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Logistics Intelligence Brief
Wednesday, July 21, 2021

Trucking

Yellow Company, Holland, Earns “Carrier of the Year” Honors

Yellow Corporation Press Release July 20, 2021

For 2020, during the height of the COVID-19 pandemic, Yellow Corporation (NASDAQ: YELL) operating company Holland received multiple “Carrier of the Year” honors from customers and shippers. “What’s incredible is the fact that, during a global pandemic and the most challenging year of our careers and in our industry’s history, our employees showed up in a big way for our customers, and these awards are a testament to them exceeding expectations on the job,” said Jason Bergman, Chief Commercial Officer for Yellow. “If Yellow can earn awards for excellence while navigating the tremendous obstacles COVID-19 fallout presented, I am excited to see what the future holds for the Company and our 30,000+ employees.”

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J.B. Hunt urges faster equipment turns for peak season (Subscription Based)

The Journal Of Commerce Ari Ashe July 20, 2021

Demand ‘bountiful,’ capacity is not Shelley Simpson, J.B. Hunt’s chief commercial officer, said “opportunities are bountiful,” but so are the challenges to serve customers. “Demand for our trucks, containers, and trailers far exceeds our capacity to serve,” she said on Monday’s call. “Improvements in customer detention or dwell time will go a long way in meeting or exceeding our customer expectations.” Simpson also addressed a letter the company sent to its shippers raising accessorial fees on dwelling containers and trailers. “Our intent was to provide the appropriate incentive to our customers to encourage the improvements needed to be able to turn our equipment efficiently,” she said. “This improvement will afford us to deliver more value to our customers by being able to provide additional capacity.”

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Capacity crunch prompts JB Hunt to limit service

Transport Dive Jim Stinson July 20, 2021

J.B. Hunt recently had to restrict capacity to certain customer locations because of demand outstripping resources, Shelley Simpson, chief commercial officer, said during an earnings call Monday. It's a situation similar to one an LTL competitor, FedEx Freight, found itself in during Q2. Detention of trailing equipment by customers in the intermodal and truck segments was one of J.B. Hunt's biggest obstacles, Simpson told investors. The challenge accelerated into Q2, Simpson said, and the carrier has had to discuss solutions with clients and make accessorial charges. Simpson said J.B. Hunt could meet capacity challenges for the remainder of 2021 by obtaining ordered equipment — containers and trailers — and by improving in rail velocity, customer detention and customer dwell time.

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Truck Tonnage Rises Slightly in June

Transport Topics Dan Ronan July 20, 2021

Truck tonnage in June inched up 0.5% compared with year-ago levels, a slowdown compared with recent months amid a tempering of freight activity nationwide, according to American Trucking Associations’ For-Hire Truck Tonnage Index. The index equaled 111.6 in June, ATA announced in a July 20 news release. When measured against May, the index decreased 1.5%. For purposes of the index, the year 2015=100. “Tonnage has definitely flattened out, on average, over the last six to nine months,” ATA Chief Economist Bob Costello said. “The good news is that it remains slightly above 2020 levels.” Costello noted, however, that there are some post-pandemic supply chain and economic challenges — some specific to trucking — that are limiting growth. “Supply chain issues are likely putting some downward pressure on tonnage,” he said. “But it is also likely that tonnage isn’t growing as much as it could because of industry-specific supply constraints. This index is dominated by contract freight, and the for-hire truckload carriers have seen their tractor counts fall because they are having difficulty finding qualified drivers.

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Workforce

Research Could Provide Window Into Driver Shortage

Transport Topics Eleanor Lamb July 20, 2021

Prior to the session, FMCSA Deputy Administrator Meera Joshi made a brief introduction to the committee members and emphasized the importance of getting a good understanding of the industry’s “factual foundation.” In terms of future research, Minor identified drivers with short-term medical cards as a subject area. Specifically, he said the agency is currently conducting research looking into what medical conditions these people are experiencing and if short-term medical card holders are overrepresented in crashes. MCSAC member David Heller, vice president of government affairs for the Truckload Carriers Association, recommended using data collected from electronic logging devices, such as driver detention time and speed information, as a resource to better understand issues.

