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Tuesday, July 7, 2020
Logistics Intelligence Brief
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Trucking

Increase in US truck freight tightens pricing pressure

The Journal of Commerce William B. Cassidy July 6, 2020

Short-term thinking vs. long-term goals How shippers view the market, and contracting, depends on the size of their business, its procurement culture, and existing carrier relationships. Are they more transactional when it comes to the trucking marketplace, or more strategic? Companies in 2018 with intent on becoming “shippers of choice” probably are less likely to demand big price cuts today. Those shippers are sticking with more strategic plans. “Nobody wants to repeat 2017 or 2018,” said Chris Caplice, co-director of the Massachusetts Institute of Technology Freight Lab and chief scientist at DAT Solutions. “They’d rather pay a little more to not have to go to the spot market. They’re trying to make fine-grained course corrections so the plan stays the plan.”

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Industry

Diesel Continues Slow, Steady Upward Climb

Transport Topics Dan Ronan July 6, 2020

The national average retail price of diesel rose for the fifth consecutive week, up seven-tenths of a cent to $2.437 a gallon, the Energy Information Administration reported July 6. Even with the increase from $2.43, the price of trucking’s primary fuel is 61.8 cents a gallon less than it was a year ago.

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May airfreight data hints at recovery, FedEx doesn’t expect capacity to normalize until 2021

Supply Chain Dive Matt Leonard July 6, 2020

Airfreight volume fell more than 20% year over year (YoY) in May, according to the latest numbers from the International Air Transport Association (IATA). Freight capacity fell nearly 35% YoY in May and international belly capacity fell by about 66% YoY as a result of passenger flight cancellations due to the pandemic, according to IATA.​

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Technology/Innovation

Prepare for the inevitable: How trucking firms protect data from cyberattacks

Transport Dive Heather Larson July 6, 2020

"Since the trucking industry is especially vulnerable to cyberattacks, it’s important to do what you can to minimize your risk of being hit," Jazrawy said. "There are two reasons for this vulnerability: Trucking is a high-dollar industry with large amounts of cash or credit available, and a carrier’s IT infrastructure is often older and understaffed.”

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Fleets Push Forward With Tech Investment Despite Pandemic, Economic Uncertainty

Transport Topics Stephen Bennett July 6, 2020

“Carriers in certain segments began to take a wait-and-see approach,” said Rob Abbott, a vice president with Lytx. “It wasn’t simply a drop in demand, but some uncertainty” about the economy over the next three to six months. For other carriers, the pandemic “accelerated and exacerbated” a need for telematics systems, he said. “We’ve seen fleets accelerate implementation without first conducting a long test,” as they might have done pre-pandemic, and relying more on recommendations from industry contacts, Abbott said.

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Government/Safety

Upcoming Operation Safe Driver Week puts drivers, equipment in the spotlight

CCJ Jason Cannon and Tom Quimby July 6, 2020

Law enforcement will be paying closer attention to unsafe driving behaviors of both truck and car drivers July 12-18 as part of the Commercial Vehicle Safety Alliance’s (CVSA) Operation Safe Driver Week. Next week’s push marks the first – and one of the largest – organized enforcement campaigns since the coronavirus pandemic cancelled CVSA’s annual International Roadcheck inspection blitz in early May. CVSA says less traffic on the roads due to the COVID-19 pandemic may be encouraging some drivers to ignore traffic safety laws, including speed limits. A number of jurisdictions, CVSA says, have seen “a severe spike in speeding” during the pandemic. To combat that trend, CVSA has selected speeding as the focus area for Operation Safe Driver Week, and being pulled over for speeding is an invitation for officers for deeper driver and vehicle inspections.

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The Moneyball effect: Controlling out-of-control insurance premiums

Freight Waves Brian Straight July 7, 2020

What can carriers do? Contrary to popular opinion, the safety and insurance experts said there are things carriers can do to keep rates manageable, or, in some cases, even to lower premiums. Carriers should start by understanding what is driving higher insurance rates. Reiser cited several factors:

  • Declining road infrastructure.
  • Inability to find good drivers.
  • Aging and unhealthy driver workforce.
  • Driving distraction (both commercial drivers and automobile drivers).
Of course, the big one is litigation. Reiser said that in many cases, the facts of the case are irrelevant. “One of the points we want to really hammer home … is that the facts of the case tend to not really be relevant in terms of what the jury may award,” he said. “We’ve seen some very public examples of that in the past year and a half where trucking companies have been hit by enormous verdicts that were not really [equivalent] to the facts of the case.
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FMCSA to provide ‘flexibility’ for random drug testing

Freight Waves John Gallagher July 6, 2020

Carriers struggling with their random drug and alcohol testing obligations because of the coronavirus pandemic can expect enforcement leniency from federal regulators. The Federal Motor Carrier Safety Administration (FMCSA) announced it “may exercise discretion” in enforcing minimum annual percentage random testing rates — as well as the requirement that employers spread testing dates throughout the calendar year — for carriers unable to meet the requirements. “As the Nation engages in a phased re-opening, the pace of return to normal operations will vary across the country,” FMCSA stated in a discretion determination notice issued Monday. “In some regions of the United States, motor carrier employers subject to controlled substance (drug) and alcohol testing … may be unable to comply with certain testing requirements due to the ongoing impacts of the emergency.”

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