The ‘ingenious strategy’ behind most truckers’ least favorite week of the year: International Roadcheck

International Roadcheck Week is hardly the sexiest topic in trucking, but it is a darn-tootin’ important one. Inspectors in the U.S. and Canada halt tens of thousands of trucks for vehicle inspections for a few days every summer or early fall. They remove thousands of trucks and drivers from the road; in 2021, 16.5% of inspected vehicles were put out of service along with 5.3% of drivers.

It’s uncommon for truck drivers to actually get their vehicles inspected at random during most of the year. To avoid International Roadcheck Week, many truckers simply don’t drive during that period of time — which, presumably, means more unsafe vehicles and drivers on the road outside of the inspection blitz. It’s a question that ate at Andrew Balthrop, a research associate at the University of Arkansas Sam M. Walton College of Business.

Around 5% fewer one-person trucking companies are active during International Roadcheck Week. But Balthrop and his fellow researcher, Alex Scott of the University of Tennessee, found a major upside to the inspection blitz — even with all the folks who avoid it. According to their working paper published in March 2021, vehicles are safer a month before and after the inspection period. There’s a 1.8% reduction of vehicle violations, according to Balthrop and Scott’s analysis. Surprise inspection blitzes don’t result in the same uptick of compliance.

I caught up with Balthrop about his research last week at FreightWaves’ Future of Supply Chain conference, and we chatted again on the phone this week about his findings on International Roadcheck Week.

Enjoy a bonus MODES and a lightly edited transcription of our phone interview:

FREIGHTWAVES: For our readers who are not aware of what Roadcheck Week actually is, can you explain a little bit about what it and why it is important to drivers and companies?

BALTHROP: “The International Roadcheck is part of an alliance between the inspectors in Canada and the ones in Mexico and the U.S. to have a unified framework for making sure trucks are safe to operate. That should make it easier to go across borders when you have this kind of unified structure.

“In the U.S., one of these CVSA inspection blitzes is the International Roadcheck that happens for three days in the summer. Usually it’s a Tuesday, Wednesday and Thursday. And usually it’s the first week in June.

“And in it, they focus on Level One inspections, the North American Standard Inspection where they inspect the driver records, the hours of service, the licensure and I believe medical records as well. Then they inspect the truck. It’s an in-depth inspection where the inspector will actually crawl under the truck to look at various things. And these inspections, from the data that I’ve seen, take about a half an hour on average.

“During the Roadcheck Week, they’ll do about 60,000 inspections, so 20,000 a day. They’re going to pull over a lot of trucks, and this can cause a little bit of congestion at the weigh stations and the roadside inspections localities as the inspectors are doing these inspections.”

Roadcheck Week doesn’t catch all truck drivers, but it has a long-lasting benefit to safety

FREIGHTWAVES: So, can most drivers kind of expect to be pulled over? How likely is that?

BALTHROP: “There’s 1 million or 3 million trucks on the road, somewhere around there on any given day. With 20,000 inspections, most drivers still will not get inspected, but there’s going to be a higher proportion of drivers inspected.

“You’re more likely to get inspected on these days. If you don’t have a recent inspection on your record, or if you have a bad recent inspection on your record, you’re more likely to be pulled over on these days.”

FREIGHTWAVES: Your research focused on that it’s just unusual that this inspection is announced, that it’s planned. We were talking before about how normally, if you’re trying to assure quality or compliance, you would not announce an inspection in advance. It would be more of a surprise-type situation.

Can you walk us through why that’s so unusual, or what’s the rationale that you see behind announcing it in advance?

BALTHROP: “It is unusual, and on the surface, it doesn’t make much sense, but it turns out to be kind of an ingenious strategy. So I’ll walk through it here.

“Over the course of a year, there’ll be 2 million inspections of 3 or 4 million trucks out there. The average rate of inspections is pretty low. It’s not uncommon for truckers to go years without having an inspection. With this low inspection intensity, the FMCSA has sort of a problem of, how does it get anybody to abide by the regulations?

“I’m a jaded economist, and I don’t worry or consider too much ethics and morality and all that kind of stuff. It comes down to incentives for drivers to follow these inspections. The incentives do guide behavior. So, how could the FMCSA incentivize drivers to follow these regulations more closely and adhere to the standards?

