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Logistics Intelligence Brief
Tuesday, September 14, 2021


Cass Transportation Index: Trucking Picking Up Slack; Costs Continue to Rise

Cass Transportation Systems September 13, 2021

Cass Freight Index - Shipments
The shipments component of the Cass Freight Index® grew 12% y/y in August and should slow to mid-single-digit growth into year-end on tougher comps.
On a seasonally adjusted (SA) basis, the Cass Shipments Index rose by 5.0% m/m in August, after a 7.2% m/m drop in June and July
The two-year stack reaccelerated to 3.7% growth from 0.5% in July.
The recovery after a skid in June and July amid further slowdowns in rail volume
Cass Freight Index - Expenditures
The expenditures component of the Cass Freight Index measures the total amount spent on freight. This index slowed a little more in August to 42% y/y growth from 43% in July. If normal seasonality were to play out for the rest of this year, the full-year increase in this index would be 35% in 2021, after a 7% decline in 2020 and no change in 2019.
After a 4.8% month-to-month drop on an SA basis in July, August expenditures surged 11.3% m/m as a result of both higher volumes and rates.
On a two-year stacked basis, the Cass expenditures index was up 35% in August, about 90% of which is due to higher rates, with the rest due to volume.
Tougher comparisons in the coming months will naturally slow these y/y increases further, but extraordinary growth rates will continue in the near-term, driven by increases in both shipment volumes and freight rates.

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Rates red-hot in August, shipments high but capacity constrained

Freight Waves Todd Maiden September 13 2021

Cass’ truckload linehaul index, which records changes in per-mile TL linehaul rates excluding fuel and assessorials, increased 12.6% year-over-year, almost 8% higher than the 2019 level. This was the second-highest index reading (only to May of this year) since Cass started tracking the data in 2005.
Further, Denoyer warned shippers that increases in the index are actually being suppressed by mix and capacity issues.
“This series has been under some pressure from longer-haul mix related to the chassis shortage and intermodal network congestion in recent months, so we would again caution shippers not to get too excited and carriers not to worry too much. This mix issue is noise, not signal, and the dampening effect on the index is considerable.”
The index saw shipment length of haul increase 5% sequentially (20% year-over-year). Longer lengths of haul place downward pressure on per-mile trucking rates.

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CRST finding better ways to utilize truck capacity via ELDs

The Journal of Commerce William B. Cassidy September 13, 2021


The capacity utilization benefits promised by the electronic logging device (ELD) mandate four years ago have been slow to arrive, but they are beginning to emerge thanks to a new generation of technology. At trucking firm CRST, for example, in-cab ELDs are being more tightly interwoven with back-office management systems, which means CRST can proactively use data to improve its productivity and service.
Seeking ‘driver enablement’
Estimated times of arrival (ETAs) and on-time performance are top of mind for shippers dealing with everything from delays in ocean transit to port congestion that is straining intermodal and trucking capacity, pushing transportation pricing higher. Shippers moving goods to major retail customers are struggling to avoid “on-time, in-full" (OTIF) fines for missing delivery appointments.
Kilgore said using technology to increase what he calls “driver enablement” will help CRST attract and keep more drivers. That means automating as much of the driver’s daily work as possible while collecting and transmitting data to customers in real time. “We really needed to enable our truck drivers to be successful, and the telematics device inside the truck is the primary vehicle to make that happen,” he said.
To that end, CRST is implementing an all-in-one fleet management system from Maven, a Pittsburgh-based technology company, that will replace individual “siloed” systems. The system is the latest step in the evolution of driver management from the paper logbook and telephone-based dispatch to ELDs and now a more integrated enterprise approach, said Maven CEO Avi Gellar.

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The old- and new-school ways fleets validate freight

Transport Dive Amanda Loudin September 13, 2021

New-school tools
While there are advancements in freight validation, some come at a stiff price tag.
Dimensionalizers are one option. These devices can measure three-dimensional or cube-shaped objects, like packages, parcels, cartons or boxes.
"Dimensionalizers are automated systems that scan the weight and dimensions of freight in seconds, taking human error out of the equation, and offer simpler and more efficient rate calculations," said Curtis. "They have been used in parcel operations for decades, but LTL has only begun the switch in recent years."
But the cost can run $80,000 and up, said Curtis, so fleets need to calculate the value.
"They are expensive pieces of equipment but carries can see a rapid payoff in just a month or two," he said.
Payoff arrives because freight validation maximizes a fleets goals and profit margins, Curtis added.
"You want to move the most amount of product legally in the shortest amount of time," he said. "By freight validation, a company can be more effective in the movement of freight and cut their overhead, which translates into bigger profits."

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Diesel Price Barely Budges, Dips 0.1¢ to $3.372

Transport Topics September 13, 2021

• Diesel’s price went down after two consecutive weekly gains that totaled 4.9 cents.
• Trucking’s main fuel costs 95 cents more a gallon than it did at this time in 2020.
• The price of a gallon of diesel dropped in six of the 10 regions in EIA’s weekly survey. The biggest decline was nine-tenths of a cent in the Rocky Mountain region; the biggest increase was six-tenths of a cent in the Lower Atlantic.

