions. Together, our combined footprint will distinguish us as one of the largest dedicated transportation providers in North America.”

ACT Research: Tough times coming in 2020 for Class 8 market

COLUMBUS, Ind. – According to ACT Research’s recently released Transportation Digest, carrier profitability and by extension Class 8 demand are heading toward tougher business conditions in 2020. Succumbing to the slowing economy, forward-looking metrics in the medium duty Classes 5-7 markets were awash in a sea of red ink in October, although moderate growth persists in build expectations. The report, which combines ACT’s proprietary data analysis from a wide variety of industry sources, paints a comprehensive picture of trends impacting transportation and commercial vehicle markets. This monthly report is designed as a quick look into transportation insights for use by fleet and trucking executives, reviewing top-level considerations such as for-hire indices, freight, heavy and medium duty segments, the US trailer market, used truck sales information, and an overview of the U.S. macro economy. “After peak sales and build in 2019, significant declines are ahead in 2020, as heavy-duty sales and build follow the net orders trend down. But if our forecast of ongoing (but slower) economic expansion holds in 2020, the drop will be a correction (along the lines of 2015 and 2016), not a devastating recession (as in 2008 and 2009),” said Kenny Vieth, ACT’s president and senior analyst. Regarding the medium duty market, Vieth commented, “Given its traditional status as the strongest medium duty order month of the year, October’s disappointment suggests further softening of customer demand. Following September’s bow shot, the downward trajectory of the seasonally adjusted annual rates in the past two months suggests the slowing of build rates the past two months are looking more like a new paradigm, rather than a pause that refreshes.”

ACT For-Hire Trucking Index shows utilization shifted into reverse in November

Columbus, Ind. – The latest release of ACT’s For-Hire Trucking Index, with November data, showed relatively neutral readings on for-hire freight volumes and rates, with 51.5 and 50.9 respective diffusion index readings. With a slight contraction in for-hire capacity, the supply-demand balance remained in modestly positive territory for a fifth straight month. However, the Productivity Index fell to 48.4 in November, from 53.9 in October. “With some key caveats, we think the string of positive supply-demand results is a positive leading indicator for a capacity rebalancing in 2020,” said Tim Denoyer, ACT Research’s vice president and senior analyst. “The first caveat is that private fleets, the other half of the industry, are not showing the same capacity discipline as the for-hire fleets. The second is that the freight volume outlook remains muted, with a soft manufacturing sector and trade-related inventory overhang likely outweighing relief from the China phase-one deal, which is yet to be signed.” He continued, “Tractor utilization has been choppy all year, amid soft freight and overcapacity, but the biggest surprise in this month’s survey was the sharp reversal in tractor productivity, a signal that while the freight recession is likely in the late-innings, the trucking industry is still staring at difficult conditions in the near-term.” 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. Email  [email protected] if you are a for-hire executive interested in participating. In return, participants receive a detailed monthly analysis of the survey data, including Volumes, Freight Rates, Capacity, Productivity and Purchasing Intentions, plus a complimentary copy of the Transportation Digest report. 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. The ACT Research Freight Forecast uses equipment capacity modeling and the firm’s economics expertise to provide unprecedented visibility for the future of freight rates, helping businesses in transportation and logistics management plan for the future with confidence. For more information, visit www.actresearch.net.

ATA seasonally adjusted Truck Tonnage Index drops 3.5% in November

Arlington, Va. — American Trucking Associations’ advanced seasonally adjusted For-Hire Truck Tonnage Index decreased 3.5% in November after falling 0.7% in October. In November, the index equaled 113.5 (2015=100) compared with 117.6 in October. “It’s tough to sugar coat November’s reading,” said ATA Chief Economist Bob Costello. “It was the third decrease in the last four months and the index is down 7.2% since July. Additionally, November was the first month to see a year-over-year drop in the index since April 2017. While disappointing, it fits with the expected soft gross domestic product reading expected in the fourth quarter and reports of a soft fall freight season.” It is important to note that ATA’s tonnage data is dominated by contract freight. October’s reading was revised down compared with ATA’s November press release. Compared with November 2018, the seasonally adjusted index fell 2.1%, the first year-over-year decline since April 2017 and the largest drop since February of that year. The index is up 3.3% year-to-date compared with the same period last year. The not seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment, equaled 115 in November, 7.9% below the October level (124.8). In calculating the index, 100 represents 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. 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 subject to change in the final report issued around the 5th day of each month. The report includes month-to-month and year-over-year results, relevant economic comparisons, and key financial indicators.

