Technology is transforming the automotive and logistics industries. But for many supply chain managers the biggest headaches are still the most familiar ones, such as driver and transport capacity shortages, lost containers, poor forecasting and incomplete visibility. Just this morning, The Wall Street Journal featured how Deere & Co. is raising equipment prices to make up for rising freight transport costs. The equipment maker is a host of U.S. manufacturers reporting rising expenses as a growing U.S. economy drives up prices for materials and shipping.
Oil prices are going down and they are expected to continue falling with global supply increasing and the summer driving season still months away.
Many drivers will pay under $2 per gallon in the summer for the first time in over a decade. However, although prices are coming back down Tom Kloza, chief analyst at the oil Price Information Service does not expect the national average to fall to January’s low.
For more on Oil Prices and what this means for Diesel Prices go to The Trucker>>
With the decline in oil prices, sales on the Hyundai’s smaller car with good gas mileage have also declined. With less of an appeal on good gas mileage, Hyundai is looking into going into another type of vehicle. The Korean automaker is now planning on introducing commercial vehicles in the U.S and plans to invest $2 Billion.
For more info go to Consumer Affairs>>
The white house sent the Secretary of Labor to discuss the contract dispute that has been dragging on for 9 months. The Secretary of Labor Thomas Perez urged all parties to resolve the issue quickly. Further delay can risk tens of thousands of jobs and hundreds of millions of dollars.
This contract dispute is truly affecting ports with the port of Oakland imports falling 39% in January. This is occurring at all U.S. West Coast Ports with production down and a breakdown in vessel schedules.
For more info go to WSJ>>
On average fleet maintenance cost 15¢ per mile. This makes fleet maintenance the 3rd costliest vehicle expense behind fuel and equipment costs.
Here are the 4 mistakes you are making.
1. Inconsistent pre and post trip inspections
2. Poor Quality Data
3. Failure to Track Key Metrics
4. Poor Communication
For more go to Ryder’s Blog>>
April 15 is around the corner and many owner operators are feeling the pressure from the affordable care act that will take 1% of income from operators who didn’t have insurance in 2014, in 2015 this percentage will double to 2%. This will make it cheaper to just get the insurance than pay 2015’s penalties. For more information go to OverDrive Online>>
Manufactoring growth seemingly recovered from 2008’s employment levels but a report by nonpartisan Information Technology and Innovation Foundation discovered that most of the growth is just cyclical not structural or a recovery which makes the growth temporary.
Even with the improvements the U.S was still lost about 1 million manufactoring jobs and 15,000 manufactoring establishments since 2000. The only real growth seen is in electronics and computers and even computer production had declined almost 10% from 2000 to 2009.
The third party logistics company C.H Robinson has reached an agreement to buy Freightquote.com for $365 million in cash. Lets see what concept gets you $365 million.
-It took 15 years to get to where they are
-“Quotes from the best carriers with the lowest rates, instantly.”
-Privately held, Freightquote.com is one of the largest internet- based freight brokers in the U.S.
-They have about 1,000 employees
-Freightquote.com provides truckload, less-than-truckload and intermodal services to about 80,000 customers
-It’s net revenue this year is estimated at $124 million
-Freightquote.com allows smaller businesses the technology to find good rates and has easy load acceptance and payment processing.
Holiday season is coming and it’s always been a crazy time for the transportation sector, while everyone prepares, we here at LoadSmart wonder how crazy will it really be? Here are some interesting facts that might affect those statistics.
Consumer Spending Falls and Income Rise slows
In August consumer spending rose .5%, although economists expected another rise in consumer spending for September, it actually unexpectedly fell .2%
The Income Average has been rising this year but september has been the slowest month since last year at only a .2% increase.
– Wages are barely keeping up with inflation
– Slowing increase in real estate prices
-Volatile Stock Market.
Will these patterns continue for October, November and December numbers? What are your predictions? For more go to TT>>
Attention Shippers, the price of transportation is going up for multiple reasons but if you could do something to lower those prices wouldn’t you? Shippers are impairing themselves in the spot freight market. Most shippers release their list of loads to all of the brokers they know looking for the best options. What shippers are actually doing is creating more options for drivers that are not actually there.This creates a hyped up demand for trucks and drivers that are not actually there. (Now we all know there is a huge demand for drivers as a whole, I am addressing the spot market specifically). As this “demand” increases truckers expect higher prices. As the trucking industry evolves the hassle of trying to find trucks for your loads will become easier but for now trying to stop going to multiple brokers, know where the smartest and quickest way to gain access to truckers at low prices are and stop creating false demand that raise prices. Shippers and truckers for more info go to Inbound Logistics>>
Although LoadSmart likes to focus on the trucking industry more so then other transportation outlets, such a large merger could affect the transportation sector as a whole. Canadian Pacific is worth $32.5 billion, while CSX is worth $30 billion, a merger like that would leave us with a transportation company worth over $60 billion. Although Canadian Pacific is pursuing this merger and stating that a merger would help congestion. CSX is a bit ambivalent with their shareholders most likely expecting high premiums for their shares. Mergers in the railroad industry are difficult. LoadSmart will keep you up to date on this. For more info go to New York Times>>
Late California Trucker Amarjit Khunkhun died when the truck he was driving had a critically impaired transmission from leaking transmission fluid that caused the fire. The company that will have to pay the $3.5 million is GMG Trucking of Fresno a one-truck company. For more info go to Overdrive>>
With a driver shortage like none we’ve ever seen before, finally the transportation industry is starting to get smarter. To keep our supply of truckers equivalent to its demand by shippers we have finally started listening to basic supply and demand and compensate our truckers better. Con-Way will hopefully lead the pack.
The article by trucking info.com states “The carrier has been evaluating and implementing changes in its compensation program to reflect the evolving market conditions and ensure competitive pay structures for its drivers, accordign to Con-way.”
The question is why the trucking industry keeps fighting against the evolving market conditions? Con-Way also went on to say they do not believe that others public LTL carriers will follow by example. With the shortage of truckers that will presumably continue to be a problem in the future. We must find a more competitive way to keep these truckers in the transportation sector.
From Eye for Transport
Quick facts, from the broad economical stats (unemployment rate, GDP, US Trade Deficit ) to the Logistical (Truckload freight and Trucking employment)