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Logistics Intelligence Brief
Wednesday, November 24, 2021

Trucking

Yellow adds COO role to Harris’ list of duties

Freight Waves Todd Maiden November 23, 2021

Less-than-truckload carrier Yellow Corp. reported in a Tuesday filing with the Securities and Exchange Commission that recently named President Darrel Harris assumed the chief operating officer role effective Friday.
The 46-year-old has logged 25 years in the transportation industry, serving as CEO of transportation and logistics provider Xpress Global Systems prior to joining Yellow. He has also held sales and operations positions at carriers CRST International, Vitran and FedEx Freight (NYSE: FDX).
Harris arrived at the Overland Park, Kansas-based company to oversee its enterprise transformation. Now he’s overseeing a companywide restructuring dubbed “One Yellow.”
Under the plan, Yellow is consolidating the operations of its four previously siloed LTL carriers and its logistics company onto the same technology platform. The prior holding company setup allowed each carrier to operate independently but often added redundancy in pickup and deliveries at customer facilities.

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Trucking braces for uphill cost climb in 2022

Freight Waves John Gallagher November 22, 2021

With costs increasing in diesel fuel, driver compensation and equipment purchase/leasing, carriers are likely to face higher operational costs in 2021 and 2022,” according to the to the latest analysis on trucking expenses released Tuesday by the American Transportation Research Institute (ATRI).
“Ongoing shortages and supply chain issues will present new challenges to the industry. Meanwhile, rising traffic levels and the decline in average truck speed from 40.62 in 2020 to 40.24 mph in 2021 mark the gradual return of less desirable pre-pandemic conditions.”
ATRI’s latest analysis, based on marginal costs incurred in 2020, included data from 138,930 truck tractors and 418,520 trailers of varying types, representing over 12 billion vehicle miles traveled. The study found that overall operational costs for small carriers fell 3.1% in 2020 compared with 2019 and dropped 2.7% for large carriers.
Link: ATRI’s Latest Operational Costs Report Documents the Scale of COVID-19 Impacts on Trucking

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Truck tonnage levels see October gains, reports ATA

Logistics Management November 23, 2021

“October’s gain was the third straight totaling 2.9%,” said ATA Chief Economist Bob Costello in a statement. “The combination of solid retail sales, inventory rebuilding, and generally higher factory output offset some areas of softer freight growth, like home construction, in October. Economic growth remains on solid footing, which is good for truck freight volumes going forward. The largest problem for the industry isn’t the amount of demand, but making sure we have adequate supply. It is good to see that fleets were able to haul more tonnage in recent months in the face of constrained supply.”

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Thanksgiving week means tighter capacity and higher volume levels

Freight Waves Tony Mulvey November 23, 2021

True to seasonal form, tender volumes are ramping up ahead of the Thanksgiving holiday on Thursday. The Outbound Tender Volume Index (OTVI), which measures shippers’ requests for capacity, increased by 2.51% week-over-week (w/w), the largest single-week increase since the middle of September.
The increase in tender volumes levels is a traditional move, as shippers tend to put out more tenders, at the risk of more being rejected, during the holiday week. Tender volumes outside of the past week have largely been in a decline since the Labor Day holiday. Even with the increase over the past week, tender volumes have still slid by over 1% during the past month.

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JB Hunt starts transload service as shippers face intermodal congestion

Transport Dive S.L. Fuller And Sarah Zimmerman November 23, 2021

Transloading has long been a target growth area for J.B. Hunt, President of Intermodal Darren Field said during the company's latest earnings call. Demand for the service has risen, and there will be more opportunity to capitalize on that in the coming years, he added.
"For a long time, our target for growth in intermodal has been highway conversion first," Field said. "But, certainly, we have felt that domestic intermodal in a 53-foot container was a benefit to shippers importing through Southern California and ... certainly does represent an opportunity."
Railroad constraints, such as ramp congestion and labor headwinds, are another opportunity that has left room for J.B. Hunt to rethink intermodal, Simpson said. The company has three advantages it can use at railroads, she said: J.B. Hunt controls its own chassis, drivers and containers.
Domestic containers hold up to 50% more cargo than international ones, which makes transloading a financially appealing option for many companies, according to Michael Leue, CEO of the Alameda Corridor Transportation Authority, which oversees the rail corridor serving the ports of Los Angeles and Long Beach in California.

