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Trucking News

MFW Musing’s – November 19, 2021

Industry Insights / November 19, 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

  • Diesel Continues Slow Climb, Rises 0.4 cents to $3.734 a Gallon (Source: Transport Topics)
    • Fuel costs $1.293 more for a gallon than it did this time in 2020.
  • October retail sales see strong gains, according to Dept. of Commerce and NRF (source: Logistics Management)
    • Retail sales grew 1.7% from September to October, and were 10.8% greater than October of 2020
  • There are lots of drivers out there, but they’re finding work elsewhere (source: CCJ)
    • The driver shortage has increased due to retirement of some of the work force.
    • However, the biggest reason for an increase in the shortage has been the migration of the workforce to other supply chain jobs, such as warehousing & storage and parcel and local delivery. Local delivery especially is likely to be a competitor because its fundamentally a similar job but with less federal regulation. Plus you are able to be home every night.
  • Vise likely to tighten around UPS shippers in 2022 (source: Freight Waves)
    • UPS is raising their tariff rates 5.9% in 2022, effective the day after Christmas.
    • Good news though, this will NOT affect shippers that have an established contract with UPS.
    • However, what we’ve been hearing is that UPS is requiring many shippers to sign lengthy contracts that contain renegotiation penalties. Which means UPS can raise rates at its discretion and customers are unable to renegotiate. Be careful with these clauses!
  • US transportation hiring exceeds expectations (source: The Journal of Commerce)
    • Transportation and warehousing hiring exceeded expectations in October, the sector adding 54,400 more jobs than expected (for a total of 97,300 actual jobs).
    • Warehousing and storage employers have hired 121,400 workers since May
    • Trucking employment has increased by 78,100 jobs since February.
    • Both LTL and long-haul truckload employment remain down ~2% compared to October 2018.
  • Infrastructure bill narrowly passes, unlocking $110B for roads and bridges and pacing the way for under-21 driver program (source: CCJ Digital)
    • Not to be lost in the shuffle, the Infrastructure bill includes a training and apprenticeship program for under-21 commercial drivers to haul interstate.
    • In an industry short of ~80k drivers, this will only help.
  • Preliminary October Class 8 truck net orders see declines (source: Logistics Management)
    • October North American Class 8 net orders of 24,500 fell 12% from September, and 39% annually..
  • Cass Transportation Index Report October 2021 (source: Cass Transportation Systems)
    • The expenditures component of the Cass Freight Index, which measures the total amount spent on freight, rose to a new record level of 3.96, up 37% year over year, and up 3.9% from September. The rise from September is mostly due to higher shipping volumes, and to a lesser degree from higher rates.