<div class="phx-topic abstract-wrapper">With a prolonged peak season, some non-asset-based intermodal marketing companies are reporting difficulties securing rail-owned containers and slots on trains in Chicago, Portland and Oakland over the past month.</div>

With a prolonged peak season, some non-asset-based intermodal marketing companies are reporting difficulties securing rail-owned containers and slots on trains in Chicago, Portland and Oakland over the past month.

Feature image

<div>Class I railroads are dealing with disruptions on the US West Coast and in the critically important Chicago market amid an extended peak shipping season that continues to set monthly records for domestic and international intermodal cargo volumes. While the disruptions have not reached the level of delays seen earlier this year in <a>Los Angeles</a> or <a>Tacoma</a>, some non-asset-based intermodal marketing companies (IMCs) report difficulties securing rail-owned containers and slots on trains in Chicago, Portland and Oakland over the past month. “It’s been surprising that coming out of Thanksgiving it has been challenging getting our hands on rail boxes in...

Class I railroads are dealing with disruptions on the US West Coast and in the critically important Chicago market amid an extended peak shipping season that continues to set monthly records for domestic and international intermodal cargo volumes. While the disruptions have not reached the level of delays seen earlier this year in Los Angeles or Tacoma , some non-asset-based intermodal marketing companies (IMCs) report difficulties securing rail-owned containers and slots on trains in Chicago, Portland and Oakland over the past month. “It’s been surprising that coming out of Thanksgiving it has been challenging getting our hands on rail boxes in Portland,” said an IMC executive who did not want to be identified. The source noted that while the issues posed challenges, they were less severe than disruptions experienced in the past four years. Railroads have diverted capacity to address surging demand in Southern California, which has been compounded by increased holiday parcel shipments from carriers such as FedEx and UPS. Record-breaking cargo volumes Cargo fluidity has slowed amid unprecedented intermodal volume in the Southwest US that has exceeded even the pandemic-related surges in 2020 and 2021. The Southwest intermodal market includes the ports of Los Angeles and Long Beach, the country’s busiest gateway. Domestic intermodal shipments originating in the Southwest set new monthly records every month from June through November, according to data from the Intermodal Association of North America (IANA). Railroads hauled 165,068 domestic loads from the Southwest last month, the most ever for the month of November. The heavy volumes have put pressure on Union Pacific (UP) and BNSF Railway moving cargo from Los Angeles to Chicago, Memphis, and markets in Ohio such as Cincinnati, Cleveland and Columbus. Between Nov. 18 and Dec. 13, railroads hauled 1.59 million international and domestic intermodal loads, marking the highest four-week average for that period since 2020, according to the Association of American Railroads (AAR), and showing clear evidence of a prolonged peak season. Still, despite the sustained volumes, service metrics have improved for train movements off the West Coast in the last four weeks. The number of loaded intermodal railcars idling for more than 48 hours has returned to normal levels, data from the US Surface Transportation Board (STB) shows. UP reported an average of 46.5 loaded railcars per day idling for more than 48 hours over the last four weeks, down from nearly 170 railcars per day in the first 45 days of the quarter. A spokesperson for UP said the railroad has worked to “meet committed capacity, reduce port dwell and improve transits.” Chicago backups IMCs, meanwhile, say they’ve faced struggles since mid-November securing reservations to drop off containers at CSX’s Bedford Park terminal in Chicago. “It’s gotten pretty bad at times with a lack of gate reservations, unless you’re willing to wait a week,” said a second IMC who also did not want to be identified. “It’s been really challenging.” The Midwest has experienced elevated domestic cargo volumes, with monthly records set in five of the last six months. In November, railroads hauled a total of 73,856 loads from the Midwest to the Northeast and Southeast, according to IANA, the second-highest November total after 2018. CSX said its gate reservation system is a critical tool to manage cargo flows during periods of heavy volume to ensure a smooth transfer of containers between trucks and trains. While the reservation system prevents terminals from becoming clogged with containers during volume surges, customers may have to wait days before dropping off boxes because only a finite number of reservations are granted each day. “While we recognize that persistent holiday traffic, weather conditions, and dwell increases created temporary delays for some IMCs, we continue to actively work with our customers to address their evolving service requirements,” a CSX spokesperson said in a statement to the Journal of Commerce. “Shippers are encouraged to collaborate with their account managers to explore solutions for increased volume or changing needs.” Contact Ari Ashe to ari.ashe@spglobal.com .

Rail News

North-American rail

Intermodal providers

Surface

IMCs dealing with rail service disruptions amid unusually high volumes

<div class="phx-topic abstract-wrapper">The largest US less-than-truckload provider is set to become a separate, independent company as FedEx pivots to focus on its parcel delivery business.</div>

The largest US less-than-truckload provider is set to become a separate, independent company as FedEx pivots to focus on its parcel delivery business.

