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Friday, May 22, 2020
Logistics Intelligence Brief
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Trucking

YRC Freight Recognized as 2019 LTL Carrier of the Year by Dick’s Sporting Goods

YRC Freight Press Release May 21, 2020

Being recognized by one of the nation’s major retailers as its LTL Carrier of the Year is an honor and a testament to YRCW’s commitment to providing an enhanced customer experience,” said Jason Bergman, YRCW Chief Customer Officer and President of HNRY Logistics. “Dick’s Sporting Goods awarded YRC Freight its LTL business, and we stepped up to make a positive impact for our customer’s business and to exceed their expectations for LTL freight.”

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Analysts hopeful that worst of freight downturn has passed

CCJ James Jaillet May 21, 2020

Freight volumes seemingly have “found the floor,” said Chris Pickett, chief strategy officer at Coyote Logistics – a subsidiary of parcel giant UPS (No. 1 on CCJ‘s Top 250). “We think it’s an inflationary run from here,” potentially lasting for the next 18 months, Pickett continued, barring another virus outbreak that spurs another economic slowdown. He spoke in a webinar alongside three other Coyote analysts on Thursday, May 21. “From here forward, we think things are going to improve,” said FTR economist Bill Witte, who spoke in an FTR State of Freight webinar Thursday, May 14.

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Large US truckload carriers cut capacity again in Q1

The Journal of Commerce William B. Cassidy May 20, 2020

Large US truckload carriers stuck to plans to reduce their truck capacity in the first quarter, pulling the JOC Truckload Capacity Index (TCI) down for the fourth consecutive quarter after a 10-quarter capacity-building streak. The TCI dropped from a reading of 85.2 percent in the 2019 fourth quarter to 84 percent in the first quarter, as carriers either sold or parked equipment. Some large truckload companies also eliminated capacity by reducing their number of owner-operators. Werner Enterprises, one of the carriers in the JOC TCI group, reduced its use of independent contractor trucks by 17.8 percent year over year in the first quarter, according to its earnings statement. The Nebraska-based carrier’s overall truck count only dropped 1.4 percent from a year ago.

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Q&A: How Schneider is Using Artificial Intelligence

Truckinginfo.com Deborah Lockridge May 21, 2020

We also have deployed AI in our driver space. We have something that we call ETAI, which really focuses on using artificial intelligence in our ETA [estimated time of arrival] process. So we've taken a lot of the manual intervention out that traditionally a driver would've had to do and we're trying to allow them to focus on driving. So what we do is take the vast amounts of data that exist, including real time data such as traffic or weather, historical information about transit times, or even dwell times at a particular location. Not to mention information that only we have – driver preferences, their hours of service or their behavior – and we can provide a more accurate ETA that's constantly updating without the driver having to intervene. And we've found that to be more accurate than our previous method of doing it, but even more accurate than a lot of the data aggregators, for a lot of reasons, but [largely] because we have information that they just don't have about the drivers. So we found that to be a great productivity boost for our drivers. It allows them to get a better dispatch at the end of the day, which lets them keep rolling.

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Truck movement increases with help from CPG, food volumes

Supply Chain Dive Shefali Kapadia May 20, 2020

The data from FourKites reflects what many industry researchers have observed and predicted: The trucking market has hit the bottom, and a gradual return, although asymmetrical by industry and geography, is in the cards. To date, the biggest movement increases are in consumer-facing and essential industries. Volumes in food and beverage, CPG and retail are up by 5% to 10%, but manufacturing is up only marginally, according to Koepke. Link:  FourKites Heatmap Live Regional Inbound/Outbound Insights

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April tonnage shrinks, but seasonal work nudges rates up

Transport Dive Jim Stinson May 20, 2020

Spot rates were terrible in April, but analysts said rates were likely scraping the bottom and ready to rebound. The analysis by Sullivan indicates that is likely the case, with truckload capacity shrinking, pushing prices up.