ACT Research: Used truck sales return to trend and are down 16% YTD

COLUMBUS, Ind.  – After an anomalous sequential gain in October, used Class 8 same dealer sales volumes returned to trend in November, falling 35% month-over-month, according to the latest release of the State of the Industry: U.S. Classes 3-8 Used Trucks, published by ACT Research. Longer term, sales were down 9% year-over-year and 16% year-to-date compared to the first 11 months of 2018. The report also indicated used Class 8 average miles decreased month-over-month, down 5%, and were up a mere 1% year-to-date, while average age rose 3% compared to October and 5% on a year-to-date basis. Average price also grew 5% month-over-month, while flat year-to-date. The report from ACT provides data on the average selling price, miles, and age based on a sample of industry data. In addition, the report provides the average selling price for top-selling Class 8 models for each of the major truck OEMs – Freightliner (Daimler); Kenworth and Peterbilt (Paccar); International (Navistar); and Volvo and Mack (Volvo). This report is utilized by those throughout the industry, including commercial vehicle dealers, to gain a better understanding of the used truck market, especially as it relates to changes in near-term performance. “Dealers are reporting used truck sales are lagging, inventory is building, prices are falling, and the used truck market remains a buyer’s market,” said Steve Tam, vice president at ACT Research. He continued, “While all of this is not welcome news for finance companies, truckers trading trucks, truck OEMs or dealers, it is good news for people who are buying trucks. Customers are finding that there are bargains available for all makes and models of used trucks, and there are some fantastic buys.” ACT Research is recognized as the leading publisher of commercial vehicle truck, trailer, and bus industry data, market analysis and forecasts for the North America and China markets. ACT’s analytical services are used by all major North American truck and trailer manufacturers and their suppliers, as well as banking and investment companies. For more information, visit www.actresearch.net.

Spot rate ride strong as holiday volumes keep trucks busy

PORTLAND, Ore. — Trucks are busy in these final weeks before the holidays. Spot van freight volumes were up more than 25% during the week ending December 15 and the national average spot van rate for December is $1.91 per mile, 9 cents higher than November, reported DAT Solutions, which operates the industry’s largest electronic marketplace for truckload freight. Van trends The average van rate increased on 26 of DAT’s top 100 van lanes by volume. Forty-three lanes were lower and 31 stayed the same. The national average van load-to-truck ratio declined from 4.0 during the previous week to 2.9, meaning there were 2.9 available loads for every truck posted on the DAT network. That’s higher that the average ratio in November (2.3) and October (1.7). Outbound freight volume rose steadily on 89 of the top 100 lanes, and the abundance of loads has helped keep rates high. Rate increases were concentrated in markets and lanes associated with retail freight, including: Buffalo, New York, to Charlotte, North Carolina: $2.11 per mile, up 11 cents Philadelphia to Boston: $3.88 per mile, up 12 cents. The return trip increased 9 cents to $1.99 per mile. Memphis to Atlanta: $2.52 per mile, up 9 cents Atlanta to Dallas: $1.64 per mile, up 1 cent. This is the highest rate on this lane since July. Reefer trends At the national level, reefer rates are not backing away from pre-Thanksgiving highs. The national average spot reefer rate in December is $2.23 per mile, 5 cents higher than the November average. The load-to-truck ratio fell from 7.4 to 4.9. Rates rose on high-volume lanes out of Elizabeth, New Jersey, home to the largest seaport on the East Coast, a sign of high demand to move imported produce. McAllen, Texas, also had rising rates due to imports. This weekly spot-rate snapshot is derived from DAT RateView, which provides real-time reports on spot market and contract rates, as well as historical rate and capacity trends. The RateView database is comprised of more than $68 billion in annualized freight payments. www.dat.com/trendlines    

Annualized turnover rate for large, small TL carriers up in third quarter

ARLINGTON, Va. — The annualized turnover rate at both large and small truckload carriers rose in the third quarter, according to American Trucking Associations’ Quarterly Employment Report. The turnover rate at large truckload fleets – those with more than $30 million in annual revenue – jumped nine points, the largest quarterly increase since the second quarter of 2016, to an annualized rate of 96%. The increase set the figure at its highest point since the second quarter of 2018. The churn rate at smaller carriers also rose – ticking up six points to 73% from the lowest level since 2011. “Counterintuitively, we saw turnover rise even as the freight demand was relatively soft,” said ATA Chief Economist Bob Costello. “While turnover rose at both small and large carriers, the reasons were quite different. Large carriers reduced the number of drivers they employed, in keeping with lackluster freight levels, but smaller carriers added to their driver pools, increasing their number of drivers by 1.9%. “During the first two quarters of the year, larger carriers added drivers, but in the third quarter they started right-sizing their fleets. Conversely, smaller companies increased their driver pool in the third quarter for the first time this year.” Turnover at less-than-truckload carriers dropped four points to an annualized rate of 9% – the lowest level it has been at since the final quarter of 2017. The third quarter 2019 rate is in stark contrast to the comparable quarter in 2018 when the turnover rate fell 11 percentage points – dropping it to 87 percent, marking its lowest point since the first quarter of 2017 when it stood at 74 percent. The third quarter 2018 drop also reversed two consecutive quarters of increases in the turnover rate, which had driven up the churn rate as high as 98 percent – 10 points higher than at the end of 2017. “The drop in turnover can be potentially explained in a few ways,” Costello said in 2018. “First, large pay increases fleets have been offering appear to be working, and drivers are remaining with their current carrier. Second, we did see a softening of freight markets in the third quarter from the incredibly strong pace it had set earlier in the year. Historically, softer freight volumes lead to lower driver turnover.”      

