Business

NASHVILLE — Estes Express has offered a bid of $1.3 billion for bankrupt Yellow Corp’s shipping terminals, according to attorneys at an Aug. 17 hearing in U.S. bankruptcy court. Instead of accepting Estes’ initial offer to provide a loan as part of its bid, Yellow is instead receiving a loan from Citadel and MFN Partners, according to financial reports. If Yellow accepts Estes’ bid, Estes will own more than 270 terminals. Yellow also plans to sell its tractors and trailers, which are not part of the Estes deal. Yellow has 180 days to entertain higher bids for its real estate assets and fleet of trucks.

WASHINGTON — An affiliate of investment firm Citadel has acquired around $485 million in Yellow Corp. debt from Apollo Global Management, according to a report in the Financial Times. Yellow is currently seeking a bankruptcy loan to fund liquidation. The Chapter 11 bankruptcy, which was filed Aug. 6, comes just three years after Yellow received $700 million in pandemic-era loans from the federal government. While a Chapter 11 filing is used to restructure debt while operations continue, Yellow, like other trucking companies in recent years, will liquidate and the U.S. will join other creditors unlikely to recover funds extended to the company. Yellow fell into severe financial stress after a long stretch of poor management and strategic decisions dating back decades. In 2019, two trucking companies, Celadon and New England Motor Freight, filed for bankruptcy protection and liquidated. The case is Yellow Corp. 23-11069, US Bankruptcy Court District of Delaware

ST. LOUIS — The latest freight numbers from the Cass Freight Index show that shipments fell 2.2% month-over-month in July and 1.2% month-over-month in seasonally-adjusted terms. The index showed that July volumes were on par with January in absolute terms, despite 10% stronger seasonality. On a year-over-year basis, the index was 8.9% lower in July, after a 4.7% decline in June. “The freight market downcycle is now 19 months old, which compares to a range of 21 to 28 months in the past three downcycles,” according to a Cass news release. “Declining real retail sales and destocking remain the primary issues, but dynamics are shifting as real incomes improve and the worst of the destock is in the rearview.” In seasonally-adjusted terms, the index is now 13% below the December 2021 cycle peak, slightly greater than the peak-to-trough declines in two of the three downcycles in the past dozen years. “With normal seasonality, this index would increase slightly month-over-month in August but decline about 11% year-over-year, comparing to the extraordinary time last summer when destocking was actually creating freight demand as retailers were shipping out stale inventory,” the news release stated. “Even adjusting for the strange comparison, this will probably overstate the pressure on national freight volumes because the for-hire market is losing share to private fleets.” The expenditures component of the Cass Freight Index, which measures the total amount spent on freight, fell 2.8% month-over-month and 24.4% year-over-year in July. “With shipments down 2.2% month-over-month in July, we infer rates were down 0.6% month-over-month,” the news release stated. On a seasonally-adjusted basis, the index declined 2.0% month-over-month, with shipments down 1.2% and rates down 0.8%. This index includes changes in fuel, modal mix, intramodal mix and accessorial charges. The expenditures component of the Cass Freight Index rose 23% in 2022, after a record 38% increase in 2021, but is set to decline about 18% in 2023, assuming normal seasonal patterns from here, Cass officials noted. Both freight volume and rates remain under pressure at this point in the cycle, but fuel price increases could limit the savings for shippers. Cass Inferred Freight Rates decreased 0.8% month-over-month (seasonally-adjusted) after a 0.9% decline in June, as contract rates continued to reset lower. “Based on the normal seasonal pattern, this index would decline slightly m/m in August, and the year-over-year decline would remain about 17%,” according to the news release. “We estimate lower fuel prices are knocking about 5% off freight rates y/y, and while fuel is a big factor, there’s clearly also still market pressure on rates.” The Cass Truckload Linehaul Index, which measures changes in linehaul rates only, fell 0.2% month-over-month in July to 142.0, after a 0.4% month-over-month decline in June. “The slower decline in the past two months likely reflects a combination of slightly higher spot rates and smaller declines in contract rates,” according to the news release. On a year-over-year basis, the Cass Truckload Linehaul Index fell 12.7% year-over-year in July, after a 14.1% year-over-year decline in June. Freight expectations “We’ve been citing the key factors behind the freight downturn — substitution and inventory — for well over a year, but it’s not all macro factors,” the news release stated. “One key and likely underappreciated industry-specific factor is the rapid growth of private fleets. The publicly traded for-hire truckload fleets reduced their collective tractor count by 3% in 1H’23 and operating authority revocations remain elevated, so for-hire capacity is contracting quickly.” However, Class 8 tractor production is still at maximum levels, growing the overall fleet, and consequently keeping downward pressure on spot rates. Private fleets represent more than half of Class 8 tractor capacity, and “we believe their growth is pulling freight out of the for-hire market, prolonging the industry downturn,” the news release stated. “Though significant progress has been made in rebalancing, we think it’s unlikely that industry capacity will broadly tighten until pressure from private fleet growth eases, which looks unlikely this year. Though the freight market is still near the bottom of the cycle, the first step in getting out of a hole is to stop digging. New truck orders in the next few months will be very interesting and, in our view, will be pivotal to setting the market tone for 2024.”