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Shippers/3PLs

Walmart’s U.S. Boss Expects Coronavirus to Alter Shopping Permanently

The Wall Street Journal Sarah Nassauer May 20, 2020

WSJ: There’s been a massive shift online. How long will this buying behavior stick and how are you adjusting? Mr. Furner: It would be hard to say exactly how long any of these changes last, although I believe many of them will be permanent. We had some periods in the quarter when we saw as much as 300% growth rates with the [online grocery] pickup business. We slowed our pickup business while we focused on replenishing and restocking stores, then we quickly added back pickup slots. We’re at the highest slot level we’ve ever been, and we are still looking for more ways to innovate to either add more stores or more slots per store.

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Target tests post-store sort center for last-mile delivery

Supply Chain Dive Emma Cosgrove May 20, 2020

Target is testing a new sort center concept downstream from stores in order to better facilitate efficient last-mile delivery, COO John Mulligan said on the company's Wednesday earnings call. These sort centers are intended to remove parcel sorting from stores and enable higher throughput of e-commerce packages and more efficient shipping to lower costs per order.

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What the pandemic reveals about e-commerce

Retail Dive Daphne Howland May 20, 2020

When it comes to profits, Walmart didn't run into that level of trouble in its first quarter, although the company acknowledged that it couldn't avoid a hit to margins and profits from the period's ballooning online sales. The retail giant also announced that it is nixing its Jet e-commerce unit in favor of its own flagship site, which benefits somewhat from its ability to leverage stores for online fulfillment as customers themselves take care of the last mile.

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The Biggest Thing in Online Shopping? A Store.

Bloomberg Brook Sutherland May 20, 2020

Asked what kind of permanent changes he envisions in the post-pandemic world, Target CEO Brian Cornell said his “highlight and takeaway is stores are vitally important and stores will continue to play a really important role to America as we go forward." Who would have thought that a virus outbreak that's relegated so much of our lives to our homes would put such a premium on brick-and-mortar?

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In frenzied fear, the TIA attacks owner-operators

Land Line John Bendel May 21, 2020

Claiming to be fighting for free markets, freedom from regulation, and freedom itself, the TIA has declared war on owner-operators. It began with beleaguered owner-operators asking troublesome questions during peaceful and respectful demonstrations in Washington, D.C. and other cities. Low rates during the current economic collapse had brought many of them to the brink of bankruptcy. They wanted to know what shippers paid brokers for the loads they hauled. How much of the freight revenue were they getting?

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Kohl’s expects to reduce receipts 60% in Q2, even as stores open

Supply Chain Dive Emma Cosgrove May 21, 2020

Addressing inventory was the first action Kohl's executives took when it became clear that stores would need to close. Kohl's was not alone here with 11% of North American apparel retailers canceling more than half of their planned orders in response to the coronavirus crisis, according to McKinsey. Kohl's closed all of its stores March 20 and Gass described the company's ongoing posture as "very conservative."

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Best Buy poised to emerge a ‘winner’ as it leans on curbside, digital

Retail Dive Ben Unglesbee May 21, 2020

CEO Corie Barry said in a press release that Best Buy's move to curbside-only in the middle of Q1 helped it retain 81% of the previous year's sales in the last six weeks of the quarter "even though not a single customer set foot in our stores." Moody's senior retail analyst Charlie O'Shea said in emailed comments that Best Buy's Q1 results "reflect the quality and effectiveness of its multi-channel capability." Neil Saunders, managing director for GlobalData Retail, called the relatively modest 6.3% decline "nothing short of a remarkable result" given the store closures.

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Industry

U.S. rail carload and intermodal volumes are down for week ending May 16, reports AAR

Logistics Management Jeff Berman May 22, 2020

Intermodal containers and trailers—at 231,700 units—dropped 14% compared to the same week a year ago, topping the week ending May 9, at 227,405 units, and the week ending May 2, at 227,764 units.

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Ryder Expands E-Commerce Fulfillment Network

Transport Topics May 21, 2020

Ryder System Inc. added food-grade capabilities and additional locations to its e-commerce fulfillment network, the company announced May 20. The Miami-based transportation and supply chain management products provider said the move was to meet evolving consumer buying trends. The company added food-grade capabilities to two existing facilities within the network and a new facility near Philadelphia.