Volvo to lay off some 700 at New River Valley plant in Dublin, Virginia

DUBLIN, Va. — Roughly 700 assembly-line workers at Volvo’s New River Valley plant in Dublin, Virginia, will be laid off beginning the week of January 20, 2020. This reduction in force is said to come from a pullback in production which is reflective of the downturn in orders of new Class 8 trucks.  “We regret having to take this action, but we operate in a cyclical market, and after two years of extremely high volumes, we have to adapt to reduced market demand,” a Volvo spokesperson said. “You might recall we confirmed back in June, around the time we announced our $400 million investment in NRV, that we expected to have to lay people off around year-end.”  This investment will be unaffected by the announcement of layoffs and will include an expansion of the company’s industrial footprint and installation of a variety of state-of-the-art equipment. Over the next six years, the expansion is expected to create 777 new jobs at the facility.  Virginia’s Pulaski County has granted Volvo 222 acres of adjacent property to expand the campus and providing $500,000 toward site improvements.  November sales numbers for the Swedish truck maker indicate a decrease of 30.5% for November 2019 from November 2018. Year-to-date, Volvo’s sales have seen a 1.2% decrease. From October to November, the company’s sales have decreased by 32%.  “We expect the total North American truck market to be down nearly 30 percent, or about 100,000 trucks, in 2020,” a Volvo spokesperson said. “And we expect one of Volvo’s core segments, the long-haul truck market, to represent a significant part of that reduction.”  Only two months ago, some 3,500 United Auto Workers members at Volvo-owned Mack Trucks participated in a strike for first time in 35 years in October. The 12-day strike at six locations across three different state ended with a new four-year agreement that covered 3,500 employees at six facilities in Pennsylvania, Maryland and Florida.  Volvo isn’t the only truck manufacturer to experience layoffs. Just three months ago, Daimler Trucks North America eliminated 450 jobs each at two North Carolina plants citing a downturn in the market demand for production.  A spokesperson for Volvo said that outplacement support meetings led by the company and UAW representatives will be provided for all employees affected by the layoffs and employees will also be provided information about support available through the Virginia Employment Commission. 

Trailer sales see decrease in November from October due to cautious planning by fleets

Two organizations responsible for tracking and analyzing data about the U.S. commercial motor vehicle market both note that trailer orders have declined for November as compared to October. A cautious approach to truck ordering is likely connected to the decline in trailer sales, according to leaders of both research organizations. FTR Transportation Intelligence reports that preliminary trailer orders for November is at 20,200 units, with is a 34% decrease from October, as fleets are becoming more cautious about freight conditions in 2020. On a year-over-year comparison, orders were also down 55% from November 2018, when limits on OEM capacity resulted in carriers placing huge orders to lock in build slots throughout 2019.  Trailer orders for the last twelve months total 215,000 units. “Fleets are being more cautious with their truck orders, so it makes sense that trailer orders would follow suit,” said Don Ake, FTR vice president of commercial vehicles. “There is no reason to order in large quantities like last year. The supply of trailers has almost caught up with the demand for trailers, so ordering levels are flattening out and fleets are watching the market closely. There is still too much uncertainty regarding the economy, trade, tariffs and politics for companies to have a great deal of confidence right now for 2020.” OEMs have plenty of capacity to handle a more stable freight and trailer demand environment in 2020, so fleets are placing smaller orders and only ordering a few months out. Production continues to fall moderately on a per-day level, as freight growth has stalled. There is still a decent demand for dry vans and reefers, but the vocational segments, especially flatbeds, continue to weaken. “It is expected that orders will track in this range for a while, as fleets continue to place modest-sized orders for short-term needs,” Ake said. “OEM lead times are much shorter than a year ago, so ordering patterns will be much different, and more stable, than last year’s cycle.” ACT Research’s preliminary estimate for November indicates that trailer manufacturers booked 19,500 net orders to their order boards last month, which is a 39% decline from October’s volume. Activity was 56% below November of 2018, while year-to-date net orders are just under half that of last year. “The sequential decline in November broke a four-month streak of monthly gains,” said Frank Maly, Director of CV Transportation Analysis and Research at ACT Research. “That ran counter to the industry’s normal order patterns, which point to November typically ranking as the best order month of the year.” Before accounting for cancellations, new orders of 21,100 trailers were off 43% month-over-month and 54% below last year. Although a final volume report is not yet available, this preliminary market estimate is expected to be within +/- 3% of the final order tally. “The cautious stance toward 2020 cap-ex spending is evident in both the level and pattern of fleet trailer orders as we approach year-end,” Maly said. In this data, however, a decrease in cancellations for November as compared to the month before is a positive indicator for the year to come. “One positive take-away from the November stats is a significant easing in cancellations compared to previous months,” Maly said. “That’s an indication that, while lower, the commitments on the order board appear to be firming as we close the year. Discussions with trailer OEMs also indicate that, although they are encountering pricing pressure, quote activity remains solid, so any change in fleet confidence could quickly result in an order rebound.”      