“They do this by announcing the blitz. This does two things. On one side, it allows everybody to prepare in advance. There’s a bunch of anecdotal evidence out there that people do prepare for these blitzes in advance. They will have their trucks inspected beforehand for any problems. They’ll time maintenance and upkeep in advance to make sure that their vehicles are in order. “They’ll be a little bit more cognizant of the driver-side regulations. One thing we notice in our study is that hours-of-service violations really drop during these extensions, because people see them coming. They don’t fudge the books in any way.”

Owner-operators can evade Roadcheck Week. Big carriers, not so much.

BALTHROP: “The issue with the announcement, on the flip side, is that it allows people to just dodge the inspection entirely. For a long time, people have talked about how owner-operators and smaller carriers time their vacations for this particular time. They could do this for a couple reasons. To avoid the hassle is a nice way to put it, but it also allows you to be noncompliant to avoid the high-intensity inspections.

“You have this balance here that on one side you get the behavior you want with people complying with regulations. That’s the behavior the FMCSA wants. But on the flip side, you get a bunch of people that are kind of outright dodging inspections.

“When you compare these two things on balance, the policy is actually pretty effective because you get a lot of people focused on maintaining their trucks and obeying the rules during that particular week. Especially with the vehicle maintenance stuff, that lasts a long time.

“In our research, we saw that vehicle violations, a month before and up to a month afterwards, is when you still notice your vehicle violations. That trucks are kind of better maintained around these blitzes.

“The ingenious aspect of it is that the FMCSA, by concentrating their inspection resources all at one time and announcing it, they’re making it clear that they’re serious about enforcing these regulations and everybody prepares for it. For the number of inspections that are happening, you get fewer tickets than you would have otherwise expected.

“The FMCSA, they’re putting people through a little bit of a hassle, but they’re not having to write a bunch of tickets to get people to comply. They’re not really punishing a whole bunch of people because, by making this apparent that this is going to happen, people comply and the FMCSA gets what they want essentially without having to come down on carriers too hard.”

A convenient time for a vacation, indeed

FREIGHTWAVES: OK, interesting. And how does this pattern of shutting down, how does that compare for an owner-operator versus a driver for a big fleet?

BALTHROP: “If you’re a motor carrier with thousands of power units, you can’t just pack up and not do business on a particular day. They just don’t have that option. So they get inspected at a higher intensity, and you see the larger carriers kind of more focused on making sure that they’re prepared for these inspections. With so many inspections, the larger carriers are going to be inspected at higher rates. You can really damage your reputation if your equipment isn’t in order on this particular day.

“Versus the smaller carriers, especially if you’re talking about a single-vehicle fleet, an owner-operator type, it is not that difficult to just not work for those three days. And so you see a lot about that.

“In terms of what the roadway composition looks like, if we look at inspection data and relative to a typical day with the usual inspections, on these Roadcheck days, you have about 5% fewer owner-operators on the road than you otherwise would expect.”

FREIGHTWAVES: Wow. And when you say owner-operators, you also mean just like fleets with just —

BALTHROP: “One-vehicle fleets.”

FREIGHTWAVES: OK, that’s interesting.

BALTHROP: “You know, you see a little bit of effect with the smaller fleets, below six vehicles, but it basically disappears by the time you get to a hundred vehicles.

“This effect is being driven by smaller carriers staying off the road in terms of avoidance. You see this goes also how you would expect; it’s also older vehicles that stay off the road. This is correlated with carrier size. The larger carriers use newer vehicles and owner-operators tend to use some of the older vehicles. But it’s particularly the older vehicles that are off the road.

“This makes intuitive sense. Older vehicles are more costly to keep compliant. Maintenance is more costly, and they’ve been around longer so there’s time for more stuff to have broken essentially.

How a truck driver gets stopped for inspection

FREIGHTWAVES: Can you explain a little bit more, the idea of having this inspection history and why it would benefit a larger or small carrier?

BALTHROP: “Getting flagged for inspection is sort of random, but not totally. If somebody notices something obviously wrong with your truck, that’s ground for a more in-depth inspection. Or if you get pulled over for some other reason, this can be grounds for inspection of some type.

“But there’s also the inspection selection service. The computer program that is random, that it randomly flags people in for inspection, but it’s based on your inspection history.