<div class="phx-topic">FedEx on Thursday said it will spin off its less-than-truckload (LTL) division as an independent company, setting the stage for increased competition in the US LTL sector. The separation of FedEx’s parcel and LTL freight divisions, to be completed over the next 18 months, will create a new publicly traded company that will already be the <a href="https://www.joc.com/article/journal-of-commerce-rankings-ltl-sector-revenue-drops-despite-yellow-distortion-5199865">largest LTL provider</a> in North America ranked by revenue.“This is the right time to pursue a separation as we respond to the unique dynamics of the LTL market,” Raj Subramaniam, FedEx president and CEO, said in a statement. “Through this process, we will unlock value for our freight business and position FedEx to create even greater value for stockholders,” Subramaniam said. FedEx Freight will continue to cooperate and maintain commercial ties with FedEx and its parcel divisions — FedEx Express and FedEx Ground, Subramaniam said. FedEx Freight had $9.4 billion in revenue in its fiscal year that ended May 31. For calendar year 2023, the revenue figure was $10.2 billion. The next-largest LTL provider, Old Dominion Freight Line, had $6.2 billion in revenue last year, while the third-largest carrier, XPO, had $4.7 billion in 2023 revenue. <h3>Revenue growth expected </h3>As a separate company, FedEx Freight will be able to grow that revenue and increase its industry dominance, according to Satish Jindel, president of SJ Consulting Group. “This spinoff will bring more investment money from hedge funds and institutional investors into the LTL segment, [specifically to FedEx Freight],” Jindel said. “They’ll be able to shed overhead costs connected with the parcel business and invest in what makes sense from an LTL point of view, and that’s good for shippers,” he said. Competing carriers among the largest LTL providers have been bracing for a FedEx Freight spinoff, in part by <a href="https://www.joc.com/article/new-terminal-sales-by-yellow-raising-stakes-for-us-ltl-carriers-5903607">rushing to acquire terminals</a> from bankrupt Yellow. “FedEx Freight as an independent company will be a much stronger competitor,” said an LTL executive who did not want to be identified. “The shackles are off now.” Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

FedEx on Thursday said it will spin off its less-than-truckload (LTL) division as an independent company, setting the stage for increased competition in the US LTL sector. The separation of FedEx’s parcel and LTL freight divisions, to be completed over the next 18 months, will create a new publicly traded company that will already be the largest LTL provider in North America ranked by revenue. “This is the right time to pursue a separation as we respond to the unique dynamics of the LTL market,” Raj Subramaniam, FedEx president and CEO, said in a statement. “Through this process, we will unlock value for our freight business and position FedEx to create even greater value for stockholders,” Subramaniam said. FedEx Freight will continue to cooperate and maintain commercial ties with FedEx and its parcel divisions — FedEx Express and FedEx Ground, Subramaniam said. FedEx Freight had $9.4 billion in revenue in its fiscal year that ended May 31. For calendar year 2023, the revenue figure was $10.2 billion. The next-largest LTL provider, Old Dominion Freight Line, had $6.2 billion in revenue last year, while the third-largest carrier, XPO, had $4.7 billion in 2023 revenue. Revenue growth expected As a separate company, FedEx Freight will be able to grow that revenue and increase its industry dominance, according to Satish Jindel, president of SJ Consulting Group. “This spinoff will bring more investment money from hedge funds and institutional investors into the LTL segment, [specifically to FedEx Freight],” Jindel said. “They’ll be able to shed overhead costs connected with the parcel business and invest in what makes sense from an LTL point of view, and that’s good for shippers,” he said. Competing carriers among the largest LTL providers have been bracing for a FedEx Freight spinoff, in part by rushing to acquire terminals from bankrupt Yellow. “FedEx Freight as an independent company will be a much stronger competitor,” said an LTL executive who did not want to be identified. “The shackles are off now.” Contact William B. Cassidy at bill.cassidy@spglobal.com .

Trucking News

FedEx to spin off industry-leading FedEx Freight LTL division

<div class="phx-topic">Class I railroads are dealing with disruptions on the US West Coast and in the critically important Chicago market amid an extended peak shipping season that continues to set monthly records for domestic and international intermodal cargo volumes. While the disruptions have not reached the level of delays seen earlier this year in <a href="https://www.joc.com/article/la-lb-rail-dwells-spike-to-two-year-high-amid-record-imports-in-september-5750222">Los Angeles</a> or <a href="https://www.joc.com/article/los-angeles-tacoma-lead-gains-in-west-coast-imports-5217839">Tacoma</a>, some non-asset-based intermodal marketing companies (IMCs) report difficulties securing rail-owned containers and slots on trains in Chicago, Portland and Oakland over the past month. “It’s been surprising that coming out of Thanksgiving it has been challenging getting our hands on rail boxes in Portland,” said an IMC executive who did not want to be identified. The source noted that while the issues posed challenges, they were less severe than disruptions experienced in the past four years. Railroads have diverted capacity to address surging demand in Southern California, which has been compounded by increased holiday parcel shipments from carriers such as FedEx and UPS. <h3>Record-breaking cargo volumes </h3>Cargo fluidity has slowed amid unprecedented intermodal volume in the Southwest US that has exceeded even the pandemic-related surges in 2020 and 2021. The Southwest intermodal market includes the ports of Los Angeles and Long Beach, the country’s busiest gateway. Domestic intermodal shipments originating in the Southwest set new monthly records every month from June through November, according to data from the Intermodal Association of North America (IANA). Railroads hauled 165,068 domestic loads from the Southwest last month, the most ever for the month of November. The heavy volumes have put pressure on Union Pacific (UP) and BNSF Railway moving cargo from Los Angeles to Chicago, Memphis, and markets in Ohio such as Cincinnati, Cleveland and Columbus. Between Nov. 18 and Dec. 13, railroads hauled 1.59 million international and domestic intermodal loads, marking the highest four-week average for that period since 2020, according to the Association of American Railroads (AAR), and showing clear evidence of a prolonged peak season. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="6e445b7a-996b-4aec-afbc-9c2b9f2e6b78"></dynamic-object></div>Still, despite the sustained volumes, service metrics have improved for train movements off the West Coast in the last four weeks. The number of loaded intermodal railcars idling for more than 48 hours has returned to normal levels, data from the US Surface Transportation Board (STB) shows. UP reported an average of 46.5 loaded railcars per day idling for more than 48 hours over the last four weeks, down from nearly 170 railcars per day in the first 45 days of the quarter. A spokesperson for UP said the railroad has worked to “meet committed capacity, reduce port dwell and improve transits.” <h3> Chicago backups </h3>IMCs, meanwhile, say they’ve faced struggles since mid-November securing reservations to drop off containers at CSX’s Bedford Park terminal in Chicago. “It’s gotten pretty bad at times with a lack of gate reservations, unless you’re willing to wait a week,” said a second IMC who also did not want to be identified. “It’s been really challenging.” The Midwest has experienced elevated domestic cargo volumes, with monthly records set in five of the last six months. In November, railroads hauled a total of 73,856 loads from the Midwest to the Northeast and Southeast, according to IANA, the second-highest November total after 2018. CSX said its gate reservation system is a critical tool to manage cargo flows during periods of heavy volume to ensure a smooth transfer of containers between trucks and trains. While the reservation system prevents terminals from becoming clogged with containers during volume surges, customers may have to wait days before dropping off boxes because only a finite number of reservations are granted each day. “While we recognize that persistent holiday traffic, weather conditions, and dwell increases created temporary delays for some IMCs, we continue to actively work with our customers to address their evolving service requirements,” a CSX spokesperson said in a statement to the Journal of Commerce. “Shippers are encouraged to collaborate with their account managers to explore solutions for increased volume or changing needs.” Contact Ari Ashe to <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

