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Logistics Intelligence Brief
Tuesday, September 13, 2022

Trucking

Q&A: Yellow Corp. CEO Darren Hawkins on new initiative to address labor needs Nashville Post Katelynn White September 12, 2022

Nashville Post Katelynn White September 12, 2022

How will this expansion specifically impact the Nashville academy?
Our Nashville distribution center has both a mechanics shop and extensive dock operations. As we build out the dock and mechanic apprenticeship, it will be in locations that are well-positioned to leverage the program expansion. We cannot miss out on referencing one important and unique feature of the Nashville Driving Academy: it is home to Women in Trucking’s 2022 Driver of the Year, Peggy Arnold. Not only is Peggy an over-the-road driver for Yellow, but she is also a certified safety trainer who works with apprentices when they are ready for their over-the-road training. With more than 2 million accident-free miles, Peggy has the safety leadership to share with our Driving Academy apprentices.

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Industry

Impossible task: ATA says 460,000 trucks needed to offset effect of potential rail strike

CCJ Jason Cannon September 12, 2022

Operating over a nearly 140,000-mile network in 49 states, the Association of American Railroads projects lost economic output due to a national rail shutdown could be more than $2 billion per day.
“Idling all 7,000 long distance daily freight trains in the U.S. would require more than 460,000 additional long-haul trucks every day, which is not possible based on equipment availability and an existing shortage of 80,000 drivers,” ATA President and CEO Chris Spear in the letter. “As such, any rail service disruption will create havoc in the supply chain and fuel inflationary pressures across the board.”
Related: CCJ Possible rail strike could be 'polar vortex-level shock to the freight market'

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Talks continue as railroads plan to halt operations

The Journal Of Commerce Ari Ashe September 12, 2022

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US Class I railroads are expected to start shutting down intermodal operations at midweek, or sooner, as talks continue feverishly behind the scenes between the railroads and labor to avoid a rail strike early Friday that would cause a massive disruption to the US supply chain. The Biden administration is said to be heavily involved in the contract talks.
Far-reaching impacts
Congress can block or delay a strike through legislation to appoint arbitrators to a board to hammer out a deal within 65 days. The last rail strike was in 1991, which Congress ended after less than 24 hours.

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Large railroad labor unions say they will strike if quality of life is not addressed in new contract

CNBC Lori Ann LaRocco September 12, 2022

Two of the largest railroad unions in negotiations with railroad carriers have drawn a line in the sand: They are demanding more quality-of-life provisions be put into the contract, covering attendance policies, vacation and sick days, or they will strike.
The Brotherhood of Locomotive Engineers and Trainmen and the SMART Transportation Division represent half of railroad union workers.
Eight out of the 12 unions have reached tentative agreements with the railroad carriers, according to the National Carriers’ Conference Committee. They did not negotiate the quality-of-life provisions, sources familiar with the negotiations tell CNBC. The unions have what are called “Me Too” agreements, which means whatever benefits the BLET and the SMART unions agree to in their contracts with the carriers, other unions’ members receive.

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US manufacturers producing higher truck volumes

The Journal Of Commerce William B. Cassidy September 12, 2022

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US manufacturers building up inventories moved more goods by truck in August, increasing their average shipping volume 1 percent year over year and 1.6 percent from July, according to data provided Monday by freight visibility provider FourKites. The average shipping volume for all other sectors fell 4.6 percent from a year ago in August, said Todd Simms, FourKites’ vice president of industry strategy, manufacturing.
“There is significant uneasiness among manufacturers,” Simms told JOC.com. “Yes, they know demand is up, and they know they’ve got steady growth, but do they have enough safety stock? They’re concerned about when the next shoe is going to fall.” That “shoe” could be a recession, or it could be fresh supply chain disruption that makes critical components needed to finish a product harder to get.

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US imports keep chugging along, still up double digits vs. pre-COVID

Freight Waves Greg Miller September 12, 2022

U.S imports totaled 2,529,042 twenty-foot equivalent units in August, according to Descartes. That’s down 1.8% year on year (y/y), marking the first time since July 2020 that Descartes’ monthly tally has not increased y/y.
However, a sequential drop in volumes did not drive August’s y/y decline. Rather, it was due to a jump in imports in August 2021, i.e., tougher comps versus the year before.
This August’s imports were essentially unchanged versus the very strong numbers in July. They fell 0.1% or 1,864 TEUs compared to July — a small feeder ship’s worth of cargo.
August’s imports were up 18% versus August 2019, pre-COVID. In July, volumes were up 15% from pre-pandemic levels.
“A number of factors, such as a slowing economy, inflation and high fuel costs have still not had the anticipated impact of slowing down U.S. container imports,” said Descartes.

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Diesel Drops 5.1¢ to $5.033 in Second Straight Decline

Transport Topics September 12, 2022

• Despite the second straight decline, the price of diesel has been above $5 a gallon since a 20.6-cent spike Aug. 29 raised the cost to $5.115.
• On average, gallon of diesel costs $1.661 more than it did at this time a year ago.