“So if your firm hasn’t been inspected recently, or if your carrier doesn’t have a very dense inspection history, you’ll be more likely to trigger that system to pull you in and have you inspected. If you have a dense inspection history, you’re less likely to get inspected.”

FREIGHTWAVES: So how do you get pulled over for inspection? As a person who only drives a passenger car, my main interaction with being pulled over is, I’m driving down the freeway or wherever, and I get stopped by the police. How does it work for a truck driver? How does getting pulled over or inspected work in that way?

BALTHROP: “The law is that you cannot pass a weigh station without pulling in and getting weighed. At that point they may flag you to be inspected. Now, in the past decade or two, there’s been a bunch of electronic devices that are installed in cabs. You may have heard of PrePass or Drivewise. This allows you to pass weigh stations.

“I don’t have data on how many trucks have the in-cab devices. But from a trucking perspective, they’re so convenient that you don’t have to stop every time you cross a state line. I think the vast, overwhelming majority of trucks have some sort of one of these electronic devices. The DOT inspectors at these roadside inspection points have a dial they can twist essentially about how many people they want to inspect.

“So during the roadcheck inspection week, they’ll crank that dial all the way up and pull everybody over. And if they get too backed up, they might crank it back down a little bit and so on.”

FREIGHTWAVES: OK, interesting. It reminds me of a highly sophisticated E‑ZPass.

A $10 million-plus expense to trucking companies every year … but it’s worth it if just one fatal crash is avoided

FREIGHTWAVES: Zooming out, when we hear about large truck crashes, something like a vehicle maintenance issue is not really the most sexy explanation. But just looking at the FMCSA data, in 29% of all truck crashes, a major factor is brake problems. So it seems like a lot of the truck crashes on the road are caused by vehicle maintenance, versus something like the driver using illegal drugs or some other sort of more dramatic explanation. Can you speak a little bit to why this sort of vehicle maintenance is important for safety in preventing large crashes?

BALTHROP: “We did a little bit of a back-of-the-envelope cost benefit analysis of this. Let me try and make sure I remember it clearly, but we have it in the paper that the cost of this on one side is that you have the compliance costs the firms are undertaking, and then you have to add to that the delay costs from doing this, and then the cost of the inspection itself, having to pay federal inspectors to do this.

“On the benefit side, it reduces crashes. So when we add up, just looking at the cost of what an inspection is, we don’t have a good idea of how to measure the compliance cost. It’d be fun to measure the delay cost, but I don’t have good enough price data on that to get at that cost.

“But if you look at what the cost of an inspection is, it is something like $100 or $120 is what you would pay to have one of these inspections done privately. A lot of people do this in the run-up to inspections, and have it done privately so that you can fix whatever the problems are and be sure that you would pass the FMCSA inspection.

“With that $120 figure, if you aggregate that up to 60,000 inspections or whatever, and you take that in comparison, I’m going to give you a bad figure here, it’s on the order of $10 million. That is about the value of a statistical human life. Looking at this economically, it’s worthwhile if it saves one human life. If you identify just one faulty brake system that would’ve resulted in an accident, you’re getting some value out of the program.

“When you add those other costs in there, we’re going to need to save a couple of lives, but in terms of cost benefit analysis with this kind of stuff, we’re usually looking at orders of magnitude differences in cost and benefits to say something for sure.

“If you can save just a couple lives, this program will pay for itself.”

Time to start inspecting in the winter

FREIGHTWAVES: Then one last question: Is there any rationale for this program happening in the summer?

BALTHROP: “I think part of it is that for the inspectors this gets much harder and much more miserable to do in winter conditions.”

FREIGHTWAVES: That makes sense.

BALTHROP: “Inspectors are less productive. One of the things that we talk about in the paper, that they have in addition to the International Roadcheck, is that they have Brake Week where they focus a little bit more on brake inspections. You have Operation Safe Driver a little bit later on in the summer, usually in September, where it’s a little bit more focused on passenger vehicles and how they drive around these trucks.

“But there’s not one in the winter time. There’s an unannounced brake check that usually happens in May, a surprise inspection that’s just one day. But you’re right in pointing out that it might be worthwhile having one of these in the wintertime. You have this periodic high-intensity inspection that kind of incentivizes everybody to be compliant through the summer.