BLOOMINGTON, Ind. — Lower broker-posted rates in the Truckstop system during the week ended Aug. 11 were mostly responsible for a decrease in flatbed spot rates, according to the latest Truckstop report. Dry van spot rates barely changed, edging up by a fraction of a cent, while refrigerated rates eased more than a cent after the prior week’s robust gain. Refrigerated spot rates exceeded flatbed rates for the second straight week after trailing for all but one week since early January. Dry van spot rates have not exceeded flatbed rates since early 2022. Loads available Total load activity declined about 6% after rising 4% in the previous week. Volume was more than 22% below the same week last year — the least negative year-over-year comparison in more than a year — and about 26% below the five-year average for the week. Load activity was lower week over week in all regions. Truck postings increased 1.3%, and the Market Demand Index — the ratio of loads to trucks — fell. Total rates The total broker-posted rate decreased 3 cents after rising slightly more than that in the prior week. Rates were about 15% below the same 2022 week, which is the least negative year-over-year comparison since late last year, and were nearly 5% below the five-year average. The rate decrease follows seasonal expectations for total market rates, which tend to decline gradually between late June and Labor Day. Dry van  Dry van spot rates ticked up half a cent after rising more than 4 cents during the previous week. Dry van rates were nearly 13% below the same week last year and nearly 9% below the five-year average. The year-over-year comparison in rates was the least negative since July of last year. Dry van loads fell 5.3% after increasing about 1% in the prior week. Loads were up in the Midwest but down in all other regions. Volume was nearly 14% below the same 2022 week and almost 19% below the five-year average. The year-over-year comparison once again was the least negative in more than a year. Reefer Refrigerated spot rates eased 1.4 cents after rising more than 11 cents during the prior week. Rates were nearly 11% below the same 2022 week for the least negative year-over-year comparison since May 2022. Refrigerated rates were nearly 6% below the five-year average. Refrigerated loads fell 8.1% after rising more than 14% in the previous week. Loads were up in the Mountain Central region but down elsewhere. Volume was more than 13% below the same week last year and 17% below the five-year average for the week. Flatbed Flatbed spot rates decreased more than 3 cents after easing 1 cent during the previous week. Rates, which have fallen in nine of the past 11 weeks, were nearly 18% below the same 2022 week and about 3% below the five-year average. Flatbed loads fell 6.9% after rising nearly 3% in the prior week. Loads were down in all regions. Volume was about 35% below the same week last year and about 41% below the five-year average for the week.

COLUMBUS, Ind. — Preliminary Class 8 same dealer used truck retail sales volumes contracted 4.4% in July, according to the latest preliminary release of the State of the Industry: U.S. Classes 3-8 Used Trucks published by ACT Research. Compared to June 2023, average retail price declined 4%, while miles and age both declined 2%, according to ACT. Compared to July of 2022, volumes improved by 34%, while price declined 28%, miles declined 4%, and age declined 9%. According to Steve Tam, vice president at ACT Research, “Following three months of being bookended, retail sales handily outsold auctions and wholesalers.” He continued, “Auction activity pulled back 48% month-over-month from its usual end-of-quarter spike. Dealers increased their conservatism in July, with wholesale transactions down 36% month-over-month in July. In total, the used truck industry saw preliminary same dealer sales fall 31% month-over-month.” Tam concluded, “Historically, July is the fourth slowest sales month of the year, about 5% below average, pretty much explaining all the losses the industry experienced in June.”