<div class="phx-topic abstract-wrapper">The end of a regulation that limited import house locations will allow more flexibility for warehousing options, making the cold chain network more efficient for food importers.</div>

The end of a regulation that limited import house locations will allow more flexibility for warehousing options, making the cold chain network more efficient for food importers.

<div class="phx-topic">US food importers say the end of a federal policy linked to warehousing will allow them to nab refrigerated storage space more than 50 miles from a port, helping to reduce the risk of spoiled products and allowing containers to be moved out of marine terminals faster. Freight forwarders say elimination of the regulation, which was originally adopted to address delays caused by reefer containers being left at port terminals, will be especially helpful in preventing inspection delays during seasonal volume influxes of temperature-controlled fruit and vegetable cargoes.Food importers, in general, expect to see increased efficiency in their cold chains after the US Food Safety Inspection Service (FSIS) withdrew the policy limiting warehousing options. FSIS is part of the US Department of Agriculture (USDA). The regulation, which required import houses (I-House) be located within 50 miles of a shipment’s port of entry, was terminated Dec. 13. An I-House designation allows a warehouse to serve as a holding area for imports waiting to be inspected by FSIS, a stage where some food importers face delays. Since the policy change, FSIS has said it will consider, on a case-by-case basis, the addition of I-Houses outside of a 50-mile radius, while considering the availability of inspection personnel, expected volumes and operating hours.“We welcome this common-sense ruling, which will help our members not only drive operational efficiencies but also better meet growing customer needs for import services,” Sara Stickler, president and CEO of the Global Cold Chain Alliance, said. “An arbitrary restriction on where an inspection facility must be located leads to unnecessary inefficiencies.” <h3>Warehousing limitations, labor shortages</h3>Despite the progress expected by ending the warehouse rule, Eric Brown, president at JTP Transportation and a chair member of the Meat Import Council, said the temperature-controlled food import industry is still facing a major efficiency problem and that solving the warehouse issue may only amplify the impacts of a labor shortage. “We now have twice the amount of beef coming into the country with only half as many USDA inspectors that we had in the past,” Brown told the Journal of Commerce. “Inspecting the cargo quickly [drives the] inefficiency of the warehouses.” FSIS acknowledged in the Dec. 13 notice that network expansions will be limited by inspection staffing capabilities, saying it would like to provide more flexibility to import businesses, but it must be “balanced against the agency’s existing inspection resources.”“They have got to increase the number of people they have for sure,” Bill Duggan, North American advisor at reefer market consultant Eskesen Advisory told the Journal of Commerce. “Whether or not they have the budget for that, I don’t know.”Contact Laura Robb at <a href="mailto:Laura.Robb@spglobal.com">laura.robb@spglobal.com</a>. </div>