“But there’s nothing in the winter, so that’s an area. But if I was managing the FMCSA, that would be one of the first questions I ask, ‘Why don’t we have one of these in the wintertime?’”

FREIGHTWAVES: That makes sense. Maybe they can do it in the South or something. Maybe a Miami January inspection …

That’s it for this special bonus MODES. Subscribe here if you’re not already receiving MODES in your inbox every Thursday. Email the reporter at rpremack@www.freightwaves.com with your own tales on International Roadcheck Week or any other trucking topics.

Why the Northeast is quietly running out of diesel

The nozzle of a diesel fuel pump is inserted into the tank of a commercial truck as its driver looks on the bankground.

The East Coast of the U.S. is reporting its lowest seasonal diesel inventory on record. And some trucking companies appear spooked.

The East Coast typically stores around 62 million barrels of diesel during the month of May, according to Department of Energy data. But as of last Friday, that region of the U.S. is reporting under 52 million barrels.

The sharp increase of diesel prices has been a major stressor in America’s $800 billion trucking industry since the beginning of 2022. According to DOE figures, the price per gallon of diesel has reached record highs — a whopping $5.62 per gallon. It’s even higher on the East Coast at $5.90, up 63% from the beginning of this year.

When relief is coming isn’t yet clear, and experts say higher prices are the only way to attract more diesel into the Northeast.

“I wish I had some good news for the Northeast, but it’s bedlam,” Tom Kloza, global head of energy analysis at OPIS, told FreightWaves.

2022 has seen record-setting diesel prices. (SONAR)

Everyday Americans don’t fill up their cars with diesel, but the fuel powers our nation’s agriculture, industrial and transportation networks. More expensive diesel means the price of everything is liable to increase. Trucks, trains, barges and the like consumed about 122 million gallons of diesel per day in 2020.

Patrick DeHaan, a vice president of communications at fuel price site GasBuddy, reported that retail truck stops are hauling fuel from the Great Lakes to the Northeast, calling it “extraordinary.” We’ve also seen anecdotal reports from truck drivers posting company memos:

pic.twitter.com/yFYyjzYMWE
— Craig Fuller 🛩🚛🇺🇦 (@FreightAlley) May 11, 2022

#FuelShortage #DieselShortage #SupplyChainCrisis pic.twitter.com/zVmXlshXN0
— Don Ricardo 👑 🇺🇸 🇩🇴 (@NjPier) May 5, 2022

Pilot Flying J and Love’s, two of America’s largest truck stops, told the Wall Street Journal yesterday that they were not planning to restrict diesel purchases, but were monitoring low diesel inventory.

Not unlike every other supply chain crunch we’ve seen in the past few years, the cause of the Northeast’s diesel shortage is multifaceted. A yearslong degradation of refineries is rubbing against the Gulf Coast preferring to ship its oil to Europe and Latin America.

Here’s a breakdown:

1. The East Coast has lost half of its refineries.

As Bloomberg’s Javier Blas wrote on May 4 (emphasis ours):

In the past 15 years, the number of refineries on the U.S. East Coast has halved to just seven. The closures have reduced the region’s oil processing capacity to just 818,000 barrels per day, down from 1.64 million barrels per day in 2009. Regional oil demand, however, is stronger.

Rory Johnston, a managing director at Toronto-based research firm Price Street and writer of the newsletter Commodity Context, told FreightWaves that refining is a “thankless industry,” with intense regulations that have limited the opening of new refineries. The Great Recession of 2008 led to several East Coast refineries shuttering, but there have been more recent shutdowns too. One major Philadelphia refinery shuttered in 2019 after a giant fire (and it already had declared bankruptcy), and another refinery in Newfoundland shut down in 2020.

Billionaire John Catsimatidis owns a small oil refinery in the US East Coast and several hundred gas stations from Pennsylvania to New York:

“I wouldn’t be surprised to see diesel being rationed on the East Coast this summer.” #OOTT #DieselCrisis https://t.co/9g1e5UIf20
— Javier Blas (@JavierBlas) May 11, 2022

2. It’s a financial risk to bring diesel to the Northeast.

The Northeast has increasingly relied on diesel from the Gulf region. Much of that diesel travels to the Northeast through the famous and much-adored Colonial Pipeline. You may remember the 5,500-mile pipeline from last year, when a ransomware attack shuttered it for nearly a week!