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Industry

Gaming Out How and When the Big Supply Crunch of 2021 Ends

Bloomberg Enda Curran November 23, 2021

Economists at HSBC have gamed out three scenarios for how and when the Big Crunch of 2021 eventually comes to an end:
• Shipping disruptions begin to ease after Lunar New Year in early February
• The supply headaches subside during the second half of 2022
• The challenges persist all next year

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Shippers/3PLs

We send back 30% of what we buy online. How our return culture alters the supply chain

The Los Angeles Times Opinion Gad Allon November 23, 2021

As the world pays new attention to supply chains, much of the focus has been on delays in delivering products to stores and consumers. What is called the forward supply chain, the path from raw material to the customer, is being scrutinized.
But the other side of the supply chain — the process of returning a product — also plays a significant role. Many goods that firms work hard to bring to the U.S. will be sent back soon after they are delivered. Across all e-commerce, about 30% of purchases are returned and about half of all clothing is sent back.
While the forward supply chain enjoys economies of scale at every stage, the reverse supply chain — the complicated act of retrieving a product from a customer — is costly and inefficient.

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Workforce

ILWU rejects one-year contract extension offer

The Journal Of Commerce Bill Mongelluzzo November 23, 2021

Subscription-Based

The International Longshore & Warehouse Union has rejected an offer by West Coast employers for a one-year contract extension, setting the stage for potentially volatile negotiations next year in an environment already marked by historic supply chain disruptions and heightened interest from Washington.
Jim McKenna, president of the Pacific Maritime Association, who will lead the negotiations for employers, said he formally requested a one-year contract extension in October, but union leaders last week rejected the offer.
“They said they haven’t been at the negotiating table for seven years, and they wanted to negotiate,” McKenna told JOC.com Tuesday.

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4 Ways Corporate Culture Can Help Retain Women at Your Fleet

Truckinginfo.com Vesna Brajkovic November 23, 2021

4. Create Resource Groups
Creating resource groups for women in an organization can give management insights into any barriers standing in the way of women working at a company or getting promoted within one.
At Walmart, for example. employees have access to a Women’s Resource Council. Each functional division has a chapter. Members across all levels of the organizations can discuss barriers women are facing, explained Walmart's McDaniel.
Groups like this create the space to have honest, open and vulnerable conversations, which can in turn create a culture where peers, team members and leaders are confident in pushing the company towards inclusion. In order to get true feedback, “you have to create a culture of openness and vulnerability to allow that to happen,” McDainel said.
When talking about driving change in diversity and inclusion, always remember who the audience is, explained XPO’s Lewis.

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Government/Safety/Sustainability

Texas jury awards $730M in fatal crash involving nuclear sub propeller

Freight Waves Noi Mahoney November 23, 2021

A Texas jury awarded $730 million on Monday to the family of a 73-year-old woman who was killed in a 2016 collision with a tractor pulling a flatbed trailer carrying an oversized load.
Toni Combest was killed Feb. 21, 2016, in Titus County, Texas, near the town of Mount Pleasant, when her vehicle collided with a truck operated by Landstar Ranger Inc. hauling a 197,000-pound propeller for a Navy nuclear submarine across a bridge.
Landstar Ranger settled about a week prior to scheduled jury selection for $50 million. S&M Pilot Service, the employer of the rear escort driver, also settled prior to trial for $1 million. The trial went forward against 2A Pilot Cars, the employer of the driver of the front escort vehicle.
The jury awarded $480 million in compensatory damages and $250 million in punitive damages, making it one of the largest wrongful death verdicts in the country.

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