US food importers say the end of a federal policy linked to warehousing will allow them to nab refrigerated storage space more than 50 miles from a port, helping to reduce the risk of spoiled products and allowing containers to be moved out of marine terminals faster. Freight forwarders say elimination of the regulation, which was originally adopted to address delays caused by reefer containers being left at port terminals, will be especially helpful in preventing inspection delays during seasonal volume influxes of temperature-controlled fruit and vegetable cargoes. Food importers, in general, expect to see increased efficiency in their cold chains after the US Food Safety Inspection Service (FSIS) withdrew the policy limiting warehousing options. FSIS is part of the US Department of Agriculture (USDA). The regulation, which required import houses (I-House) be located within 50 miles of a shipment’s port of entry, was terminated Dec. 13. An I-House designation allows a warehouse to serve as a holding area for imports waiting to be inspected by FSIS, a stage where some food importers face delays. Since the policy change, FSIS has said it will consider, on a case-by-case basis, the addition of I-Houses outside of a 50-mile radius, while considering the availability of inspection personnel, expected volumes and operating hours. “We welcome this common-sense ruling, which will help our members not only drive operational efficiencies but also better meet growing customer needs for import services,” Sara Stickler, president and CEO of the Global Cold Chain Alliance, said. “An arbitrary restriction on where an inspection facility must be located leads to unnecessary inefficiencies.” Warehousing limitations, labor shortages Despite the progress expected by ending the warehouse rule, Eric Brown, president at JTP Transportation and a chair member of the Meat Import Council, said the temperature-controlled food import industry is still facing a major efficiency problem and that solving the warehouse issue may only amplify the impacts of a labor shortage. “We now have twice the amount of beef coming into the country with only half as many USDA inspectors that we had in the past,” Brown told the Journal of Commerce. “Inspecting the cargo quickly [drives the] inefficiency of the warehouses.” FSIS acknowledged in the Dec. 13 notice that network expansions will be limited by inspection staffing capabilities, saying it would like to provide more flexibility to import businesses, but it must be “balanced against the agency’s existing inspection resources.” “They have got to increase the number of people they have for sure,” Bill Duggan, North American advisor at reefer market consultant Eskesen Advisory told the Journal of Commerce. “Whether or not they have the budget for that, I don’t know.” Contact Laura Robb at laura.robb@spglobal.com .

Maritime

Cool Cargo News

Supply chain

Reefer cargo bottlenecks could improve after US scraps warehousing policy

<div class="phx-topic abstract-wrapper">Acquisitions, new product releases and fresh investment among companies catering to truckload brokers speak to an industry wrestling with the need to make things easier for customers.</div>

Acquisitions, new product releases and fresh investment among companies catering to truckload brokers speak to an industry wrestling with the need to make things easier for customers.

<div class="phx-topic">A surge of merger &amp; acquisition (M&amp;A) activity in the truckload technology space at the end of 2024 has been coupled with a handful of venture capital investments into predominantly <a href="https://www.joc.com/article/automation-key-to-improving-broker-efficiency-metrics-experts-5780765">AI-focused tools for truckload brokers</a>. Those two trends should not be viewed in isolation. In conversations with industry sources, it’s clear that certain companies — and their investors — are on the hunt for acquisitions that are affordable and allow the acquirer to build out a so-called end-to-end platform. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/5909019_0.1.jpg"></img></div>We’ve seen this story before, in terms of the bundling and unbundling of point solutions sold to shippers and freight brokers. It sort of mimics the way cable television got unbundled, only to find consumers wanting the convenience of a bundled package of programming as opposed to managing and paying for 10 different streaming services. As the truckload market looks to a possible recovery at some point in 2025, many of the software companies that grew either during or immediately prior to the pandemic found themselves wrestling with whether the market wants technology and data to be bundled or unbundled. And that has prompted a number of companies to sell to larger entities with more resources and customers. To wit, in the last two weeks, DAT, the largest US load board, <a href="https://www.joc.com/article/dat-acquires-trucker-tools-in-move-to-reduce-load-board-driver-churn-5907848">acquired Trucker Tools</a>, a platform used by brokers predominantly to book loads and track third-party carriers. A week prior to that, Triumph Financial, one of the largest payment and factoring providers to the truckload market, acquired Isometric Technologies, which helps brokers and shippers measure the performance of their truckload carriers. In mid-2024, the digital broker <a href="https://www.joc.com/article/transfix-sale-highlights-vcs-uneasy-fit-with-freight-brokerage-5192198">Transfix sold its brokerage division to NFI</a> and pivoted to become a technology provider to other brokers. Also this year, <a href="https://www.joc.com/article/resurrected-convoy-app-gaining-traction-among-small-carriers-brokers-flexport-5214133">Flexport released its Convoy platform for brokers</a> based off its late 2023 acquisition of the technology from the now-defunct digital brokerage. And <a href="https://www.joc.com/article/uber-freight-opens-up-truckload-capacity-network-to-rival-brokers-5817647">Uber Freight launched its Broker Access product</a>, allowing rival brokers to access its pool of carrier capacity. Alongside this M&amp;A activity and product releases, a number of technology providers working on a specific type of artificial AI, called AI agents, received funding rounds in the $15 million ballpark to build <a href="https://www.joc.com/article/broker-automation-vendor-lands-funding-round-in-increasingly-competitive-market-5874677">AI text and voice applications for brokers</a>, including Vooma and HappyRobot. Again, these investments are all linked. Brokers are already using many individual third-party software providers and data suppliers. When those companies combine, they theoretically allow the broker to access more value from fewer systems. But that consolidation is also happening because the existing technology suppliers to <a href="https://www.joc.com/article/truckload-brokers-eye-human-technology-balance-as-ai-takes-hold-5876340">brokers know that AI is coming fast</a>. <h3>Race is on </h3>There is an ongoing reckoning over what humans will do and what programs will do in the brokerage space, and the race to supply tools to both sets of “users” is on. “Larger players will race for an end-to-end offering to make deployment turnkey and easy,” a software CEO and veteran of the brokerage industry told the Journal of Commerce. “And although you’re hearing about these [huge] rounds from productive AI-driven companies, there are a lot of companies from earlier vintages out there dying on the vine.” M&amp;A is a constant in the transportation world. Even outside of technology, there continues to be frothy activity across modes, from <a href="https://www.joc.com/article/schneider-bolsters-us-east-coast-business-by-acquiring-cowan-systems-5824223">Schneider acquiring Cowan Systems</a> to <a href="https://www.joc.com/article/kn-acquires-majority-stake-in-big-us-drayage-provider-5817584">Kuehne + Nagel acquiring a majority stake in IMC Logistics</a>. But the truckload technology space is shaking out with a more rapid pace when it comes to M&amp;A, and it seems likely that pace will continue into 2025. As the software CEO put it, the industry is still struggling to understand what software-as-a-service (SaaS) in truckload is even worth. “At a macro level I’m asking myself every day: What is a SaaS company even worth now?” the source said. “Nobody knows because they don’t go public anymore. With AI advancing so quickly, I think the only thing that matters is the end result and the outcome for the customer.” Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