LOWELL, Ark. — J.B. Hunt Transport Services Inc. has published a report detailing the company’s progress toward environmental, social and corporate governance performance. “In 2022, we celebrated some incredible achievements by addressing challenges with energy and creativity while positioning our organization for long-term growth opportunities,” said John Roberts, CEO of J.B. Hunt. “Looking ahead, we remain eager to follow through on our commitments and goals to deliver on our mission to create the most efficient transportation network in North America.” Highlights from the report are listed below. Reducing carbon emissions The company announced in 2022 that it was “setting an ambitious goal to reduce carbon emission intensity 32% by 2034 (with a 2019 baseline),” the report noted. Specifically, J.B. Hunt officials are focusing on three areas to reach their emission-reduction target: incorporating alternative powered equipment into its fleet; expanding the use of biogenic fuels; and improving fuel economy (diesel powered miles-per-gallon “MPG”). “Achieving the company’s ambitious target is dependent on significant progress with the development and availability of new industry technology and the infrastructure needed to safely enable their day-to-day use on an industry-wide scale,” according to the report. J.B. Hunt also converts over-the-road highway freight to rail intermodal, which it says reduces a shipment’s carbon footprint by an average of 60%. J.B. Hunt operates with more than 116,000 53-foot containers supported by company-owned chassis and tractors, with plans to expand to as many as 150,000 containers in the next two-to-four years, the report noted. In 2022, company officials said they avoided an estimated 3.6 million metric tons of CO2e emissions by converting over-the-road loads to intermodal. It also helped company drivers avoid an estimated 3.5 million empty miles through J.B. Hunt 360, its multimodal digital freight marketplace. Powered by a people-focused culture “J.B. Hunt considers an inclusive workplace essential to fostering company growth and innovation,” according to the report. “Throughout 2022 and 2023, J.B. Hunt has earned several national recognitions for its people-focused culture, including three from Newsweek for its efforts to advance diversity, women and job starters.” The company hosts six overall employee resource groups (ERG), with a collective total of 5,000-plus ERG members, that provide support networks for female, LGBTQIA+, veteran, Latino, African American and Asian American and Pacific Islander employees and “promotes a sense of belonging for everyone,” the report notes. Advancing supply chain education After J.B. Hunt’s five years of continuous support to the University of Arkansas, in August 2022, the Sam M. Walton College of Business Program for Supply Chain Management was named as the J.B. Hunt Transport Department of Supply Chain Management. Through a new $1.5 million commitment to Sam M. Walton College, “the company aims to advance innovative, supply chain-focused initiatives, studying factors such as inclusion, sustainability, thought leadership, education, and innovation,” according to the report. “It will also support research, internships, scholarships and case competitions in supply chain management.” In 2022, J.B. Hunt awarded a total of $250,000 in scholarships to 100 recipients as part of the company’s new scholarship program, the J.B. Hunt Scholarship Program for Families. The application-based scholarship program is available to dependent children or grandchildren of J.B. Hunt employees who currently attend or plan to attend an accredited two or four-year college, trade school or vocational school. The company continued the program in 2023, and a new class will be announced later this year. Additional achievements J.B. Hunt was one of the first industry carriers to publish a Sustainability Report in 2020. Additional highlights from the latest report reflect the company’s investment in core foundation areas and include: Increasing usage of biogenic fuels by 6.9 million incremental gallons in company assets. Creating the J.B. Hunt Inclusion Office and Inclusion Council to ensure that inclusion remains a key component of creating exceptional employee experiences. Taking delivery of the first company-owned Class 8 electric Freightliner eCascadia truck and incorporated it into operations. Celebrating the second and third company drivers who achieved five million safe miles driven. Representing drivers at the U.S. Department of Labor Hall of Honor induction ceremony recognizing all essential workers for their dedication during the COVID-19 pandemic. “By continuing to invest in our people, technology and capacity, we are creating a strong company that delivers for our customers and communities,” said Shelley Simpson, president of J.B. Hunt. “Developing an inclusive culture is what fuels our innovation and positions us to best serve the diverse world in which we operate.”