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Logistics Intelligence Brief
Monday, March 6, 2023


Journal of Commerce Rankings: Top 25 truckload carriers saw big revenue gains in 2022

The Journal Of Commerce William B. Cassidy March 2, 2023


A tale of two markets
The 2022 results underscore the deep divide between the small number of large truckload companies that primarily operate under contract with large shippers and the tens of thousands of smaller carriers, including owner-operators, that make or break their fortunes on the transactional spot market.
“The top 25 truckload carriers represent less than 25 percent of total industry revenue, so their revenue growth of 18.5 percent is not representative of the total industry, as smaller carriers playing in the spot market via brokers did not do as well in 2022,” said Satish Jindel, president of SJ Consulting Group.
The results also show the strength of contractual rate increases those large carriers won in late 2021 and early 2022. Last year, all but two of the Top 25 truckload carriers increased revenue by double-digit percentages. In 2021, only 14 carriers of the top 25 recorded such strong revenue growth.

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Amazon pulls back from UPS as it builds out logistics empire

Supply Chain Dive Max Garland March 3, 2023

UPS plans to further reduce its business with top customer Amazon in 2023, even as both companies face obstacles that could complicate their mutually agreed cutback.
Amazon is shifting away from UPS and other carriers as it works to build its own logistics empire, in part to gain greater control over transit times and the end-customer’s delivery experience. Meanwhile, UPS has chased growth in segments outside of e-commerce in order to boost its profit margins.
Estimates from MWPVL International, a firm tracking Amazon’s growth, demonstrates the impact of both companies’ respective evolutions. The number of Amazon packages UPS handled in 2022 was 1.3 billion, down from 1.41 billion the year before.
Still, Amazon’s aggressive buildout of sortation centers, delivery stations and transportation infrastructure has allowed it to deliver significantly more parcels in-house overall. The company’s market share for U.S. parcel volumes grew to 22% in 2021, beating out UPS rival FedEx, according to the Pitney Bowes Parcel Shipping Index.

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Class 8 orders rise for first time in months

Fleet Owner Josh Fisher March 3, 2023

Preliminary North American Class 8 net orders rose in February for the first time in five months, according to two research firms that analyze and track commercial vehicle activity. After setting record highs in September, steady monthly declines in orders rebounded in February, potentially moving fleet equipment ordering back into steadier activity.
FTR Transportation Intelligence’s initial numbers pegged heavy-duty truck orders at 22,800 units. ACT Research’s preliminary February total was 23,600 Class 8 orders. After the two firms’ data differed by more than 3,000 orders in January, their initial reporting fell closer in line this past month.

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U.S. Importers Seize on New Shipping Rules to Fight Late Fees

The Wall Street Journal Paul Berger March 3, 2023


U.S. importers are fighting millions of dollars in fees imposed by the world’s largest ocean carriers with the help of a new federal law and a newly emboldened regulator.
Shippers of furniture, electronics and clothing say they were blindsided during the Covid-19 pandemic when ocean carriers added large fees for delays picking up and returning containers, even when importers had no chance of moving the boxes because of circumstances beyond their control.
“I don’t like being a victim and I felt like I was victimized without recourse,” Ryan Frey, an importer of lithium batteries, said of the fees. He said his company, Lion Energy LLC, which imports about 800 containers a year, felt it had little power to dispute the charges.

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U.S. rail carload and intermodal volumes see annual February declines, reports AAR

Logistics Management March 3, 2023

Rail carloads—at 905,744—were down 1.6%, or 15,101 units—compared to February 2021. And eight of the 20 carload commodity categories tracked by the AAR saw annual gains, including: crushed stone, sand & gravel, up 8,821 carloads or 13.1 percent; petroleum & petroleum products, up 5,833 carloads or 15.8 percent
Intermodal containers and trailers—at 943,979—were off 8.4%, or 86,351 units, annually. Combined U.S. rail carload and intermodal volumes, for the month of February, came in at 1,849,723, saw a 5.2%, or 101,452 carloads and intermodal units, annual decrease.