A surge of merger & acquisition (M&A) activity in the truckload technology space at the end of 2024 has been coupled with a handful of venture capital investments into predominantly AI-focused tools for truckload brokers . Those two trends should not be viewed in isolation. In conversations with industry sources, it’s clear that certain companies — and their investors — are on the hunt for acquisitions that are affordable and allow the acquirer to build out a so-called end-to-end platform. We’ve seen this story before, in terms of the bundling and unbundling of point solutions sold to shippers and freight brokers. It sort of mimics the way cable television got unbundled, only to find consumers wanting the convenience of a bundled package of programming as opposed to managing and paying for 10 different streaming services. As the truckload market looks to a possible recovery at some point in 2025, many of the software companies that grew either during or immediately prior to the pandemic found themselves wrestling with whether the market wants technology and data to be bundled or unbundled. And that has prompted a number of companies to sell to larger entities with more resources and customers. To wit, in the last two weeks, DAT, the largest US load board, acquired Trucker Tools , a platform used by brokers predominantly to book loads and track third-party carriers. A week prior to that, Triumph Financial, one of the largest payment and factoring providers to the truckload market, acquired Isometric Technologies, which helps brokers and shippers measure the performance of their truckload carriers. In mid-2024, the digital broker Transfix sold its brokerage division to NFI and pivoted to become a technology provider to other brokers. Also this year, Flexport released its Convoy platform for brokers based off its late 2023 acquisition of the technology from the now-defunct digital brokerage. And Uber Freight launched its Broker Access product , allowing rival brokers to access its pool of carrier capacity. Alongside this M&A activity and product releases, a number of technology providers working on a specific type of artificial AI, called AI agents, received funding rounds in the $15 million ballpark to build AI text and voice applications for brokers , including Vooma and HappyRobot. Again, these investments are all linked. Brokers are already using many individual third-party software providers and data suppliers. When those companies combine, they theoretically allow the broker to access more value from fewer systems. But that consolidation is also happening because the existing technology suppliers to brokers know that AI is coming fast . Race is on There is an ongoing reckoning over what humans will do and what programs will do in the brokerage space, and the race to supply tools to both sets of “users” is on. “Larger players will race for an end-to-end offering to make deployment turnkey and easy,” a software CEO and veteran of the brokerage industry told the Journal of Commerce. “And although you’re hearing about these [huge] rounds from productive AI-driven companies, there are a lot of companies from earlier vintages out there dying on the vine.” M&A is a constant in the transportation world. Even outside of technology, there continues to be frothy activity across modes, from Schneider acquiring Cowan Systems to Kuehne + Nagel acquiring a majority stake in IMC Logistics . But the truckload technology space is shaking out with a more rapid pace when it comes to M&A, and it seems likely that pace will continue into 2025. As the software CEO put it, the industry is still struggling to understand what software-as-a-service (SaaS) in truckload is even worth. “At a macro level I’m asking myself every day: What is a SaaS company even worth now?” the source said. “Nobody knows because they don’t go public anymore. With AI advancing so quickly, I think the only thing that matters is the end result and the outcome for the customer.” Contact Eric Johnson at eric.johnson@spglobal.com .

Truckload

Truck brokers

Logistics Technology News

M&A pace signals truckload tech industry unsure about ‘unbundling’

<div class="phx-topic abstract-wrapper">Shippers on the Europe-US trade lane are facing significant rate increases in January as the potential for disruption grows from labor uncertainty and new operating alliances.</div>

Shippers on the Europe-US trade lane are facing significant rate increases in January as the potential for disruption grows from labor uncertainty and new operating alliances.

