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Logistics Intelligence Brief
Thursday, June 1, 2023


Large US truckload carriers reined in capacity in Q1: Journal of Commerce index

The Journal Of Commerce William B. Cassidy May 31, 2023


Capacity is exiting the US truckload market, albeit slowly, with a group of the largest US truckload carriers reducing their truck numbers by 5% from last year’s fourth quarter to the first quarter of 2023, according to the latest quarterly Journal of Commerce Truckload Capacity Index (TCI).
All the carriers included in the TCI, released Wednesday, decreased their tractor counts from the fourth quarter to the first quarter, pulling the index reading down from 91.2% to 86.6%. On a year-over-year basis, the TCI dropped 2.2 percentage points below an 88.8% reading in the first quarter of 2022.
The Q1 contraction, while steeper than seen in recent quarters, is still not big enough to make a major dent in overall truckload capacity or reverse truckload pricing trends that favor shippers. The declines do signal that large truckload carriers are adapting to a soft market by reining in and redirecting capacity. That will place them in a better position when stronger truckload demand returns.

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Dry Van Report: Truckload Demand Continues To Drift Sideways

DAT Freight And Analytics Dean Croke May 30, 2023

Some recent truckload demand indexes align to paint a gloomy picture for truckload carriers looking for a rebound in freight demand this year. So far, many of the publicly traded trucking companies reported that they didn’t see the usual seasonal bounce in freight volumes in March that they expected, according to Prof. Jason Miller at Michigan State University (MSU). The MSU for-hire trucking ton-mile index (TTMI) saw a seasonally adjusted decline of 0.7% m/m in March and was down 2.7% from March 2022 (the high-water mark in the index’s history). According to Miller, “TTMI shows no signs yet that we will be exiting this freight recession soon, though hopefully, we won’t go back to the even lower levels that we saw in December 2022. Carriers should expect aggregate demand for trucking to be 2.0% to 3.0% below levels this time in 2022 until we reach the back half of the year when comps become easier.”

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Parcel carriers, shippers steer into choppy waters as a perfect storm of challenges approaches

DC Velocity Gary Frantz June 1, 2023

As the parcel express market heads into summer, a perfect storm of carrier challenges, market shifts, an unsettled economy, and weakening demand is threatening to upend the best-laid plans of shippers—just as supply chains are beginning to normalize after two years of pandemic-induced turmoil.
Among the challenges:
• A massive restructuring at FedEx designed to cut costs, consolidate ground and express parcel network operations into a new organizational structure called “One FedEx,” and ultimately shutter and combine some 100 locations.
• Slowing e-commerce volumes as consumers become more cautious, shift spending from goods to services, and return to shopping in stores.
• Shippers dealing with stubbornly high rates as well as a rising tide of parcel and package surcharges and fees.
• And last, but certainly not least, an expiring contract and upcoming July deadline as the Teamsters Union and United Parcel Service negotiate a new labor agreement impacting some 330,000 workers and about 20 million packages a day.

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SEKO Logistics’ executives address Peak Season potential amid economic backdrop

Logistics Management Jeff Berman May 31, 2023

“Later on in the year is something we are paying attention to really closely, because if it is a situation where everyone waits until the last minute to get products on the shelves for the holiday season because they have burned through their inventory, then it can be viewed as a challenge.
But we don’t see that happening yet although it is something we are watching,” he said. “We are getting a lot more questions from customers around getting product closer to customers globally and through multiple channels and getting ready in preparation for selling through as many channels as they can to increase sales and demand.”

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Top furniture brand ditches 1980s supply chain tech for improved inventory accuracy

Digital Commerce 360 April Berthene May 30, 2023

 American Signature’s old supply chain and warehousing technology is a barrier to growth and recruiting top talent.
 With improved inventory accuracy, American Signature plans to meet its delivery promise at least 85% of the time, up from its current 60% of the time.
 The furniture brand is upgrading its system with six of Manhattan Associates’ applications: Warehouse management, order management, point of sale, customer engagement, customer service and customer service index reporting suite.

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Descartes sees February as cycle low point

Freight Waves Todd Maiden May 31, 2023

Supply chain software-as-a-service provider Descartes said Wednesday that February was likely the low point for the cycle, noting demand trended up somewhat in March and April.
The company has seen ocean imports increase sequentially since February to a level that is in line with pre-pandemic levels as retailers have made progress selling through excess inventories. It also noted that China-originated orders increased in April but that it’s still too early to say if this is indicative of a new trend line.
“If I use April as an example, I’m optimistic about what we see in May,” CEO Ed Ryan told analysts on a Wednesday evening call. Ryan tempered the remarks somewhat, noting it’s still a “mixed-news economy at the moment.”