It takes 18 days for oil to travel on the Colonial Pipeline from its source in Houston to New York City (or, more specifically, Linden, New Jersey), Kloza said.

That’s a long enough time to prioritize Colonial pipelines financially risky for traders — or, as Kloza said, “incredibly dangerous” — thanks to a concept called “backwardation.”

Backwardation refers to the market condition in which the spot price of a commodity like diesel is higher than its futures price. It’s only gotten stronger over time in the diesel market, Kloza said. So, a company could send off a shipment of diesel and find that it dropped by $1 per gallon in the time the diesel traveled from the Gulf Coast to New York — er, New Jersey. That could mean hundreds of thousands or more in lost profits, so traders often avoid such a fate.

“We’re not in an era where there are any U.S. refiners or big U.S. oil companies who would ‘take one for the team’ and bring cargo in where it’s needed,” Kloza said.

The desperation is showing in New England and the mid-Atlantic regions. New England diesel retail prices are up 75% from the beginning of 2022, per DOE data. In the mid-Atlantic, diesel is up 67%.

It’s not worth the risk, even amid ultra-high prices. As FreightWaves’ Kingston reported last week, the spread between a gallon of diesel in the Gulf Coast and its New York harbor price is usually a few cents. Last week, that swung up to 66 cents.

But that uptick still isn’t justifying moving oil to the Northeast — particularly when traders can make so much more money selling diesel abroad.

3. Of course, we can blame COVID and the crisis in Ukraine.

The catalyst for this diesel shortage, of course, is the ongoing conflict in Ukraine — particularly Europe’s desperation for diesel after weaning off Russian molecules.

As CNBC reported in March, Europe is a net importer of diesel. Europe consumed some 6.8 million barrels of diesel each day in 2019; Russia exported some 600,000 barrels per day of that. Today, Europe has only eliminated one-third of its Russian diesel, so prices are expected to continue to climb amid that transition. Latin America, too, has been clammoring for U.S. diesel.

The Gulf Coast has been happy to provide such diesel, amid “insane” prices for diesel abroad, said Johnston. Waterborne exports of diesel from the U.S. Gulf Coast hit record highs last month, according to oil analytics firm Vortexa. (The records only date back to 2016.)

Naturally, COVID is also to blame for the Northeast’s run on diesel. Those refineries still retained on the East Coast scaled back during the pandemic due to staffing issues. It takes six months to a year to reignite refineries that were previously shuttered, Kloza said.

The ‘everything shortage’ endures

It’s been a tale as old as, well, last year. An industry is quietly hampered by supply issues for years, or even decades, and COVID pulls back the curtains on its unsteady foundation. It’s particularly jarring for commodities we never thought about before, like shipping containers or pallets, but that quietly underpinned our livelihood all along.

Recall the Great Lumber Shortage of 2020? Big Lumber had unusually low stockpiles of wood by the summer of 2020, thanks to a vicious 2019 in the lumber industry shuttering sawmills and the spring of 2020 sparking staffing issues. (There was also a nasty beetle infestation.) Those in lumber expected the pandemic to slow the economy, not ignite online shopping, construction and housing mania. It meant lumber went from around $350 per thousand board feet pre-pandemic to a crushing $1,515 by the spring of 2021. The lumber price roller coaster persists today.

In diesel, there’s no beetle infestation, but there are plenty of other headaches. It all means higher fuel prices on the East Coast, particularly the Northeast, to lure molecules from the Gulf Coast. And, down the line, probably more expensive stuff for you.

Do you work in the trucking industry? Do you want to say that you hate or love MODES? Are you simply wanting to chitchat? Email the author at rpremack@www.freightwaves.com, and don’t forget to subscribe to MODES.

Updated on May 13 with the latest comments from truck stops.

Exclusive: Central Freight Lines to shut down after 96 years

Nearly, 2,100 employees will be laid off right before Christmas. Central Freight Lines is the largest trucking company to close since Celadon ceased operations in 2019.

Waco, Texas-based Central Freight Lines has notified drivers, employees and customers that the less-than-truckload carrier plans to wind down operations on Monday after 96 years, the company’s president told FreightWaves on Saturday.

“It’s just horrible,” said CFL President Bruce Kalem.