<div class="phx-topic">Ocean carriers are announcing hefty surcharges on the North Europe to US trade lane starting in mid-January, just when <a href="https://www.joc.com/article/new-year-heralds-triple-threat-to-us-container-shipping-5908327">fresh disruption may erupt</a> from a second longshore strike along the US East and Gulf coasts and the significant restructuring in liner alliances. Mediterranean Shipping Co. on Thursday said it will implement a $2,000-per-FEU “Emergency Operational Surcharge” on the trade lane from Jan. 18. MSC tied its surcharge to the restructuring of its trans-Atlantic network from Feb. 1, when it will <a href="https://www.joc.com/article/mscs-global-scale-enables-standalone-network-coverage-5726563">begin operating as a standalone carrier</a> following its exit from the 2M Alliance with Maersk. “In light of the significant changes in the trans-Atlantic networks to restructure the services [in the] beginning of 2025, we are foreseeing operational disruption during the first months of next year,” MSC told customers in an advisory. The carrier this week began accepting bookings for its new network. MSC’s new surcharge will go into effect just three days after a Jan. 15 deadline for the International Longshoremen’s Association (ILA) to hammer out a new contract with the United States Maritime Alliance (USMX). No deal means a likely second strike by ILA following <a href="https://www.joc.com/article/us-east-gulf-coast-ports-confident-of-smooth-post-strike-reopening-5742607">a three-day work stoppage in early October</a>. Zim Integrated Shipping on Wednesday said it will implement a $2,000-per-FEU “ILA Strike Surcharge” from Jan. 10 that would cover all cargo moving to or from US East and Gulf coast ports “until further notice.” If no disruption occurs, Zim said the strike surcharge would be dropped. A third carrier, Ellerman Lines, told the market this week it would be implementing a “Labor Interruption Surcharge” from Jan. 16 because of “the increased potential for labor disruption at US East Coast ports.” February will also see the start of <a href="https://www.joc.com/article/gemini-faces-13-week-phase-in-before-90-reliability-promise-is-tested-clerc-5783839">the Gemini Cooperation</a> between Maersk and Hapag-Lloyd and the rollout of <a href="https://www.joc.com/article/premier-alliance-enhances-network-ahead-of-february-launch-5751123">the Premier Alliance</a>, the recently renamed THE Alliance of Ocean Network Express, HMM and Yang Ming. <h3>MSC surcharge move a ‘surprise’ </h3>Lars Jensen, CEO and founder of Vespucci Maritime and a Journal of Commerce analyst, said phasing in a new network was not easy and would have a disruptive effect on the market. But MSC using that as the basis to implement a new surcharge came as a surprise, he said. “Usually variations on the topic of ‘disruption surcharge’ are due to external events beyond carrier control, such as port congestion due to ... strikes, weather closures etc ... But in this case the operational disruption is specifically due to MSC’s own actions in creating a new product portfolio — it is not in relation to an ILA strike,” <a href="https://www.linkedin.com/feed/update/urn:li:activity:7275385727482253312/">Jensen wrote in a LinkedIn post</a> Thursday. CMA CGM has also announced a $500/FEU surcharge from Jan. 1 until further notice for Europe to the US and Canada, but is calling it a “peak season surcharge.” Maersk noted in a customer advisory last week that the possibility of a strike on Jan. 15 was increasing without a settled contract between the ILA and USMX. The carrier said it has identified the vessels that could potentially be impacted and was preparing contingency plans. “If a strike occurs, we expect vessel operations to halt by midnight on Jan. 15,” Maersk noted. “The team is working on contingency plans to ensure operations are completed on time and that vessels are not docked during the work stoppage.” Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com</a>. </div>

Ocean carriers are announcing hefty surcharges on the North Europe to US trade lane starting in mid-January, just when fresh disruption may erupt from a second longshore strike along the US East and Gulf coasts and the significant restructuring in liner alliances. Mediterranean Shipping Co. on Thursday said it will implement a $2,000-per-FEU “Emergency Operational Surcharge” on the trade lane from Jan. 18. MSC tied its surcharge to the restructuring of its trans-Atlantic network from Feb. 1, when it will begin operating as a standalone carrier following its exit from the 2M Alliance with Maersk. “In light of the significant changes in the trans-Atlantic networks to restructure the services [in the] beginning of 2025, we are foreseeing operational disruption during the first months of next year,” MSC told customers in an advisory. The carrier this week began accepting bookings for its new network. MSC’s new surcharge will go into effect just three days after a Jan. 15 deadline for the International Longshoremen’s Association (ILA) to hammer out a new contract with the United States Maritime Alliance (USMX). No deal means a likely second strike by ILA following a three-day work stoppage in early October . Zim Integrated Shipping on Wednesday said it will implement a $2,000-per-FEU “ILA Strike Surcharge” from Jan. 10 that would cover all cargo moving to or from US East and Gulf coast ports “until further notice.” If no disruption occurs, Zim said the strike surcharge would be dropped. A third carrier, Ellerman Lines, told the market this week it would be implementing a “Labor Interruption Surcharge” from Jan. 16 because of “the increased potential for labor disruption at US East Coast ports.” February will also see the start of the Gemini Cooperation between Maersk and Hapag-Lloyd and the rollout of the Premier Alliance , the recently renamed THE Alliance of Ocean Network Express, HMM and Yang Ming. MSC surcharge move a ‘surprise’ Lars Jensen, CEO and founder of Vespucci Maritime and a Journal of Commerce analyst, said phasing in a new network was not easy and would have a disruptive effect on the market. But MSC using that as the basis to implement a new surcharge came as a surprise, he said. “Usually variations on the topic of ‘disruption surcharge’ are due to external events beyond carrier control, such as port congestion due to ... strikes, weather closures etc ... But in this case the operational disruption is specifically due to MSC’s own actions in creating a new product portfolio — it is not in relation to an ILA strike,” Jensen wrote in a LinkedIn post Thursday. CMA CGM has also announced a $500/FEU surcharge from Jan. 1 until further notice for Europe to the US and Canada, but is calling it a “peak season surcharge.” Maersk noted in a customer advisory last week that the possibility of a strike on Jan. 15 was increasing without a settled contract between the ILA and USMX. The carrier said it has identified the vessels that could potentially be impacted and was preparing contingency plans. “If a strike occurs, we expect vessel operations to halt by midnight on Jan. 15,” Maersk noted. “The team is working on contingency plans to ensure operations are completed on time and that vessels are not docked during the work stoppage.” Contact Greg Knowler at greg.knowler@spglobal.com .