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How a DHL center in Seattle moves 4,000 packages daily

Transport Dive Kelly Stroh May 31, 2023

An unassuming gray building in Seattle’s Industrial District is home to a logistics hub that helps connect shippers and customers around the world in one to three days.
DHL, which specializes in international and cross-border shipments, has a 60-truck fleet and a team of nearly 80 workers at the Express Service Center dedicated to the safety, speed and accuracy of last-mile deliveries.
Supply Chain Dive toured the Seattle facility last month for a firsthand view of how fashion merchandise, electronics and more move through the warehouse and DHL’s broader network. Here’s what we learned.

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Long-haul’s journey to near-zero

Fleet Owner Cristina Commendatore May 31, 2023

Diesel remains the gold standard today in terms of availability, infrastructure, and range, whereas battery-electric and hydrogen fuel cell are the gold standard in terms of zero emissions. However, as fleets well know, battery-electric range isn’t there yet for long-haul, while the technology and infrastructure for hydrogen fuel cell, which is ideal for long-haul applications, isn't yet built out or mature enough to meet the needs of the trucking industry sector.

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Truck Driver Positive Tests for Marijuana Up 9.2% in Q1

Transport Topics Eric Miller May 31, 2023

The number of truck drivers testing positive for marijuana use increased 9.2% the first three months of 2023, and a large number of those who failed their tests are not enrolling in the return-to-work program, according to federal Drug & Alcohol Clearinghouse data.
As of the end of March — the latest numbers posted in the Clearinghouse — 110,856 drivers have tested positive since the Clearinghouse opened in January of 2021. The number of drivers who tested positive for pot the first three months of this year totaled 9,344.

Related: Heavy Duty Trucking Loophole Closed in Reporting Driver Drug/Alcohol Violations

Link: Federal Motor Carrier Safety Administration Drug And Alcohol Clearinghouse Monthly Summary Report

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Operation Safe Driver Week Is July 9-15

Commercial Vehicle Safety Alliance May 31, 2023

Each year, Operation Safe Driver Week focuses on a specific unsafe driving behavior to call attention to the dangers of that behavior. This year, the focus will be on speeding. CVSA has continued to focus on speeding because it remains a persistent problem on our roadways. Speeding increases the frequency and severity of crashes, and unsafe speeds are a well-documented factor in fatalities and injuries.

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NHTSA to Require Automatic Emergency Braking on New Vehicles

Transport Topics/Associated Press Tom Krisher and Ashraf Khalil May 31, 2023

The U.S. government’s auto safety agency plans to require that all new passenger cars and light trucks include potentially life-saving automatic emergency braking and meet stricter safety standards within three years.
The May 31 announcement by the National Highway Traffic Safety Administration represents the agency’s latest move toward regulating electronic systems that take on certain tasks that drivers themselves have normally done. NHTSA has been reluctant in the past to impose such regulations, saying the technology will change during the time it takes to enact new rules.
Ann Carlson, the safety agency’s chief counsel, says 90% of new passenger vehicles already include the braking technology under a voluntary program that automakers have approved. But she says NHTSA wants to make the braking systems more effective at higher speeds and better at avoiding pedestrians, especially at night.
Link: National Highway Traffic Administration Press Release NHTSA Proposes Automatic Emergency Braking Requirements for New Vehicles

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California State Assembly votes to ban driverless trucks

Freight Waves Alan Adler May 31, 2023

The California State Assembly voted Wednesday to ban driverless trucks from the state’s roadways, requiring a safety driver be present. If passed by the Senate, it would leave the state where most autonomous trucking companies are based as an outlier in adopting the technology.
The 54-3 vote banning autonomous vehicles over 10,000 pounds from operating without a safety driver followed similar majority committee votes on Assembly Bill 316. The measure received support from the Teamsters and other labor groups. They claim driverless trucks would eliminate thousands of good-paying jobs for human drivers.
“The public should not be treated as a lab rat for big corporations to test their technology. Californians deserve a safety-first approach. And this bill would do just that,” Randy Cammack, president of Teamsters Joint Council 42, said in March.
California 2024 Senate candidates U.S. Reps. Katie Porter, Adam Schiff and Barbara Lee have voiced support for the legislation. San Francisco Mayor London Breed also has expressed support.

Link: Teamsters Press Release Teamsters Commend California State Assembly For Passing AV Bill

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