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Embark Trucks laying off 70% of employees, winding down business

Freight Waves Alan Adler March 3, 2023

Embark Trucks laid off 70% of its workers on Friday and may liquidate. The first autonomous trucking company to haul freight cross country under robot control is closing offices in Houston and Southern California.
It is the latest example of a transportation startup struggling to survive. A week ago, autonomous platooning startup Locomation denied published reports it was closing. But it acknowledged laying off an unspecified number of employees.
The Embark board of directors on Wednesday approved exploring, reviewing and evaluating a range of potential strategic alternatives available. That includes alternative uses of the company’s assets to commercialize its technology. Without additional sources of financing, potential dissolution … and liquidation is possible,” the SEC filing said.

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Parking for semis is so scarce it leaves truckers in peril and feeling ‘homeless’

KCUR/NPR Frank Morris March 6, 2023

But the growing scarcity of truck parking puts those drivers in trouble and slows down an economy increasingly dependent on moving fuel, food, and whatever you order online down the highway.
Meanwhile, truckers get ever more frustrated that Washington has failed to find enough safe places for them to pull over.
Michael Collins schedules his work around parking. The early-evening view of that Oak Grove truck stop from his parked cab explains why.
“Well, you see it, there's really no parking,” he said. “So, around two o'clock in the morning, they're gonna be double parked everywhere, because there's just nowhere to park.”
When truck stops like this one get full, the rest areas do, too. Drivers find themselves hunting for parking on Interstate off-ramps, on side streets, or at abandoned gas stations.

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Idaho Offering Two Military Waivers to Increase CDL Holders

Transport Topics Noel Fletcher March 3, 2023

One waiver is the military CDL skills waiver so veterans and military service personnel are no longer required to take a skills test with a CDL examiner.
The other is called the “even-exchange waiver” so they don’t have to take either the skills or written knowledge tests.

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Bars, Hotels and Restaurants Become the Economy’s Fastest-Growing Employers

The Wall Street Journal Nate Rattner et al. March 5, 2023


The leisure-and-hospitality industry is rebuilding its workforce after cutting back during the pandemic’s early days. In contrast, companies focused on providing business and tech-related services have slowed their growth in recent months.
Because the hospitality industry includes a larger number of private-sector jobs than the tech and information sectors, the shift in hiring patterns has helped keep the U.S. unemployment rate at a 53-year low and the overall job market tight.

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Fed’s Rate Moves Put Manufacturing Sector at Risk

The Wall Street Journal David Harrison And Austen Hufford March 6, 2022


The American manufacturing sector is starting to show signs of weakness after two years of strong growth, as higher interest rates and a slowdown in exports threaten production.
The Fed’s aggressive pace of interest-rate increases to fight inflation has made it more expensive to borrow for big-ticket items such as consumer appliances or business machinery. Fed officials in early February approved raising their benchmark rate to the highest level since 2007, and have signaled they are likely to raise rates again when they convene later this month.
“As the Fed continues to hike, manufacturing is going to be in the crosshairs,” Mr. Millar said. “It’s hard to see this sector not suffer some sort of a downturn that is more significant than what we’ve seen already.”

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February services sector activity shows continued growth, reports ISM

Logistics Management Jeff Berman March 3, 2023

Services economy activity remained solid in the early stages of 2023, according to the new edition of the Services ISM Report on Business, which was issued today by the Institute for Supply Management (ISM).
The Services PMI—at 55.1 (a reading of 50 or higher signals growth)—was essentially even with January’s reading with a 0.1% decline, growing, at a slower rate, for the second consecutive month. January was 6.0% above December’s 49.2, which was down 6.9% compared to November’s 55.5. ISM added that the overall economy also grew, at a slower rate, in February, for the second consecutive month.
Link: Institute Of Supply Management February 2023 Services ISM® Report On Business®

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