Plus: Trucking bankruptcies climb under tariff pressure, a woman gets 11 years for a cartel trucking scheme, CPKC and BNSF reject rail mergers, and more in today's newsletter.
Happy Wednesday. DOT gives California, Washington, and New Mexico 30 days to enforce trucker English rules or risk losing federal safety funds. What it means for enforcement, state pushback, and the market in today’s feature.
📉 Trucking Bankruptcies Surge Under Tariff and Debt Pressure. Bankruptcies are accelerating across trucking, with 41% of logistics filings over the last five years occurring in just the past two years, according to BankruptcyData. Wayne State’s Michael Belzer warned, “The canary in this coal mine is trucking, which runs on the narrowest margins … until it fails.” Pandemic-era entrants, dubbed “Covid kids,” remain most vulnerable, having overpaid for equipment and relied on high spot rates. With tariffs deterring investment and some carriers turning to merchant cash advances with APRs of 50–300%, Michigan State’s Jason Miller said, “I’ve completely ruled out a market recovery in 2025.”
💊 Woman Gets 11 Years for Using Truckers to Haul Cartel Drugs. Oralia Rodriguez-Flores, 40, was sentenced to 11 years in federal prison for recruiting truckers to move cocaine and meth for Mexico’s Jalisco New Generation Cartel. Prosecutors said she paid drivers more than $1 million between 2021 and 2024, laundering proceeds through money service businesses and an Asian network. DEA seizures included 40 kilograms of cocaine from her semi-trailer in Kentucky. “Let this case stand as a warning to those willing to help Cartels poison our communities,” U.S. Attorney Ellis Boyle said. The DOJ emphasized the exploitation of trucking as a smuggling tool and vowed to continue targeting cartel-linked operations.
🚂 CPKC, BNSF Reject Rail Mergers as UP–Norfolk Plan Advances. Canadian Pacific Kansas City (CPKC) and BNSF Railway both rejected merger talks, even as Union Pacific pursues its $85 billion acquisition of Norfolk Southern. “Any major rail merger poses unique and unprecedented risks to customers, rail employees and the broader supply chain,” CPKC CEO Keith Creel warned. Instead, both carriers are emphasizing alliances, pointing to new CSX partnerships. Their stance narrows merger prospects and increases scrutiny on Union Pacific’s bid, which faces a Surface Transportation Board review of up to 22 months. Concerns include reduced competition and concentration of power in the first coast-to-coast U.S. rail network.
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USDOT warnedCalifornia, Washington, and New Mexico to start treating English Language Proficiency (ELP) as an enforceable disqualifier—or risk tens of millions in federal safety money. States are pushing back, Florida is doubling down, and industry groups are weighing in. Market-wise, early reads don’t show a shock to capacity.
What’s New
30-day clock + funding risk. Transportation Secretary Sean Duffy told three states to prove they’re enforcing trucker ELP or face withheld federal funds (reports peg it at ~$50M). That’s the sharpest federal lever yet on this issue.
Context: ELP has long been in federal regs; this isn’t new law. It’s new pressure tied to recent high-profile crashes and licensing controversies.
States’ response: CA, WA, and NM signal they already follow federal law, but USDOT says enforcement is inconsistent and wants proof now.
Florida goes further: The state is turningtruck weigh stations into immigration checkpoints, a move supporters call necessary and critics label a risky precedent for small carriers. Expect added friction on Florida lanes.
Testing integrity backdrop: Separate from ELP, Massachusetts troopers tied to a CDL testing scheme received sentences this month, reminding everyone the licensing problem isn’t just language.
Industry voices
“Basic English skills are critical for safely operating a commercial motor vehicle… Road signs save lives, but only when they’re understood.” —Todd Spencer, OOIDA
The Owner-Operator Independent Drivers Association backed the move, but critics warn blanket practices can morph into nationality-based discrimination rather than skills-based compliance.
As we reported on Monday, many FreightCaviar followers have seen some shippers and brokers ask for "U.S.-born drivers only" after the Florida crash.
Important note: The rule is about skills, not citizenship. Roughly 16% of U.S. truckers are foreign-born, and the vast majority operate safely and legally.
Two months into stricter enforcement, dry van spot linehaul rates remain stuck near cycle lows. The “capacity cliff” didn’t happen. Supply Chain Professor Jason Miller’s read of DAT data: freight pricing still looks demand-driven and 2025 tracks 2024 seasonality with typical Q4 tightening ahead.
The immediate impact looks to be increased paperwork and roadside friction. Let us know what you're seeing on the road over on our forum.
🚨 EPA Halts CA Emissions Road Checks. The EPA sued to block California’s Heavy‑Duty Inspection & Maintenance (Clean Truck Check), arguing the state lacks authority for emissions roadside stops.
🛠 C.H. Robinson New Tool. C.H. Robinson's new AI-powered planner gives shippers 24/7 optimization, raising the bar on automation, deepening Navisphere lock-in, and putting pressure on broker response times and pricing.
🤝 Nagle-Kandel Merger. Nagel Companies completed its acquisition of Akron-based Kandel Transport, expanding refrigerated food distribution in the Midwest. The deal also includes Kandel’s U.S.–Canada cross-border operations.
⚖️ NFI Misclassification Case. A New Jersey court advanced claims that NFI misclassified port truck drivers as contractors. Individual payouts could reach $50,000 each, though the average is speculated to be $30,000. This 10-year case has come to a close.
😔 Kroger Cuts Jobs. After its proposed Albertsons merger collapsed, Kroger is cutting 1,000 corporate roles nationwide. Interim CEO Ron Sargent said savings will support lower prices, new stores, and frontline job creation. The cuts do not affect frontline store or warehouse workers.
🙅♂️ DeSantis Rejects Petition. Florida Gov. Ron DeSantis dismissed a petition with 3 million signatures seeking leniency for a truck driver convicted after an illegal U-turn crash, saying the conviction “will not be overturned.”
🎣 THE FREIGHT CAVIAR CORNER
FreightCaviar Podcast: This week, we sit down with Kevin Novak, the mind behind ride-sharing's original surge pricing. The former Uber Head of Data and now Founder of Rackhouse Venture Capital shares his expert insights on why most companies' custom software stacks are likely to fail, the path to fully autonomous brokerage, and more. Catch it on YouTube, Spotify, or Apple Podcasts.
Freight Broker Group Chat: Lost a load to a ghost MC? Just discovered a 15-layer carrier spoof ring? Come swap war stories, drop memes, and ask the stuff no one wants to post on LinkedIn. Join us on forum.freightcaviar.com
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I’m Adriana, a writer and editor at FreightCaviar. I’ve covered everything from freight tech to industry lawsuits and market shifts, helping scale us to almost 14K subscribers. My goal: to make logistics stories digestible, clear, and fun to read.
Hello! I'm Jerome FreightCaviar! I’m into the politics of freight and the impact it will have worldwide. I'm always eager to learn more. Follow me on X @JeromeFreightC
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