The domino effects are just starting to hit. Plus: FedEx dethroned UPS, Mexico truck production plunges, another $26M AI supply chain raise, and more.
Freight margins are razor-thin. The brokerages surviving it built nearshore teams that actually work.
Flatbed rejections hit a record 48.7%, broker numbers stop falling, and diesel jumps 30 cents overnight.
Happy Hump Day. In today's issue, we break down Arrive’s freight market analysis and outlook for 2024. Also, find out how senior spending is holding up the economy, learn about a sneaky cargo theft trend in SoCal, and get details on a sudden trucking firm closure, leaving drivers high and dry. Plus, get briefed on the TX-MX border backlog, Estes' cyber aftermath, and more industry updates.
🤔 Question of the Day: Can you guess the number of trucks that were stuck at the Texas-Mexico border as of Oct 9? Get the answer below in Around the Freight Web.
In today's email:
TOP LANE MOVERS POWERED BY GREENSCREENS.AI
*Greenscreens.ai forecasts real-time truckload buy prices that are suited to each freight brokerage's purchasing power using AI and machine learning. Its engine takes into account over 130 attributes and data points in each rate forecast.
🐔 WHAT’S COOKIN’ IN FREIGHT
👴 Seniors' Big Spending. As the Federal Reserve raises interest rates, the resilience of consumer spending is attributed to the growing elderly population. In August, a record 17.7% of the population was 65 or older, with strong finances and reduced borrowing needs. Seniors accounted for 22% of spending in 2022, up from 15% in 2010. Their spending reflects health, wealth, and post-pandemic attitudes. Older Americans are spending more on recreation, travel, and experiences. The baby boomer cohort's retirement years contribute to this trend, bolstered by their substantial wealth and Social Security adjustments. Seniors' robust spending is a key factor in economic stability.
🦺 Deceptive Theft Tactic Targets Drivers at Receiving Facilities. Southern California has become a hotspot for a cunning cargo theft tactic. Impostors, armed with safety gear and clipboards, misdirect drivers away from surveillance zones. As drivers follow protocol inside, accomplices quickly loot high-value items from trailers and load them into standby vans. With thieves even wearing company logos, the deception is detailed. To combat this, experts urge shippers to brief drivers in advance and for facilities to heighten awareness.
🚚 Company Shut Down Leaves Truckers Unpaid. Sunset Logistics, operating in Grand Rapids, Michigan, closed its doors, leaving 90 truck drivers and office staff unpaid. Employees received emails stating that final paychecks and escrow were uncertain, pending discussions with a lender. Some drivers were stranded far from home as they returned trucks to Ryder dealerships. The Gainey family, known in transportation, owned Sunset Logistics, and their history includes bankruptcy. Federal data showed the company had a higher-than-average out-of-service rate, and its insurance was set to be canceled. The sudden closure left newly hired drivers in a bad situation.
TOGETHER WITH RAPIDO
Rapido is a top nearshore staffing company providing logistics and supply chain talent to companies in the United States. Based in Guadalajara, Mexico, Rapido offers a unique combination of cost savings and access to a skilled workforce, making it an attractive option for American logistics businesses.
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Arrive Insights' forecast predicts North American truckload freight rates from October 2023 to December 2024. Their extensive research, along with predictive models from ARRIVEnow, provides an in-depth understanding of market dynamics. The relationship between demand, supply, and rates is highlighted, suggesting that rising demand and limited capacity will hike the rates.
In the upcoming year, spot rates are anticipated to rise, starting Q4 2023, with a floor increase seen throughout the year. The spot-contract rate gap is expected to narrow, making the market susceptible to potential disruptions. However, economic uncertainty remains a challenge. Key indicators suggest that by the end of 2024, van spot rates might grow by 20% year-over-year, whereas reefer spot rates could see a 15% year-over-year growth.
Several factors, such as global tensions, economic conditions, severe weather, carrier break-even points, and fuel volatility, could sway the freight market. The Russia/Ukraine conflict, China/Taiwan, and now the Israel/Palestine tensions are notable geopolitical risks. The market might also be affected by rising interest rates, a resumption of student loan payments, declining manufacturing orders, and potential severe weather conditions.
2023 rate movements for both van and reefer equipment largely aligned with previous forecasts. As the end of the year approaches, disruptions are anticipated, particularly for reefer equipment due to the holiday season. A positive growth is expected in spot rates for both van and reefer equipment by March 2024.
Source: Arrive Logistics
If you're interested in freight market updates and want accurate rates to quote your customers, then you'll love Greenscreens.ai.
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AROUND THE FREIGHT WEB
📦 P44 On-Time Delivery Hits Peak. Project44 reports 85.1% on-time parcel delivery rates, the highest since the pandemic's onset, challenging historical benchmarks.
🚛 Border Bottleneck. Gov. Abbott's border security measures have left 19,000 trucks stranded at the Texas-MX border, halting a value of $1.9 billion in goods.
🌐 Estes Cyber Scare Update. Estes Express Lines provided more details about the cyberattack the company recently experienced. Estes' main communication lines, including phones, were affected.
🌡️ UPS Boosts Health Logistics. UPS is set to acquire MNX Global Logistics, enhancing temperature-sensitive deliveries in healthcare. A strategic move toward dominating healthcare logistics.
🍁 Arrive in Canada. Arrive Logistics expands its tech-driven freight brokerage operations with new office in Toronto, tapping into increasing North American freight flows.
FREIGHT CONFERENCES WE'RE ATTENDING
CARRIER OF THE WEEK, PRESENTED BY LOST FR8
Established by the Garcia family in 2014 in Laredo, TX, Mone Transport manages a fleet of 100 tractors and 300 53’ van trailers. Specializing in efficient cross-border Mexico-US transportation, the company boasts a three-generation legacy, ensuring timely deliveries without transloading.
Click here to see where their current trucks are.
Also, check out:
The domino effects are just starting to hit. Plus: FedEx dethroned UPS, Mexico truck production plunges, another $26M AI supply chain raise, and more.
Flatbed rejections hit a record 48.7%, broker numbers stop falling, and diesel jumps 30 cents overnight.
Congress is moving to put driverless 80,000-lb trucks on public roads. Plus: 13,000 California CDLs get cancelled, diesel hits a 32-year record, Florida wants $50K to get your truck back, and more.
Ryan Schreiber breaks down everything about strategy, relationships, mindset, and AI in logistics.
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