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August Class 8 Retail Sales Rise 2.8% Year-Over-Year

Transport Topics Roger Gilroy September 13, 2021

U.S. Class 8 retail sales in August inched slightly higher as truck makers posted mixed results compared with a year earlier, WardsAuto.com reported.
Class 8 sales bumped up 2.8% to 18,176 compared with 17,685 in the same 2020 period, according to Wards.
The modest gain unfolded as “the chip shortage may have some light at the end of the tunnel, but it continues to slow equipment capacity growth,” Tim Denoyer, vice president of ACT Research, said in a release.
And the delta variant of the coronavirus, which worsened the chip shortage, could also impact “the nascent and gradual recovery in driver supply,” he added.

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Shoppers returning to their earlier pandemic behaviors, research finds

Retail Dive Daphne Howland September 13, 2021

Consumers are retrenching in the face of the delta variant of the coronavirus, with 20% "highly optimistic" about a return to normal, down from a third at the beginning of the summer, according to Numerator research. Nearly 60% are "very or somewhat concerned" about holiday plans being disrupted by the pandemic, Berkeley Research Group found.
The number of people who said they had resumed pre-COVID behaviors fell for the first time, from 39% in July to 27% in August, Numerator said. Nearly half say they expect a full reopening to be delayed until 2022 or later, up from 23% who said so in July and 18% in June, the firm found.

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ATA warns vaccine mandate could do ‘harm’

Freight Waves John Kingston September 13, 2021

The statement also suggests the ATA may be hearing from members that the 100-worker cutoff creates a potential bifurcation that would give smaller companies not under the rule a significant advantage in hiring drivers. Some state trucking association officials said last week that some of their small members are expressing optimism that the mandate’s exemption of companies with fewer than 100 workers would aid their recruitment efforts.
“If these mandates are designed to protect Americans, then why the discriminatory 100-employee threshold, picking winners and losers for both employees and employers?” Spear said.
When a trade association or political official says something is “well-intentioned,” it’s a pretty good bet that what comes after is strong criticism. Spear did not disappoint.
“These proposed requirements — however well-intentioned — threaten to cause further disruptions throughout the supply chain, impeding our nation’s COVID response efforts and putting the brakes on any economic revival,” he said.

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US House Panel Considers Climate Change, Transit Budget Sept. 14

Transport Topics Eugene Mulero September 13, 2021

Rep. Peter DeFazio (D-Ore.), the committee’s chairman, has emphasized a commitment to promote severe-weather-resilient infrastructure policies, as well as boosting funding for transit operations and high-speed rail nationwide.
According to the panel’s budget document, transportation policymakers will be asked to consider:
• $10 billion for high-speed rail
• $2.5 billion for supply chain resilience and congestion reduction at ports
• $6 billion for “local surface transportation priorities,” which are expected to result in congressional earmarks
• $100 million to establish a traffic safety clearinghouse
• $8 million for a highly automated vehicle and mobility innovation entity.

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Logistics investors plunge cash into ‘proof of delivery’ tech startup

The Journal of Commerce Eric Johnson September 13, 2021


A software vendor focused on letting shippers collect digitalized proof of delivery (POD) for drayage, less-than-truckload (LTL), expedited air, and final-mile moves has snagged a $5.5 million round of funding to expand the reach of its platform.
New Jersey-based Clockwork Logistics Systems, founded in 2017 by INTTRA veteran Rob Haney, provides a means to enable shippers and logistics services providers (LSPs) to collect information on shipment delivery that has been difficult to integrate in the past, owing to the myriad differences among systems and messaging formats used by facilities that receive goods. It does so by tapping into the GPS location of the driver making the delivery and providing a neutral structure across LSPs, facilities, container terminals, and other yards.
The company has, in particular, found a growing use case around capturing and avoiding detention and demurrage (D&D) costs by helping coordinate correct container and chassis pickups and dropoffs.

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Google dives deeper into supply chain services with project44 tie-up

The Journal of Commerce Eric Johnson September 14, 2021


Google, the fourth-largest company in the world by market capitalization and third-largest provider of cloud hosting services after Amazon Web Services (AWS) and Microsoft Azure, is diving head first into one of Amazon’s bread-and-butter businesses: logistics.
Google Cloud will use project44 as the cargo visibility data vendor for its Supply Chain Twin product, the companies said in a joint statement Tuesday, marking a key step in the evolution of both companies’ logistics industry ambitions.
The move comes as Google Cloud has made a foray into supply chain-related solutions, joining rivals Amazon Web Services and Microsoft Azure in seeing an opportunity to move from cloud-hosting architecture to direct applications for its customers.
The partnership will see project44 providing visibility data across all modes it covers for companies that are customers of both Google Cloud and project44. Chicago-based project44 has raised $300 million in venture capital over the past 10 months, while also acquiring container visibility competitors Ocean Insights and ClearMetal. It has also made headway into capturing trucking visibility data in Asia.

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