One sure way to increase profits is understanding in and outs of fuel surcharge

For many truck owners, independence means freedom. When you own your own tractor, you can go for the bigger engine. The dual exhaust. The long hood and the fancy chrome bumper. Truck owners have more freedom in how they choose to drive, too. Company idle standards don’t apply, and in many cases, neither do company speed limits. One advantage those carriers have with their plain vanilla tractors is that they can maximize fuel efficiency. That’s something that savvy truck owners should be thinking about, too. There are a lot of reasons why saving fuel is important to a small trucking business, but one you may not have thought about is maximizing fuel surcharge payments. Many drivers look at fuel surcharges as another line on their settlements without realizing that the payment can help them reduce their out-of-pocket per-gallon fuel cost. Every truck owner, whether operating under their own authority or leased to a carrier as an independent contractor, should be aware of the exact amount of the surcharge for each load. Many carriers accomplish this with a surcharge chart that allows each owner to determine the surcharge payment for each mile. These are usually based on average diesel fuel prices published each Monday by the U.S. Energy Information Administration (eia.gov/petroleum/gasdiesel/). As fuel prices rise and fall, so do fuel surcharges. It’s important to understand that carriers and shippers calculate fuel surcharges based on an average miles per gallon (mpg) figure. In simple terms, if the fuel surcharge is based on a fleet average of 7 mpg but your truck achieves more than the average, you’re generating additional revenue for your business. That’s because the surcharge amount is calculated based on trip miles – it doesn’t change based on your truck’s fuel consumption. When fuel prices are high and surcharges are at a peak, it’s possible to cut your out-of-pocket fuel cost in half, or even lower. Consider a 1,000-mile trip. If your truck achieves 7 mpg, you’ll burn 143 gallons of fuel. If the price of diesel fuel is $2.55, your fuel cost for that trip, at 7 mpg, would be $364.65. If you receive a fuel surcharge of $0.15 per mile, you’ll get $150.00 in fuel surcharge for that trip, reducing your fuel cost to $214.65. But, if your tractor achieves 9 mpg, you will only consume 111 gallons of fuel for the dispatch. At $2.55 per gallon, your initial cost would be $283.05, a savings of $81.35 from our example above. Subtract the $150 total fuel surcharge from $283.05 and you’ll get $133.05. That’s your final cost for the 111 gallons of fuel you burned on the 1,000-mile trip. That’s a fuel price of less than $1.20 per gallon. The secret to making fuel surcharges pay is getting better fuel mileage than the fleet average used to calculate the surcharge.. If you can increase your fuel efficiency, you’ll burn less fuel AND you’ll pay less for the fuel you burn. The higher the price of fuel, the greater the potential savings to the owner-operator. In fact, when fuel prices are highest, it’s possible to realize a final fuel cost of ZERO. Taking full advantage of surcharges, however, means adopting many of the practices of the larger carriers. Reducing speed and keeping idle time to a minimum can have a huge impact on fuel mileage. Out of route miles don’t generate revenue and they don’t generate fuel surcharge income, either. The most efficient route is usually the best one. Trucks with sloped hoods, wind fairings, low-profile tires and aftermarket aero treatments like flow-through mud flaps and hub caps will generally get better mileage. If you lease equipment to a carrier and you’ll be pulling their trailers, ask how the trailers are equipped for aerodynamics. Trailers that aren’t equipped with side skirts, undercarriage “scoops” or collapsible “tails” will require more fuel to pull, at your expense. When leasing to a carrier or signing an agreement with a customer, be sure you understand how the fuel surcharge is calculated, what it’s based on and when you’ll be paid. Unfortunately, some carriers can be very ambiguous about how the fuel surcharge is paid, so be careful about leasing equipment to a carrier who can’t clearly explain the surcharge. The fuel surcharge was developed to help carriers and shippers cope with fluctuating fuel prices. By understanding how it works and making it work to your advantage, you can add revenue to your bottom line.  