Container Shipping News

Container lines

Trans-Pacific

Trans-Atlantic carriers cue fresh surcharges for early 2025 risks

Register today to redeem your Gold subscriber discount!

TPM Discount - Gold

Save 20% on TPM25

Use code HSW25 at checkout and save 25% on first year of any annual subscription plan. Offer ends December 29.

Subscribe Now - Free Trials - Wide Box

HOLIDAY SALE

Use code HSW25 at checkout and save 25% on first year of any annual plan. Offer ends December 29.

Subscribe Now - Anonymous - Wide Box

Use code HSW695 at checkout and upgrade to Gold for just $695! Valid for first year of subscription. Offer ends December 29.

Upgrade Subscription - Wide Box

The world of LTL is slow to embrace change. Business anachronisms permeate current supply chain processes. These vestiges of the way things used to work define the LTL freight transportation procurement process of many modern shippers.David Knuth, logistics specialist at IEWC, a global supplier of cable and wire based in Wisconsin, is happy to have modernized the RFP process, automating the entire LTL bidding procedure with Bid$ense, SMC³’s automated truckload and LTL freight transportation sourcing solution. But when prompted, he can still recall what once was.In his previous job, a large part of his duties were consumed by creating an intermodal bid package for carriers. In a spreadsheet, Knuth detailed the company’s volumes lane by lane, taking care to delete any errant keystrokes or misleading data. He would then email out the information to each carrier, taking time to respond to detailed technical questions about the spreadsheet data. Finally, he had to compile all the results, create an algorithm that would compare the carriers on each lane, and award the business.“It was a huge undertaking. It took about four months to do,” Knuth said of the old process. “It was almost a full-time job for that part of the year, every year.”In his new job at IEWC, he sat down with Bid$ense on day one and was amazed at the capabilities. Knuth had never before used a bid tool. SMC³’s latest versions of Bid$ense automate the process even further, taking truckload and LTL RFPs entirely online. The tool draws on RFP best-practices protocols to streamline the bidding communication process, enabling bidding carriers to respond accurately and promptly to shipper requests. The solution also does all the distribution work automatically, electronically submitting shipper bid data to carriers based on their actual service capabilities and performance records. Carriers are alerted with timely prompts for RFP deliverables, so shippers aren’t waiting by the phone for responses.Another benefit of automating the process is the data-cleansing assistance. When Knuth sent spreadsheets to carriers, data errors might cloud the bidding process; he might have to resend data or simply accept a price that did not truly reflect the costs of doing business. Data cleansing is incredibly beneficial, he said.The spreadsheet technique also made bidding analysis an onerous task. Since Bid$ense automates and streamlines the entire RFP process, intensive examination is now simple. SMC³ knows that each bid has more than one best outcome. With uniform responses from each carrier, shippers can quickly rank results and create an unlimited quantity of what-if scenarios to make the optimal procurement decision.Jesse Burnett of Central Garden &amp; Pet experiences many of the same benefits. Founded in 1980, Central Garden &amp; Pet has spent the last three decades growing from a small garden supply company to a provider of a range of products from dog chews and bird seed to soil supplements and natural insecticides. For much of its life, the company shipped these disparate goods via LTL and truckload carriers to retailers throughout the country, relying on each business unit to negotiate directly with their freight transportation providers. This arrangement worked fairly well for a small company, but as Central Garden &amp; Pet expanded, leadership decided to consolidate decision making.Burnett helped centralize the transportation decision making in 2015 with SMC³’s Bid$ense. Before Bid$ense, every business unit operated independently as far as negotiating with carriers.“There were a lot of different things just floating around,” he said. “We didn’t have master agreements in place; no national pricing at all. The pricing from carriers was just all over the place, depending on where you were.”The transformations he saw with Bid$ense were immediate. Burnett has been using the tool about every other year since its implementation at the company. Central Garden and Pet’s $19.6 million 2019 LTL bid saved the company just more than 9 percent when compared to its historical average. For Burnett, though, bid automation extends far beyond savings.“We knew that we weren’t getting the best pricing offer from our carriers just because nothing was centralized,” he continued. “We knew that if we combined everything from all these business units and paired it with one corporate offering, then it would drive some cost benefit with it.”When the company initially decided to centralize bid procurement, executives researched a number of different methodologies and technologies. In the end, though, Burnett found that Bid$ense was both widespread and well known, and that his carrier partners already knew how to use the application. Burnett also highlighted the data-cleansing process as a major benefit, saying the rigorous process ensures that carriers always return the best price.“It definitely has helped drive savings,” he said. “Any time you go out there and you drive that competitiveness with the carriers and they know they’re in a bid environment, it seems to sharpen their pencils.”Transportation procurement is an integral part of the modern supply chain. With Bid$ense, shippers can develop a strategic implementation plan that saves them time and money, but also helps them create strong relationships with their carrier partners. These carriers appreciate the solution’s data-cleansing process; when carriers receive a complete shipment history and future volume forecast, they don’t have to guess on pricing. Carriers that receive more data from shippers get a complete picture of that shipper’s freight, allowing them to accurately plan instead of simply preparing for the worst-case scenario. Clean data presented through an automated system can lead to both bigger shipment savings and a lasting partnership between carrier and customer.Whether customers are looking to streamline over-the-road transportation bidding by automating the RFP process or create an entirely new, centralized sourcing process, Bid$ense has the analytical horsepower to get the job done.SMC³ 2020 Customer Case Study