A source close to CFL told FreightWaves that CFL had “too much debt and too many unpaid bills” to continue operating, despite exploring all available options to keep its doors open.

Kalem agreed.

“Years of operating losses and struggles for many years sapped our liquidity, and we had no other place to go at this point,” Kalem told FreightWaves. “Nobody is going to make money on this closing, nobody.”

Central Freight will cease picking up new shipments effective Monday and expects to deliver substantially all freight in its system by Dec. 20, according to a company statement.

A source familiar with the company said he is unsure whether CFL will file Chapter 7 or “liquidate outside of bankruptcy,” but that the LTL carrier has no plans to reorganize.

The company reshuffled its executive team nearly a year ago in an effort to stay afloat, including adding the company’s owner, Jerry Moyes, as CFL’s interim president and chief executive officer. Moyes remained CEO after Kalem was elevated to president in July.

“I think it was surprising that there wasn’t a buyer for the entire company, but buyers were interested in certain pieces but not in the whole thing,” the source, who didn’t want to be identified, told FreightWaves. “Part of it could have been that just the network was so expansive that there was too much overlap with some of the buyers that they didn’t need locations or employees in the places where they already had strong operations.”

Third-party logistics provider GlobalTranz notified its customers that it had removed CFL as “a blanket and CSP carrier option immediately, to prevent any new bookings,” multiple sources told FreightWaves on Saturday.

CFL, which has over 2,100 employees, including 1,325 drivers, and 1,600 power units, is in discussions with “key customers and vendors and expects sufficient liquidity to complete deliveries over the next week in an orderly manner,” a CFL spokesperson said. Approximately 820 employees are based at the company headquarters in Waco.

Despite diligent efforts, CFL “was unable to gain commitments to fund ongoing operations, find a buyer of the entire business or fund a Chapter 11 reorganization,” another source familiar with the company told FreightWaves.

Kalem said the company had 65 terminals prior to its decision to shutter operations.

FreightWaves received a tip from a source nearly two weeks ago that CFL wasn’t renewing its East Coast terminal leases but was unable to confirm the information with CFL executives.

Another source told FreightWaves that some of the LTL carrier’s West Coast terminals had been sold recently, but that no reason was given for the transactions.

At that time, Kalem said the company was “working to find alternatives” and couldn’t speak because of nondisclosure agreements. He said executives at CFL, including Moyes, were trying to do everything to “save the company.”

“Jerry [Moyes] pumped a lot of money into the company, but it just wasn’t enough,” Kalem said.

Kalem said he’s aware that a large carrier is interested in hiring many of CFL’s drivers but isn’t able to name names at this point.

“Central Freight is in negotiations to sell a substantial portion of its equipment,” the company said in a statement. “Additionally, Central Freight is coordinating with other regional LTL carriers to afford its employees opportunities to apply for other LTL jobs in their area.”

As of late Saturday night, Kalem said fuel cards are working and drivers will be paid for freight they’ve hauled for the LTL carrier until all freight is delivered by the Dec. 20 target date.

“I’m going to work feverishly with the time I have left to get these good people jobs — I owe it to them,” Kalem told FreightWaves. “We are going to pay our drivers — that’s why we had to close it like we’re doing now. We are going to deliver all of the freight that’s in our system by next week, and we believe we can do that.”

During the outset of the pandemic, Central Freight Lines was one of four trucking-related companies that received the maximum award of $10 million through the U.S. Small Business Administration’s Paycheck Protection Program (PPP). This occurred around the time that CFL drivers and employees were forced to take pay cuts, a move that didn’t go over well with drivers.

“It all went to payroll,” Kalem said about the PPP funds. “Yes, our employees and drivers did take a pay cut over the past few years, and we gave most of it back, even raised pay over the past several months, but it just wasn’t enough to attract drivers.”

FreightWaves staffers Todd Maiden, Timothy Dooner and JP Hampstead contributed to this report.

Watch: Central Freight Lines’ impact on the LTL market

FreightWaves CEO and founder Craig Fuller reacts to the Central Freight Lines news:

“With Central struggling for many years and unable to reach profitability, it makes sense that they would want to liquidate while equipment and real estate are fetching record prices.”