Winding down the year by talking about value of safety in trucking industry

Find the comment section of any news article about a traffic accident involving a truck and a smaller vehicle and you’ll discover it is filled with input from those determined to defend the honor of trucking and truck drivers. Someone will surely raise the point that 70% of the time (or 75% or 78.3%) the automobile driver is at fault. Another will claim that drivers of 4-wheelers frequently make hazardous maneuvers that truck drivers (and trucks) can’t react to in time. Undoubtedly, somebody will repeat the adage that none of us would have much if it wasn’t for trucks. Most of the comments will be true or at least have elements of truth in them. None of them will do anything to make the highways safer for a single person. So, as we’ve done in past Decembers in the pages of The Trucker, we’re going to wind down the year discussing your value of safety. When there’s a loss of life or a serious injury resulting from an accident, some people will get wrapped up in determining who was at fault. Once fault is established, then it’s time to decide on costs. Somebody pays for hospital bills, ambulance rides, vehicle repairs and sometimes repairs to roads and bridges. Values will be placed on missed time at work, missing limbs and even on lives lost. Somebody pays; it’s just a matter of who pays and how much. If you make your living behind the wheel of a truck, there’s only one question that matters: How can we prevent accidents from happening? When a life is lost in a traffic accident, does it really matter whose fault it was? Every driver wants to avoid accidents. Many are trained in various programs of defensive driving, but the true professionals want to make the roads safer for everyone – even the bad drivers everyone encounters. That’s why every driver’s value of safety is so important. A person’s values are the standards of behavior or principles that he or she holds. Our values are deeply rooted, often formed in our youth, and shaped by family, friends, religious beliefs and other factors. Values determine what is most important in our lives and in many cases who we are. Values don’t change easily, and some don’t change at all. Priorities are something else entirely. They can change, depending on need and circumstance. When you’re hungry, for example, finding a restaurant might be a priority. An hour later, something else is on the top of the priority list. That’s why making safety a “priority” isn’t good enough. Our driving decisions must be based on our values. When safety is only a priority, we check the phone to see who the text message is from before we decide if it’s important or it can wait. When safety is a value, on the other hand, we don’t read text messages while driving, period. A safety priority says we’ll drive at the speed limit unless the load is in danger of being late. If that’s the case, we’ll drive faster and cut corners to make up the time. A safety value means we’ll choose safety over timeliness. A safety priority says we’ll go a little long on driving hours because we’re almost home. A safety value means nothing trumps getting home safely, even if we need a break to do so. So, as the Christmas season creeps closer, take a moment to examine your attitude towards safety. Is it a value for you? Do you take pride in knowing that you not only avoid accidents, but you help prevent them by considering the impact your driving decisions have on other motorists? Here are some simple things that have a great impact on the probability you’ll be involved in a crash: Speed does kill: Slowing down gives you more time to react to hazards. Following distance: Over time, it’s easy to become complacent about following distance, inching closer and closer to the vehicle ahead. It’s a good idea to test yourself, counting off the seconds it takes for the nose of your vehicle to reach a point the vehicle in front has already passed. If you don’t have five to six seconds of following distance, you’re living on borrowed time. Sooner or later, you will be involved in a rear-end collision with the vehicle in front. Driving decisions: Very often, a driving decision isn’t as simple as “safe” versus “unsafe.” By considering the risks involved with each available option, you can make the choice providing the maximum benefit with the smallest amount of risk for everyone. Left turns are a great example. It’s easy to assume an oncoming driver will see your vehicle turning across their traffic lane and slow down before colliding. What if they don’t? Remain in control: In the left turn example, you can’t be sure what will happen if you put your faith in other drivers reacting as you might expect. You can remain in control by NOT making the turn in front of them. Absolutely, it may mean waiting longer for a bigger traffic gap, but it also means you’ll never have to say, “I thought they would stop…” As the year winds down, take some time to think about your value of safety and how it can apply to traffic situations. Remember that other drivers may not have your skillset—or your values. Your driving decisions should help protect them as well as yourself. After all, we all have a better Christmas when we make it home.    

New Class 8 truck sales drop to lowest point since February 2018

November sales of new Class 8 trucks dropped to the lowest point since February 2018, according to information received from Wards Data. According to Wards, manufacturers reported sales of 18,545 new trucks, a decline of 19.4% from October sales of 23,001. It was the second consecutive month of double-digit decline in sales as October sales were 18.6% under September numbers. On a year-to-year basis, sales declined 12.9% from November 2018 sales of 21,302 trucks. The declines are in line with the “substantial correction” in the 2020 market predicted in Transportation Digest, published by ACT Research in late November. For months, orders for new Class 8 trucks have lagged far behind sales as OEMs continued to reduce their build backlogs. Stagnant freight rates, the potential for recession and uncertainty over trade disputes with China and other international partners have resulted in some trepidation among potential buyers. Year-to-date sales of 253,266 have already eclipsed 2018 sales of 250,627 for the entire year. December sales will push the annual total higher and 2019 is already the second-best sales year of the century-to-date. It’s doubtful the total will reach the high-water mark of 284,008, established in 2006, given the current downward trend. Of the individual OEMs, only Kenworth, Peterbilt and Western Star saw sales increases in November compared to October numbers. International sales dropped a whopping 72.4%, primarily due to fluctuations caused by delivery dates. October Class 8 sales were unusually high, followed by a lower than normal November. Volvo sales declined as well, dropping 32.0% from October and likely for the same reason. Mack sales dropped a more reasonable 3.2% It will be interesting to see if December is, as is typical, one of the best sales months of the year or a continuation of the decline.    

