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Tuesday, October 20, 2020
Logistics Intelligence Brief
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Trucking

COVID-19 Truck Freight Recovery Index

FTR Transportation Intelligence October 19, 2020

Dry Van: The Dry Van segment has not reestablished the clear upward trend that had held sway from early May until Labor Day. The latest reading is around 7% below the peak during the week ending September 4.  

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Brace for Holiday ‘Shipageddon’

The New York Times Shira Ovide October 16, 2020

Retailers are sweating over how they’re going to move merchandise among their stores and handle extra expenses to deliver orders. And people who rely on home delivery might need to plan ahead for possible bottlenecks. The potential for hiccups shows the complications when our zeal for shopping from home meets the physical limits of humans, warehouses stuffed to the rafters, roadways and ocean freight shipping. There’s always been a war to get stuff to our door. It’s just been one we usually ignore.

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There is nothing typical about this year’s holiday shopping and shipping for carriers and retailers

Logistics Management Jeff Berman October 20, 2020

As for the parcel duopoly of UPS and FedEx, the article explained that they think this year’s holiday season will stretch them “to the limits,” and added that have rolled out steeper fees for retailers this year, an in effort to reduce and discourage deliveries they cannot handle. In the event that is not painful enough, consider this takeaway from the WSJ, regarding UPS and FedEx: [they] have told some of their largest shippers that most of their capacity is already spoken for, and that any extra trailers with holiday orders will have to wait to be picked up, according to shipping consultants and retailers.” Ouch. But, wait, there is more. The article also observed that this situation leads retailers to secure capacity from smaller providers, but they are, too, full, capacity-wise and not able to bring on new customers until 2021.  

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Nightmare on parcel street opens historic window for regional carriers

Freight Waves Mark Solomon October 19, 2020

Beyond the holidays and even the COVID-19 pandemic, however, is a shift of epic proportions that could set the regionals’ course for years. According to interviews with carrier executives and industry consultants, FedEx and UPS, hungry for fatter margins as long as the supply-demand scales tilt in their favor, are forcing their largest shippers to accept double-digit contract rate increases or find delivery alternatives. UPS is also capping the volumes it accepts from big customers, and some of its long-standing shippers are being abruptly informed to shed 20% to 30% of their pre-peak traffic that they tender to the carrier, according to Metzler. Neither carrier “is trying to finesse” their actions, he said.  

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Industry

Peak season to test retooled supply chains

DC Velocity October 19, 2020

At the same time, the data shows that performance issues persist across the supply chain, particularly when it comes to having the resources needed to meet customers’ needs. Many survey respondents said they think this peak season will likely be less profitable, with more disruptions than 2019, as a result. 64% said they’ve dealt with more late or failed deliveries than what is typical. 59% of respondents said that they are concerned about not having the resources needed to meet peak customer demand, and almost half said they believe their peak season will bring in less revenue than last year.  

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Drayage shortage crimps supply chain amid quick demand recovery

The Journal of Commerce Ari Ashe October 19, 2020

When volume was at a low in the spring, trucking executives said they lost many drivers. Instead of riding out the downturn, they said older drivers decided to retire or take different jobs. “Demand is extremely high and since most carriers had cut back on hiring earlier this year and fewer new drivers have entered the market, a perfect storm has been created,” said Ben Banks, vice president of drayage provider TCW Inc. Kellaway said a great deal of drayage capacity left during the pandemic and it’s been hard to find new drivers. “Many of these drivers have not returned, and have elected to go to other industries or other sectors such as truckload, which is paying a very high premium at the present time due to capacity shortages,” he said.  

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Will the truck-as-a-service model replace Class 8 buys?

Transport Dive Amanda Loudin October 10, 2020

The servitization business model has taken hold seemingly overnight, especially on the consumer side. From Netflix to HelloFresh to Uber and everything in between, turning products into services is the way of the present. Next up: that same model applied to the industrial equipment sector. "The popularity of consumer servitization has paved the way for the industrial model," said Gary Brooks, chief marketing officer at Syncron, a software solutions provider.

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Government/Safety

Owner-operators opposing Teamsters in HOS lawsuit

Freight Waves John Gallagher October 19, 2020

Small-business truckers want to make sure their voices are heard when a federal appeals court takes up a challenge to the recently amended hours-of-service (HOS) regulations. The Owner-Operator Independent Drivers Association (OOIDA) on Friday filed a “motion to intervene” with the U.S. Court of Appeals for the District of Columbia Circuit in support of the Federal Motor Carrier Safety Administration (FMCSA), which is defending its rule changes from the challenge filed in September by the International Brotherhood of Teamsters and three safety groups. The Teamsters and the safety groups argue that FMCSA’s loosening of four HOS provisions — split sleeper-berth, 30-minute rest break, adverse driving conditions, and short-haul operations, which went into effect on Sept. 29 – will exacerbate driver fatigue and decrease safety.

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Four More Individuals Indicted in Staged Accidents Scam in La.

Transport Topics Eric Miller October 19, 2020

Four others have been indicted in connection with a sweeping federal investigation into staged accidents with commercial vehicles in the New Orleans area, amounting to 32 charged or pleading guilty in local accident scams since last year. The four new defendants were charged Oct. 16 with a three-count federal indictment — one count of conspiracy to commit mail fraud and two counts of mail fraud. If convicted, they face a maximum penalty of five years for count one and 20 years for counts two and three. After their release from prison, each of the participants face a $250,000 fine for each count and up to five years supervised released.

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Three trucking companies fined for violating CARB’s Truck and Bus Regulation

Land Line Tyson Fisher October 19, 2020

Roadrunner Transportation Systems must pay a $117,000 civil penalty and use compliant trucks moving forward. The trucking company did not have diesel particulate filters per the Truck and Bus Regulation. Also, Roadrunner operated unregistered and noncompliant drayage trucks. Furthermore, the company hired carriers to transport goods in California without verifying that the vehicles were in compliance, and dispatched drayage trucks without required record-keeping

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Regulatory Outlook: Trucking and the 2020 election

Fleet Owner October 19, 2020

The Trump administration, for instance, pulled the safety fitness rule off the table, and stopped both the trucking insurance limit rulemaking and sleep apnea ruling in their tracks. In addition, the administration focused on making commercial driver’s license (CDL) rules more driver friendly for those trying to obtain their CDLs. The Trump-led Department of Transportation (DOT) also developed the addition of the permanent crash preventability program under the Compliance, Safety, Accountability (CSA) program, and revised federal HOS rules to make these programs more business and industry friendly, explained Osiecki.

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FEMA launches 5-year supply chain plan for pandemic preparedness

Freight Waves Eric Kulisch October 14, 2020

The Federal Emergency Management Agency on Tuesday encouraged more companies to participate in a voluntary agreement to better coordinate manufacturing and distribution of critical health care products, such as personal protective equipment and pharmaceuticals, to combat COVID-19 and other pandemics during the next five years. The agreement enables private sector partners to more freely share information with the federal government, and across industries, and take  action in the public interest that would normally be prohibited by antitrust laws.  

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