Central Freight Lines statement

Here is the statement given by Central Freight Lines to FreightWaves late Saturday after reports surfaced of its impending closure:

“We make this announcement with a heavy heart and extreme regret that the Company cannot continue after nearly 100 years in operation. We would like to thank our outstanding workforce for persevering and for professionally completing the wind-down while supporting each other. Additionally, we thank our customers, vendors, equipment providers, and other stakeholders for their loyalty and support.

“The Company explored all available options to keep operations going. However, operating losses sapped all remaining sources of liquidity, and the Company’s liabilities far exceed its assets, all of which are subject to liens in favor of multiple creditors. Despite diligent efforts, the Company was unable to gain commitments to fund ongoing operations, find a buyer of the entire business, or fund a Chapter 11 reorganization. Given its limited remaining resources, the Company concluded that the best alternative was a safe and orderly wind-down. As we complete the wind-down process, our primary goal will be to offer the smoothest possible transition for all stakeholders while maximizing the amount available to apply toward the Company’s obligations.

“Central Freight is in negotiations to sell a substantial portion of its equipment. Additionally, Central Freight is coordinating with other regional LTL carriers to afford its employees opportunities to apply for other LTL jobs in their area. Discussions are ongoing and no purchase of assets or offer of employment is guaranteed.”

Brief history of Central Freight Lines

1925	Founded in Waco, Texas, by Woody Callan Sr.
1927	Institutes regular routes in Texas between Dallas, Fort Worth and Austin.
1938	Dallas facility opens as world’s largest freight facility.
1991	Receives 48-state interstate operating authority, expands into Oklahoma.
1993	Joins Roadway Regional Group and begins service in Louisiana.
1994	Expands into Colorado, Kansas, Missouri, Illinois and Mississippi.
1995	Consolidation of Central, Coles, Spartan and Viking Freight Systems into Viking Freight Inc. is announced. Central’s Waco corporate HQ starts closure.
1996	Becomes the Southwestern Division of Viking Freight Inc.
1997	Investment group led by senior Central management purchases assets of former CFL from Viking Freight and reopens as a new Central Freight Lines.
1999	Expands into California and Nevada.
2009	CFL Network provides service to Idaho, Utah, Minnesota and Wisconsin.
2013	Acquires Circle Delivery of Tennessee.
2014	Acquires DTI, a Georgia LTL carrier.
2017	Acquires Wilson; new division created with an increase of 80 terminals.
2020	Wins Carrier of the Year from GlobalTranz. Acquires Volunteer Express Inc. of Dresden, Tennessee.

Source: Central Freight Lines

Warehouse cramming is about to begin — Freightonomics

nVision Global, is a leading Global Freight Audit, Supply Chain Management Services company offering enterprise-wide supply chain solutions. With over 4,000 global business “Partners”, nVision Global not only provides prompt, accurate Freight Audit Solutions, but also providing industry-leading Supply Chain Information Management solutions and services necessary to help its clients maximize efficiencies within their supply chain. To learn more, visit www.nvisionglobal.com

Warehouse space is at a premium right now and with peak season right around the corner, shippers are starting to scramble for space.

Zach Strickland and Anthony Smith look into what shippers are doing to prepare for the end-of-year crunch. They welcome Zac Rogers from Colorado State University to the show to talk through the industry tightness.

The three also talk about the latest Logistics Managers Index results and what they mean for the fourth quarter of 2021.

You can find more Freightonomics episodes and recaps for all our live podcasts here.

Seasonality pushing rejections and rates higher ahead of the Fourth

This week’s DHL Supply Chain Pricing Power Index: 75 (Carriers)

Last week’s DHL Supply Chain Pricing Power Index: 70 (Carriers)

Three-month DHL Supply Chain Pricing Power Index Outlook: 70 (Carriers)

The DHL Supply Chain Pricing Power Index uses the analytics and data in FreightWaves SONAR to analyze the market and estimate the negotiating power for rates between shippers and carriers.

The Pricing Power Index is based on the following indicators:

Load volumes: Absolute levels positive for carriers, momentum neutral

The Outbound Tender Volume Index at 15,980 is nominally higher now than basically at any point in the past 12 months with the exception of the week prior to Thanksgiving/Black Friday last year. OTVI captures all electronic tenders, including rejected ones, so when accounting for the rejection rate, we can get an even more accurate look at volumes.