Freight Transportation Service Index up 1.3% in October, BTS says

WASHINGTON — The Freight Transportation Services Index (TSI) that is based on the amount of freight carried by the for-hire transportation industry, rose 1.3% in October from September, up after a one-month decline, according to the Department of Transportation’s Bureau of Transportation Statistics’ (BTS). From October 2018 to October 2019, the index rose 0.5% compared to a rise of 6.8% from October 2017 to October 2018. The level of for-hire freight shipments in October at 138.6 was exceeded by three previous months and was 1% below the all-time high level of 140.0 in August 2019. Records date back to 2000. The September index was revised to 136.8 from 136.6 in last month’s release.  Monthly numbers for June through August were 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 October TSI was broad based with increases in trucking, water, pipeline and air freight. Both rail carloads and rail intermodal declined. The TSI increase took place against a background of mixed results for other indicators. The Federal Reserve Board Industrial Production Index declined in October, reflecting decreases in all major industry groups. Personal income increased by less than 0.1%, while housing starts increased by 3.8%. The Institute for Supply Management Manufacturing index increased 0.5 points to 48.3, indicating contraction in the manufacturing sector but not as much contraction as in September. The Freight Index’s 1.3% increase in October was the largest one-month Freight TSI increase since September 2018. Following a decrease of 2.3% in October, TSI was 1.0% below its record high of 140.0 in August. However, it remained above any level it had reached before the high of November 2018 and in all but one month prior to January 2019. The Freight TSI rose 15.8% from 120 in March 2016 to a level of 139.0 in November 2018, but has been essentially stable (declining by 0.3 %) since then. The October 2019 index was 46.2% above the April 2009 low during the most recent recession. For-hire freight shipments measured by the index were up 1.9% in October compared to the end of 2018. As for the long-term trend, for-hire freight shipments are up 13.3% in the five years from October 2014 and are up 40.4% in the 10 years from October 2009.

ACT Research: Likelihood of heavy vehicle market recovery in 2020 tempered

COLUMBUS, Ind. —  According to ACT’s latest release of the North American Commercial Vehicle OUTLOOK, expectations for the Class 8 and trailer production volumes have been trimmed for 2020, and expectations of a recovery starting in 2021 have been tempered. Meanwhile, ACT’s December installment of the ACT Freight Forecast, U.S. Rate and Volume OUTLOOK report covering the truckload, intermodal, LTL and last mile sectors came with this headline: “Freight forecast: Lowering truckload spot rate forecasts on freight demand; what could drive rates up in 2020?” As for the tempered Class 8 outlook, ACT President and Senior Analyst Kenny Vieth pointed to three factors. “Broadly, there are three components to the forecast cuts for 2020 and 2021: Supply, demand, and timing,” Vieth said. “Some, like overcapacity, have been on the radar for a long time. Others, like the growing weakness in manufacturing and the broader economy, have come on slowly and inexorably over several months. The past six months have been marked by a continued loss of traction in manufacturing. Despite the GM-impacted payroll increase in November, most recent evidence from the sector suggests that recovery is likely to come later, rather than sooner.” The North American Commercial Vehicle OUTLOOK is a robust report that forecasts the future of the industry, looking at the next 1-5 years, with the objective of giving OEMs, Tier 1 and Tier 2 suppliers, and investment firms the information needed to plan accordingly for what is to come. The report provides a complete overview of the North American markets, as well as takes a deep dive into relevant, current market activity to highlight orders, production, and backlogs, shedding light on the forecast. Information included in this report covers forecasts and current market conditions for medium and heavy-duty trucks/tractors, and trailers, the macroeconomies of the US, Canada, and Mexico, publicly-traded carrier information, oil and fuel price impacts, freight and intermodal considerations, and regulatory environment impacts. As for the freight forecast, Tim Denoyer, ACT Research’s vice president and senior analyst, said, “This is the largest year-over-year drop in container imports since the Great Recession, aside from holiday timing. While partly because of the comparison against pre-tariff inventory building last year, we see evidence that trade issues will continue to drag the freight cycle through the mud. We’ve been forecasting a lengthy freight recession, but October imports, down 8% year-over-year, and fourth quarter rail volumes, down 7% year-over-year, are missing low expectations. In addition to a turn for the worse in our Spot Leading Indicator, this led us to modestly lower our spot rate forecasts for the first half of 2020.” ACT Research also lowered Class 8 tractor sales forecasts today, supporting the beginning of the bottoming process for truckload rates, and this month’s report provides analysis of the factors that could pull forward the eventual rate recovery, from both a spot and a contract perspective. “We expect capacity to rebalance over the course of 2020, but we caution not to jump to the conclusion that capacity is tightening because of carrier failures,” Denover said. “While our thoughts go out to the affected employees, even the largest bankruptcy in truckload history this week accounts for just 0.2% of the active fleet, or about 3% of the Class 8 tractor capacity that was added over the past year, and the equipment will be remarketed.”