SMC3rates_shutterstock_5247046.jpg

Shippers save money, time with automated transportation bidding tools

If there’s one immutable truth in the world of logistics, it’s this: LTL is an inherently complex form of transportation. Tariffs, rates, DIM weights, transit times — it’s enough to confuse even seasoned logistics professionals. The solution to this knowledge gap has historically been on-the-job training or university supply chain education, but for a variety of reasons there is now a pressing need for third-party, remote LTL training that prepares logistics workers for transportation success. Global Scope Can Overlook Local Intricacies In the past, professionals looking to move into a supply chain career learned about the basics of supply chain from universities. However, many of these college supply chain programs are now global in scope, focusing on worldwide supply chain management instead of the intricacies of specialized domestic transportation. And even these programs, which used to be widespread, are becoming less common. LTL is not an industry of broad-brush strokes; supply chain professionals really need a pointillistic understanding of the logistics of LTL in order to excel in the industry. Accelerating Need for Dedicated LTL Education This lack of specified training put the onus on employers to prepare new hires with the LTL knowledge needed to do their jobs. Dedicated LTL study is a necessity, not a luxury. At the same time, changes in LTL and the broader supply chain world are accelerating. The reliance on e-commerce has ballooned since the start of the pandemic, and last-mile LTL shipments and related e-commerce strains on the supply chain won’t diminish once social distancing abates. That genie isn’t going back into the bottle. So supply chain employers need logistics workers that are fully versed in all aspects of the industry, ready to solve unique shipping and delivery problems based on their extensive supply chain knowledge But why care about LTL? It’s been reported that some shippers in today’s world are no longer concerned with what mode is used to ship their goods. A Multimodal Approach Ensures On-Time Delivery This mode agnosticism means supply chain stakeholders have to be well versed in all modes of transportation. As unforeseen weather events and other disruptions, such as protests, become more common, savvy logistics employees will need to be armed with familiarity of all modes, not just the most popular, to ensure that freight is delivered on time, without damage, and in the most financially expedient way possible. Offerings like SMC³’s LTL online education courses cover a wide range of topics from LTL basics and operations to more advanced concepts like pricing analytics and transportation law. The company also has plans to continually refresh content, adding new expert presenters and taking the feedback of students to make the courses even better as time goes on. Learn more about&nbsp;<a href="https://logisticstrainingcenter.com/smc3-courses/" rel="noreferrer" class="joc_admin__link">SMC³’s LTL Online Education program</a>&nbsp;and view the 2021 hybrid schedule, featuring live industry experts,&nbsp;<a href="https://www.smc3.com/onlinelearning2021/" rel="noreferrer" class="joc_admin__link">here.</a>

SMC3rates_shutterstock_5247046 (1).jpg

Filling the Supply Chain Education Gap with LTL Education Courses

HOLIDAY SALE: Use code HSW25 at checkout and save 25% on first year of any annual plan. Offer ends December 29.

Subscribe Now - Anonymous - Offer Box

Subscribe Today

HOLIDAY SALE: Use code HSW695 at checkout and save $800 on first year of a Gold subscription. Offer ends December 29.

Upgrade Subscription - Offer Box

Upgrade Subscription

20% OFF ON TPM25: Register today and redeem your Gold subscriber discount!

TPM Discount - Gold 

20% OFF ON TPM25

HOLIDAY SALE: Use code HSW25 at checkout to save 25% on first year of any subscription plan. Offer ends December 29.


Subscribe Now - Free Trials - Offer Box

An in-depth analysis of transport trends in the multipurpose and heavy-lift fleet segment

Breakbulk Report - Rectangle Box

Breakbulk Quarterly

A premium access index of savings using domestic intermodal vs. OTR 

ISI Report - Rectangle Box

Intermodal Savings Index

Customers scoring their intermodal partners to identify the best service providers

Intermodal Service Scorecard - Rectangle Box

Intermodal Service Scorecard

A premium access outlook critical to shippers and transportation providers

QI Report - Rectangle Box

Quarterly Intelligence

The only editorially independent conference for the breakbulk & project cargo industry

Breakbulk Conference - Rectangle Box

Attend Breakbulk25

The premier conference for the global container shipping and supply chain community

TPM Conference - Rectangle Box

Attend TPM25

An extensive dashboard of charts organized by trade lane, mode, and topic

Gateway - Rectangle Box

Gateway

The Journal of Commerce’s surface transport news and analysis focuses on landside transport movement — from railroad news to trucking news — including full load trucking, less-than-truckload (LTL), refrigerated (or reefer) trucking, flatbed and domestic and international intermodal rail, and how it connects with seaports, inland rail hubs, distribution centers and transloading operations. Reporting on the surface transport sector covers the movement of domestic shipments within the United States and international cargoes transported via domestic equipment including trailers and 53-foot containers.

Discover comprehensive trucking news and trends with Journal of Commerce - from trucking LTL to regulation and trucking supply and demand.

Trucking News | Journal of Commerce

Stay updated with our rail transport news and trends. Journal of Commerce covers intermodal news, and port connectivity news in the container rail transport sector.

Rail News | Journal of Commerce

Explore the world of ground transport news - from trucks to railroads, intermodal connections, and port ties. Daily insights on US and global shipments.

Latest News

More News & Analysis

FedEx to spin off industry-leading FedEx Freight LTL division

IMCs dealing with rail service disruptions amid unusually high volumes

Reefer cargo bottlenecks could improve after US scraps warehousing policy