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Technology/Innovation

Loadsmart targets untapped digital transload opportunity

The Journal of Commerce Eric Johnson May 20, 2020

One of the more prominent freight brokers to emerge in the ongoing phase of venture capital-fueled logistics technology development now offers a platform linking drayage, transloading, and truckload modes. The service, introduced Wednesday by New York City-based Loadsmart, is aimed at helping shippers digitally stitch together the necessary landside modes for container shipments that need to be converted to truckload trailers after arrival at port.

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project44 adds key capabilities to Advanced Visibility Platform

Logistics Management May 20, 2020

The Advanced Visibility Platform focuses on shipment tracking and end-to-end visibility from the start of the shipping process to delivery (and beyond), as well as automation of key transportation processes, and also eliminates gaps in real-time visibility and powers users with high-quality and trustworthy Parcel, Final Mile, Less-Than-Truckload (LTL), Volume LTL, Full Truckload, Refrigerated, Rail and Ocean data.

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Government/Safety

OOIDA wants truck payments to factor in PPP loan amounts

Land Line Mark Schremmer May 21, 2020

OOIDA is asking the sponsors of the Paycheck Protection Flexibility Act to include improvements that will benefit small-business truckers. The Association on Wednesday, May 20, sent letters to Reps. Chip Roy, R-Texas, and Dean Phillips, D-Minn., requesting that HR6886 allow trucking companies to include truck payments, insurance payments and depreciation when calculating the maximum Paycheck Protection Program loan amount. OOIDA also asked for the bill to include provisions to allow trucking businesses to use the loans to cover a wider range of expenses and provide loan forgiveness for these purposes.

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Freight helping major toll highways weather pandemic

Freight Waves John Gallagher May 20, 2020

Two major U.S. turnpike authorities confirmed that freight traffic has been the lone bright spot in an otherwise dismal two months since the COVID-19 pandemic began decimating toll road revenue collections. Speaking at a press briefing Thursday sponsored by the International Bridge, Tunnel & Turnpike Association (IBTTA), Diane Gutierrez-Scaccetti, chairman of the New Jersey Turnpike Authority, said she has seen “no big drop-off” in commercial traffic despite overall revenue in March and April falling 25.1% and 61.6%, respectively. “Our commercial traffic has stayed pretty strong, so that has helped us leverage out the loss on the passenger side,” Gutierrez-Scaccetti said. She cited temporary increases in state weight limits and federal exemptions on hours-of-service rules as factors supporting the trucking sector.

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Workforce

ATA Releases Results of Latest Driver Compensation Study

American Trucking Associations Press Release May 21, 2020

"These results show that fleets did exactly what we would expect them to in the face of a tightening market for drivers: they raised pay and increased benefits in order to attract talent," said ATA Chief Economist Bob Costello. According to the survey, which was based on data from 2019, the average pay for truckload national, irregular route solo van drivers was roughly $58,000, up $6,000 from 2017. "We saw large carriers hire more entry-level drivers in 2019, including drivers directly from driver training school, which lowered the average pay for these carriers, but they did not reduce pay rates. It was just a different driver experience pool," Costello said.

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Economy

Mnuchin Says ‘Strong Likelihood’ for More Stimulus Spending

Bloomberg/Transport Topics Saleha Mohsin Bloomberg May 21, 2020

“I think there is a strong likelihood we will need another bill,” he said May 21 at an online event hosted by The Hill newspaper — but he also reiterated the Trump administration’s position that more stimulus isn’t needed immediately. “We’re going to step back for a few weeks and think very carefully if we need to spend more money and how we’re going to do that,” Mnuchin said. He said he had spoken to House Speaker Nancy Pelosi last week about implementation of the $2.2 trillion stimulus Congress passed in late March.

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Business

The Covid Surcharge: Companies Confront the Unforgiving Economics of Coronavirus

The Wall Street Journal Matt Grossman May 22, 2020

Companies from major retailers and package carriers to local restaurants and hair salons are awakening to a new economic reality in the age of the new coronavirus: Being open for business is almost as hard as being closed. Facing higher costs to keep workers and customers safe and an indefinite period of suppressed demand, businesses are navigating an ever-narrower path to profitability. To make the math work, some businesses are cutting services and jobs. Others are raising prices, including imposing coronavirus-related fees aimed at getting customers to share some of the expenses.

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