California AB5 rule could spread to other states, executive warns

ST. PETERSBURG, Fla. — The CEO of a company that designs and manufactures virtual simulators for driver training says to watch out — other states will likely follow California’s lead and pass legislation that would limit companies’ ability to classify workers as independent contractors rather than employees. For the trucking industry, said John Kearney, CEO of Advanced Training Systems, that means that the law, known as AB5, denies California-based owner operators the ability to work as independent self-employed drivers who profit from their own vehicles and set their own schedules. “This legislation is well-meaning,” Kearney said. “It addresses some real issues in today’s labor economy, but applying it to the trucking industry, however, would be neither useful nor helpful.” The law takes effect January 1, 2020. Other states, Kearney warned, are also considering measures aimed at worker reclassification. A bill pending in the New Jersey legislature would reclassify virtually all workers in the state as regular employees. A coalition of labor groups is pursuing similar legislation in New York, and California’s example could encourage the revival of failed attempts in Washington State and Oregon. New York City adopted a minimum wage for ride-hail drivers working for companies like Lyft and Uber but did not classify them as employees. The new California law specifies an “ABC” test to determine a worker’s status. Workers will be classified as employees if they: (A) Perform tasks under a company’s control; (B) Do something integral to the company’s business; (C) Do not operate an independent business in that trade; As such, Kearney said, he or she is entitled to the area’s prevailing minimum wage, worker’s compensation, unemployment insurance, expense reimbursement, paid sick leave and paid family leave. In addition, the employer is required to pay half of the employee’s Social Security tax. The California Trucking Association and two California independent owner-operator truck drivers Tuesday filed an amended complaint with the U.S. Southern District Court seeking declaratory and injunctive relief against AB5, which was passed by the California Legislature and signed into law on September 11 by Gov. Gavin Newsom. The trucking industry, Kearney said, is structured in such a way as to make the ABC test a poor fit. The U.S. has approximately 3.5 million truck drivers, the vast majority of whom are local and short-haul drivers already classified as employees. There are also, however, approximately 350,000 independent business persons who own and operate their own trucks and whose businesses are based on contracting — usually with trucking companies — to make long-haul, full-truckload runs. As plaintiffs in the AB5 case have pointed out, about 70,000 of these people are based in California and have made it clear that they do not want their businesses disrupted, Kearney said. He said the California law, if applied to truck drivers, may be in violation of the Federal Aviation Administration Authorization Act of 1994, which bars states from enacting or enforcing laws affecting the transportation of property by motor carrier. “Trucking,” says Kearney, “is essential to the U.S. economy — it’s how we move over 70 percent of all goods sold. The industry is currently struggling with a severe shortage of drivers, especially drivers willing and able to make the long-haul runs that keep American commerce functioning. To attract and retain the new drivers we need, the industry is changing rapidly. Issues of employment status and compensation are of course arising as part of these changes, and are being addressed; shotgun legislation like California’s AB5 would simply be a distraction from that effort. What trucking needs today are solutions, not more problems.”  

November Port of Savannah shows 5.4% increase over same month in 2018

SAVANNAH, Ga. —  The Port of Savannah moved 363,000 twenty-foot equivalent container units in November, a 5.4% increase over the same month last year, or an additional 18,460 TEUs. For the fiscal year to date (July-November), the Georgia Ports Authority has handled nearly 2 million TEUs, an increase of 109,000 TEUs, or 5.8%. The positive numbers achieved last month mean Savannah’s Garden City Terminal has marked year-over-year increases for five consecutive months, and 34 out of the past 36 months. “After nearly three full years of cargo growth, with dozens of monthly records, it is frankly surprising to see our numbers continue to grow upon such a large base,” said GPA Executive Director Griff Lynch. “The streamlined movement of containers from vessel to departing rail in 24 hours and capacity increases built into Garden City Terminal have helped to increase volumes and improve efficiency.” GPA Board Chairman Will McKnight said that the authority’s Mid-American Arc initiative, targeting markets from Memphis, Tennessee, to Chicago and the Ohio River Valley, is also starting to pay dividends with customers moving more cargo in direct shipments from Savannah to the Midwest. “Chicago plays such an important role in the nation’s logistics, not only as a major market, but also as a cargo hub,” McKnight said. “Breaking into that market with a new routing option that provides Savannah’s world-class terminal efficiency and customer service holds amazing potential to win new business. With all the opportunities before us, it’s a great time to be a Georgian.” In Roll-on/Roll-off traffic, Colonel’s Island at the Port of Brunswick and Ocean Terminal in Savannah moved a combined 62,146 units of cars, trucks and heavy equipment in November, an increase of 5 percent, or 2,850 units. GPA has handled 281,547 Ro/Ro units, up 2,030 units or approximately 1%, through the first five months of the fiscal year. Georgia’s deepwater ports and inland barge terminals support more than 439,000 jobs throughout the state annually and contribute $25 billion in income, $106 billion in revenue and $2.9 billion in state and local taxes to Georgia’s economy. The Port of Savannah handled 8.5% of U.S. containerized cargo volume and 10 percent of all U.S. containerized exports in FY2017.                    