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Driver Shortage Linked to Lifestyle Considerations, Costello Says

Transport Topics Eleanor Lamb July 20, 2021

The persistent truck driver shortage is a complicated issue that is tied in part to quality-of-life considerations, according to American Trucking Associations Chief Economist Bob Costello. Costello reported the trucking industry needed an additional 60,800 truckers in 2018, a shortfall that is expected to grow to 105,000 drivers by 2023 unless recruitment efforts improve. Costello delivered a presentation at the Federal Motor Carrier Safety Administration’s Motor Carrier Safety Advisory Committee meeting on July 20. He identified various factors that are exacerbating the driver shortage, ranging from lifestyle issues to the pandemic’s limiting effect on departments of motor vehicles and driver schools. Anecdotally, he said he hears from fleets that companies can pay drivers less as long as they get them home every other night.

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Shippers/3PLs

2021 Shipper of Choice profile: Walmart

Freight Waves July 20, 2021

Working through supply chain challenges The pandemic put years of investment in Walmart’s supply chain to the test as sudden spikes in demand for many household essentials resulted in sold-through inventory positions. Acknowledging the merchandise constraints during 2020, Walmart increased its annual capital expenditure plan to $14 billion for 2021, almost a 40% increase. The increase in spending is aimed at many supply chain initiatives in the U.S., including a demand-predicting supply chain engine, facility automation and fulfillment capacity. The heightened level of capital investment is expected to continue through the next couple of years. “The big thing that we’re doing is creating capacity to be able to serve more and to begin work on market fulfillment centers, where we can use locations as hubs for other stores and spokes,” John Furner, president and CEO of Walmart U.S., told analysts on a recent call. “We’ve got a lot of really encouraging supply chain work going on that would help us use the right algorithms to be able to pull inventory from all across the network and be able to serve people.”

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Walmart plans to automate 25 distribution centers with Symbotic

Supply Chain Dive Matt Leonard July 20, 2021

Walmart will work with Symbotic over a period of years to outfit 25 distribution centers with an automated end-to-end process for store-level replenishment, the companies announced last week. Symbotic's system automates the processing of inbound shipments, storage, retrieval and outbounding of orders. It uses robotics and machine vision to break down pallets, store them at a case level and then build orders for Walmart stores as needed. Through its work with Symbotic, Walmart aims to improve the storage density, pallet density, throughput as measured in cases per hour, system availability and order accuracy of its replenishment system.

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‘There’s nothing like it out there’: Dollar General’s Popshelf aims to create and conquer a new market

Retail Dive Ben Unglesbee July 20, 2021

Dollar General has long been courting customers in higher income ranges than its traditional base. Popshelf is an entire concept devoted to a market outside of Dollar General's core. As such, it is a first not just for Dollar General, which opened its first store in 1955, but in many ways a first for the entire sector. "From Dollar General's perspective, they saw an opportunity in the market that's being underserved," said Joseph Feldman, retail analyst and assistant director of research with Telsey Advisory Group. "I hear this a lot from the dollar stores or value-oriented retailers, that there's a number of great products out there if you could go upscale a little bit, higher than what you normally do in your core store." Between October and May, Dollar General opened its first eight Popshelf stores, which are around 9,000-square-feet each. The performance of those stores "far exceeded our expectations," Chief Operating Officer Jeff Owen said in Dollar General's most recent earnings call.

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Government/Safety/Sustainability

DeFazio Blasts Bipartisan Senate Infrastructure Plan

Bloomberg/Transport Topics Keith Lang July 20, 2021

Rep. Peter DeFazio blasted the Senate’s bipartisan infrastructure deal, saying there are “extraordinary deficiencies” in the plan that is backed by President Joe Biden. DeFazio, the Democratic chairman of the House Transportation and Infrastructure Committee, said July 20 during a press conference organized by Advocates for Highway and Auto Safety that the Senate plan is “essentially status quo on safety, and status quo on highway building and will not deal with fossil fuel pollution and carbon reduction.”

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Infrastructure Deal in Peril as GOP Threatens Filibuster

Associated Press/Transport Topics Lisa Mascaro And Kevin Freking July 20, 2021

The bipartisan infrastructure deal senators brokered with President Joe Biden is hanging precariously ahead of a crucial July 21 test vote as senators struggle over how to pay for nearly $1 trillion in public works spending. Tensions were rising July 20 as Republicans prepared to block the vote, mounting a filibuster over what they see as a rushed and misguided process. With Biden preparing to hit the road to rally support for his big infrastructure ideas — including some $3.5 trillion in a follow-up bill — restless Democrats say it’s time to at least start debate on this first phase of his proposals.

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