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Storage, Labor Plague Logistics Companies Searching for Warehousing Solutions

Transport Topics Mindy Long September 12, 2022

“We’re seeing out-of-season stock being taken out of containers and put in warehouses that should have gone from the ports to the distribution centers and then out to the stores,” he said. “They don’t want to miss their next window, so product is being delivered into the U.S. earlier than it would have been.”
Peter Bayer, senior vice president of operations at Penske Logistics, argues that warehousing is a basic process where product arrives, it’s offloaded, then stored. But when it comes in irregular patterns, there’s imbalance and friction.
He noted that friction results in warehouse labor scheduling issues, driving overtime, congested yards, increased driver detention and inefficiency. Most importantly, it has created a lack of space. In most markets, occupancy is at 98% to 99%, and what is open may not be available for three or six months. “We have found more often than not, we’re jamming it in,” Bayer said.

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Workforce

Covid-19 Illnesses Are Keeping at Least 500,000 Workers Out of U.S. Labor Force, Study Says

The Wall Street Journal Gwynn Guilford September 12, 2022

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“If we stay where we are with Covid infection rates going forward, we expect that 500,000-person loss to persist until either exposure goes down or severity goes down,” said Mr. Soltas. That assumes that some of those previously sickened eventually return to work.
The study, which hasn’t yet been peer-reviewed, was based on a representative population of more than 300,000 workers followed over 14 months in the Census Bureau’s monthly household survey. The analysis covered the period from January 2010 to June 2022. The authors used health-related, weeklong absences as a proxy for probable Covid illnesses. From March 2020 to June 2022, approximately 10 workers per thousand missed a week of work due to health reasons, on average, up from six per thousand on average over the decade before the pandemic.
Link: National Bureau of Economic Research The Impacts of COVID-19 Illnesses On The Workforce

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Experts weigh in on how to attract Gen Z to trucking as industry demographics shift

CCJ Angel Coker September 12, 2022

There are currently five generations in the workplace, and for every six retiring Baby Boomers with jobs in skilled trades like truck driving, there are only two workers from younger generations filling those roles.
“As an industry, if we're going to get more people to fill those replacements than say welding or automotive, we're going to really have to draw in Gen Z and really work hard to make a difference in their life through careers in trucking,” said Lindsey Trent, CEO of Next Generation in Trucking Association.

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Government/Safety/Sustainability

Deterring distracted driving to save dollars and lives

Fleet Owner Scott Keith September 12, 2022

In a country as litigious as the United States, fleets seeking to avoid dreaded nuclear verdicts must do everything they can to prove to the courts that they've done their due diligence when it comes to safety. Fleets are working to ensure that the proper technology is in place to address all the various ways drivers can be distracted to prevent collisions, save dollars, and save lives.
“Everything is discoverable in civil litigation,” said Phil Moser, a former police officer and VP of customer development at Driving Dynamics, a provider of driver safety training. “The attorney’s going to jump on there, and they're going to say, ‘If you had forward-brake assist, or if you had had lane-departure assist, lane-keep assist, this crash wouldn't have happened.’”

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A California employment attorney talks AB5

Transport Dive Colin Campbell September 12, 2022

What options do these fleet managers have when it comes to complying with AB5?
Damon Ott: First of all, the easy one: You can hire employee drivers with your own fleet. That’s an obvious one, and that’s the direction that the California legislature certainly wants companies to take.
The next one, starting at the top of the defensibility hierarchy, would be to operate as a pure broker, where you’re brokering loads solely under your federal brokering permit to authorized motor carriers.
Some companies are capable of getting into that position. But a lot of companies have contracts with customers that the customer is looking for a carrier. There could be a shift in terms of customer expectation, where so many companies are going to be saying, “You know what, we are actually a logistics company, and we will get your load where it needs to go, but we’re not a carrier. And so we can’t enter into a contract with you that’s going to require that we operate as a carrier.”

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There’s No Driving Test For Self-Driving Cars In The U.S. – But There Should Be

The Verge David Zipper September 12, 2022

Unlike their European peers, American car regulators do not require — or even offer — any kind of safety preapproval for a new car model or technology. Instead, car companies “self-certify” that their vehicles comply with federal guidelines pertaining to everything from steering wheels to brake fluids. But no such rules address the driver assistance and autonomous technologies that are critical to the car’s future — and to the safety of everyone who walks, bikes, or drives.
Facing no significant oversight, automakers like Tesla can legally deploy any advanced driver-assist system (ADAS) they like, regardless of how dangerous it may be. According to federal law, only if the Department of Transportation’s National Highway Traffic Safety Administration (NHTSA) observes a pattern of dangerous problems can it launch an investigation (which NHTSA is now doing with Tesla), potentially culminating in a recall. Until then, the cars under investigation can continue zooming along American roads and streets.

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Truckers’ overtime bill introduced in Senate

Land Line Mark Schremmer September 12, 2022

With the encouragement of the Owner-Operator Independent Drivers Association, Padilla introduced the Guaranteeing Overtime for Truckers Act in the Senate on Monday, Sept. 12. Rep. Andy Levin, D-Mich., introduced a House version of the bill in April.
The bill would amend the Fair Labor Standards Act of 1938 to “remove the overtime wages exemption for certain employees and for other purposes.”
“It’s hard to think of many professions where employees must be on the clock but not fully compensated for their time,” OOIDA President Todd Spencer said. “But this is the reality that many truckers face because of the FLSA overtime exemption. Shippers, receivers, carriers and others throughout the supply chain hardly have to think twice when they push truckers to work 60, 70 or 80 hours in a week because they know they won’t have to pay overtime.”

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