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Wednesday, October 14, 2020
Logistics Intelligence Brief
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Trucking

Rise in US spot market truckload rates slowing

The Journal of Commerce William Cassidy October 13, 2020

That is a 4.9 percent increase from August, when the average rate was $2.47 per mile, up 10.8 percent from the previous month. That followed increases of 18.6 percent in July and 15.3 percent in June. The average hit a low point of $1.63 per mile in May after dropping from $1.90 per mile in March “Spot market rates just keep climbing as companies turn to the spot market to help them manage imbalances in their supply chains,” Ken Adamo, chief of analytics at DAT, said in a statement Monday. “We’re seeing strong volumes across equipment types as the economy continues to recover, particularly in areas related to consumer spending.”  

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Amazon’s ‘Christmas Creep’ Poses Stress Test for FedEx, UPS

Bloomberg Thomas Black October 14, 2020

Large retailers -- who typically get volume discounts -- must be more flexible on schedules. FedEx and UPS, for example, have increased weekend capacity for pickups and delivery. Shippers will also be pressed to prepare trailer loads of packages for delivery. “It’s mostly large customers that will make those changes,” Maier said. “We’re making sure they understand where capacity is available in the network and on what days and what times, so we can do our best to fill their expectations at peak.” Small retailers, which don’t get the big discounts like large shippers, won’t be as affected by the tight capacity, he said. Maxing Out Preparations by FedEx and UPS notwithstanding, the shipping industry as a whole is nearly maxing out.

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Shippers/3PLs

Amazon Prime Days are expected to see its highest-ever volumes

Logistics Management Jeff Berman October 13, 2020

“It’s likely that 2020 Amazon Prime Day (actually spread over multiple days) will shift the traditional start of the holiday shopping season from Black Friday (day after Thanksgiving) to October 13,” he said. “That’s welcomed news for the carriers, spreading out holiday volumes over an extra month, taking pressure off already overburdened delivery networks. That said, Amazon has become a lot more self-sufficient handling its own deliveries.  It’s noteworthy that in 2019 Amazon reportedly delivered 1.9 billion packages through its in-house delivery network in the U.S. alone.  That’s 155% year over year growth, with a compound annual growth rate estimate of 30% through 2024.”  

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Industry

Air freight market throws quoting into chaos for forwarders

The Journal of Commerce Eric Johnson October 13, 2020

Air freight forwarders bidding for business on the online spot procurement platform Cargobase saw the rate of accepted quotes fall dramatically in the third quarter, to 30.5 percent from 53.3 percent in the second quarter, the Singapore-based technology provider said Tuesday. The sharp drop in accepted rates signifies the intensity of activity in the airfreight segment, but also highlights the degree to which some forwarders aren’t able to quote quickly enough to win business in that competitive environment.

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Trailer orders ‘exploded’ in September, FTR reports

Fleet Owner October 13, 2020

FTR reports that preliminary U.S. net trailer orders for September “exploded” to the third-highest month ever, at 52,000 units. September’s orders were 23,500 units above August and 33,400 more than September 2019. With this latest activity, trailer orders for the last 12 months now equal 224,100 units. The great majority of the September orders were for dry vans, according to FTR. Refrigerated van orders were also “comparatively” robust. Flatbed orders are expected to continue their sluggish recovery.

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Government/Safety

Truck drivers testing positive for drugs increased 8% in September

Freight Waves John Gallagher October 13, 2020

Positive drug tests and drug test refusals increased 8% and 9.3%, respectively, in September, after dropping slightly in August, according to the most recent data compiled by the federal Drug & Alcohol Clearinghouse. The latest monthly data, released Tuesday by the Federal Motor Carrier Safety Administration (FMCSA), also revealed that the number of drivers now in “prohibited status” — meaning they have at least one drug or alcohol violation and are still in the return-to-duty process — reached 34,156 as of Oct. 1. Roughly 78% (26,590) of those drivers, however, have not yet started the RTD process. “The month-on-month increase in the number of drug violations, including the increase in the number of positive drug tests, is pretty troubling,” David Osiecki, president and CEO of Scopelitis Consulting LLC, told FreightWaves.  

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Driving around the distractions

Fleet Owner Josh Fisher October 13, 2020

There is no multitasking “A lot of people will tell you that they don’t get distracted, that they can think about more than one thing at once, and that they can multitask. That is actually not true,” CarriersEdge CEO Jane Jazrawy told FleetOwner. “You can’t multitask. What you can do and what your brain does is just switch between things very, very rapidly. You’re not doing it simultaneously. You’re switching.” When a driver’s brain is switching between tasks, attention is diverted. “When you are driving, doing anything else that’s not driving can be a distraction,” she explained. “If you are using a phone, for example, that is the biggest distraction you can have. And the more distraction you have, the more likely you’re going to be in a collision.”  

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Trucking fatalities static despite safety tech developments

Transport Dive Jim Stinson October 13, 2020

The National Highway Traffic Safety Administration reported fatalities in crashes involving at least one large truck showed almost no change last year, decreasing from 5,006 in 2018 to 5,005 in 2019. A large truck is defined as weighing 10,000 pounds or more. Overall traffic fatalities for the first half of 2020 were at 16,650 people, down 2% from the first half of 2019, according to data released Oct. 1. 2019 was the third-consecutive year in which traffic fatalities declined after reaching a recent high of 37,806 in 2016, the NHTSA said. But deaths of large-truck occupants increased 0.2% to 892 deaths, from 890 in 2018. NHTSA's numbers are 2019 data from the Fatality Analysis Reporting System and preliminary estimates for the first half of 2020.  

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