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Trucking News

MFW Musing’s – April 7, 2021

Industry Insights / April 7, 2021
MFW makes the wheels of transportation FAR less squeaky
We do this by having an extremely high give a dang level, proactive communication, and shooting straight – even if the news isn’t great

Noteworthy news bullets we thought you’d enjoy

  • ·   March Manufacturing output hits highest level in years on various fronts (Source: Institute for Supply Management)
    • ·   March was the 10th consecutive month of growth in US Manufacturing, and was the highest PMI reading since December of 1983
    • ·   17 of 18 manufacturing sectors saw growth in March
  • ·   Manufacturing recovery challenges LTL capacity in the US (Source: The Journal of Commerce)
    • ·   LTL carriers have been running at full capacity for months, and the additional supply of goods that need to be moved is causing a rate increase in the mid to high single digits (%)
    • ·   This is putting pressure on businesses to plan shipments earlier


  • ·    Tight Full Truckload (FTL) capacity won’t ease until later in 2021 (Source: Supply Chain Dive)
    • ·    Spot load postings in March 2021 were up 130% vs March 2020, and even more surprising, up 232% vs March 2019
    • ·    Available trucks were down 7% in March 2021 vs March 2020
    • ·    This capacity constraint has resulted in contract truck rates are ~10% higher year over year
    • ·    Volatility and uncertainty have wisely driven a trend toward shorter-term contracts with carriers.


  • ·   We all knew the FTL market is more fragmented than the LTL market, but here are the #s. In 2020 the 25 largest carriers for each segment made up: (Source: Supply Chain Dive)
    • ·   LTL: 90.7% of Revenue (Total Revenue down 2.7% in 2020)
    • ·   FTL: 8.0% of Revenue (Total Revenue down 2.9% in 2020)


  • ·    Diesel prices rose for 20 straight weeks, hitting $3.194 on 3/22, which was last hit in December of 2018. It has now fallen the past two weeks and sits at $3.144 as of 4/6 (Source: FreightWaves)


  • ·    Class 8 Truck Orders come in at 40,000 in March (Source: Transport Topics)
    • ·    This is a slight decline from February (44,191) but is still well above replacement level


  • ·    Owner Operator FTL model under attack in California (Source: Logistics Management)
    • ·   The model, an essential part of the industry, is under attack in California via the US Congress in Washington DC.
    • ·   This is the same battle Uber and other gig economy companies are fighting
    • ·    Schneider, the nation’s second largest full truckload carrier, has already stopped using California-domiciled owner operators until the issue is settled


  • ·    Airline industry slowdown has affected parcel rates and capacity (Source: Supply Chain Dive)
    • ·    Shippers that rely on shipping cargo via the belly of passenger flights have had to turn to freighters like FedEx Express, because the dip in air travel in the US (down 72% in January 2021 vs January 2020). FedEx Express saw a 21% year over year revenue growth in their Q3, and expects demand for their services to remain strong for the remainder of 2021.


  • ·    Shippers add last mile-carriers to avoid capacity squeeze (Source: The Journal of Commerce)
    • ·    Adding providers to supplement FedEx, UPS, and USPS
    • ·   New providers mainly regional, local, and crowd sourced carriers
    • ·    Goal is to ensure capacity and avoid shipping delays