If Clark Griswold decorated a semi truck

If you have ever watched National Lampoon’s Christmas Vacation, you know the famous scene where Clark Griswold puts so many Christmas lights up, he knocks the power out. Well…this trucking company is certainly feeling the Christmas spirit. Do you have a rig decked out for the holidays?  Send us a video to [email protected] Courtesy: Transfast Trucking

Dart Transit names Dave Ables as new president & CEO

EAGAN, Minn. — Dart Transit Co., in its 85th year as a nationwide transportation service provider, has appointment of Dave Ables as the company’s new president and CEO. Chosen through an extensive national search process that was overseen by Dart Chairman Donald G. Oren, Ables will be responsible for directing the day-to-day operations of Dart. He will lead Dart’s management team, and report directly to Oren, who will continue his daily involvement in the overall operation of the company that the Oren family has owned since its founding in 1934. Ables brings 25 years of transportation experience to his new position at Dart, serving in executive leadership positions for the past six years with truckload carrier PAM Transport. Prior to his appointment with Dart, Ables was vice president of operations & marketing for all 13 operating divisions at PAM Transport. “We focused our search on finding an executive leader with the right depth and breadth of experience within all of Dart’s markets and facets,” Oren said. “In Dave Ables, we found the right person who possesses the full range of skills and values needed to continue to move our organization forward. Over his career in transportation, Dave has established an impressive track record of success, and I am confident that Dave will bring valuable insights and innovative approaches that will benefit our entire organization and all our customers. In reviewing his experience and during the interview process, we were particularly impressed with the leadership Dave has exhibited within the truckload market, and his ability to work well with employees, owner-operators, customers and the community alike. In our view, he has the right mix of experience working with all aspects of operations, customer service and sales, and he will be a high-quality leader for Dart.” In addition to his time with PAM, Ables held truckload leadership positions with other major carriers including Barr-Nunn, CRST and Stevens Transport. Oren and the Dart management team also took note of Ables’ prior experience in other key areas of business currently offered through the Dart Network. In serving as the Retail Supply Chain Practice Leader for Ohio’s Global Executive Solutions, Ables oversaw strategic sourcing, global purchasing, network optimization and a variety of logistics functions. Outside of trucking, Ables has been the managing member of his family-owned hardware store as well as other small businesses. “Dave’s expertise in logistics and supply chain solutions, along with his experience as a business owner and entrepreneur, will serve him well as the president and CEO of our company,” Oren said  “Between his wide range of career experience and the insights he shared with us, we found that Dave is an ideal fit for Dart and its variety of services, including logistics and intermodal services. “My wife Bev and I, along with our children, David, Daniel, Bradley and Angela, are very proud of what we’ve built together at Dart, and we couldn’t be more excited to bring Dave Ables in to be Dart Transit’s president and CEO and next successful leader,”  Oren said. “We are looking forward to working with Dave in the years ahead as our entire organization stays focused on being the best service provider in the business for drivers, owner-operators, employees, technicians and customers alike.” Ables and his wife, Lori, both have family ties to the Midwest, growing up in Iowa where Ables attended the University of Northern Iowa. They are the parents of three sons, David, Samuel and Nicholas.

FTR, ACT Research report disappointing November Class 8 order results

The two companies known for their collection and analysis of trucking industry information reported a drop in Class 8 orders. FTR reported preliminary North American Class 8 orders for November at a “disappointing 17,300 units, down 21% from October.” It was the lowest November total since 2015 and was 39% lower than the same month a year ago, FTR said. ACT Research noted that North American Class 8 orders failed to sustain momentum created in October. ACT Research Preliminary North America Class 8 net order data show the industry booked 17,500 units in November, down 20% from October, FTR said fleets remained extremely cautious heading into 2020, placing small orders and not extending orders much beyond the first quarter.  A couple OEMs reported decent order activity, but total orders fell below expectations. Class 8 orders for the past 12 months have now totaled 180,000 units. “The fall order season has gotten off to a slow start. Freight growth has stalled from the high rates of last year,” said Don Ake, vice president commercial vehicles. “This is causing fleets to be much more measured in their ordering for 2020. There still will be plenty of freight to haul, so we expect fleets will continue to be profitable and to replace older equipment. However, there won’t be a need for much additional equipment on the roads.” Ake said there was still a great deal of uncertainty in the environment which is creating apprehension in the trucking industry. Manufacturing has receded for four straight months, slowing economic growth. The trade war and tariffs are destabilizing prices and supply chains. And the tumultuous political climate just adds to an uneasy mix. The industry thrives on stability, but we are now on a rocky road.” Tim Denoyer, ACT’s vice president and senior analyst, said the freight market downturn worsened in the past month and uncertainty surrounding trade and tariffs continue to weigh on truck buyers’ psyches. “With rising pressure on carrier profits from the combined impact of lower rates and the recent, rather sudden jump in insurance premia, recent events have not developed in the industry’s favor,” Denoyer said. “While private fleets continue to add capacity on the retail end, the market is increasingly heeding for-hire price signals and the stage is being set to right-size the fleet, bringing it closer to equilibrium with the work to be done.” For more information on FTR, visit www.ftrintel.com. For more information on ACT Research visit www.actresearch.net.