OTVI rose through the back half of May into the national holiday and has risen even further since. Throughout the back half of May and into the middle of June, tender rejections declined substantially. Meaning, current volume throughput is actually understated when comparing OTVI now to OTVI in November 2020. After adjusting for rejected tenders, the accepted outbound tender volume index is just 2.2% below the 2020 peak in November. At that time, OTVI surged towards 17,000, but the rejection rate moved in-kind towards its natural ceiling of 28%. So, the total accepted freight tenders in mid-June is comparable to the peakiest of peak seasons in 2020. Incredible.

However, since the middle of June, tender rejections have begun increasing again heading into Independence Day, a time when many drivers spend time off the road with their families. The move higher in OTVI this week has been driven primarily by higher rejection rates, rather than higher freight demand.

Over the past month, the drivers of freight volumes have continued to be imports and from just about every port. The west coast continues to provide seemingly non-stop container ships, while Houston, New Orleans, Miami and Savannah are seeing very strong throughput as well.

It is van volumes that are driving freight markets higher right now. The Reefer Outbound Tender Volume index has tumbled 25% since its all-time high in the weeks after the polar vortex in February. Since Memorial Day, ROTVI has fallen another 10.5%. This is likely a factor of declining grocery demand, but I would expect the trend to reverse course in the near future as summer festivities accelerate.

Dry van volumes pushed higher in the back half of May and into June while reefer volumes have declined significantly.

SONAR: VOTVI.USA (Blue); ROTVI.USA (Green)

The congestion at our nation’s ports has spread from Los Angeles and Long Beach to Oakland, California. The California coastline is a parking lot of container ships, most of which are full to the brim with imports, awaiting berth. As detailed in the economic section, there are some signs that the reversion is underway with Americans paring back spending on pandemic superstar categories in favor of airlines, lodging and entertainment. But spending remains strong despite the moderation, and low inventory levels offset much of the decline that will occur from slowing demand. Real inventories are 3% higher now than pre-pandemic, but real sales growth is far outpacing inventory growth, leading to the lowest inventory-to-sales ratio in decades.

On the manufacturing side, the ISM Manufacturing PMI expanded in May after declining in April. We’ve been in expansionary territory for 12 consecutive months. New orders, production, imports/exports and employment are all growing. The major issues should come as no surprise: Deliveries are slowing, backlogs are growing and inventories are too low.

In all, there are many, many catalysts to keep freight demand strong for the foreseeable future. Americans are traveling and spending on services at a high clip, but the high savings rate is enabling it to occur without a massive detriment to goods spending.

SONAR: OTVI.USA (2021 – Blue; 2020 – Green; 2019 – Orange; 2018 – Purple)

Tender rejections: Absolute level and momentum positive for carriers

After declining steadily from mid-March to mid-May, the Outbound Tender Reject Index has reversed course heading into Independence Day. This is typical for a national holiday as carriers selectively choose loads to bring drivers closer to home. OTRI now sits above 25% for the first time in June.

One of our newest indices in SONAR gives us the ability to compare markets on as close to an apples-to-apples basis as possible. FreightWaves’ Carrier Trend Market Score indices are divided into two perspectives – shipper/broker and carrier. The scores are positioned on a scale from 1-100 and have values measuring van and refrigerated (reefer) capacity. The higher values represent more favorable trends for whichever perspective. For instance, a value near the high-end of the range would suggest very favorable conditions for carriers in our carrier capacity trend score index.

For the past several weeks, capacity disparities have been driven by import volumes. The markets with the tightest carrier capacity coincide with the nation’s busiest ports. Ontario, California, Savannah, Georgia, and Atlanta all have carrier capacity trend market scores of 100.

SONAR: Capacity Trend Market Score (Carriers – VAN)

By mode. Reefer rejection rates tumbled from it’s all-time high in March to under 35% in mid-June before popping higher over the past two weeks. Reefer rejections are still quite high from a historical standpoint at 38%, but are significantly lower than just three months ago when reefer carriers were rejecting half of all electronically tendered loads.

SONAR: VOTRI.USA (Blue); ROTRI.USA (Orange)

Dry van tenders make up the majority of all tenders, so the van rejection rate mirrors the aggregate index closely. Van rejections have surged from ~23% to ~26% over the past two weeks.

Yes, one-in-four loads being rejected is not ideal, but it’s better than 30%. I am unaware of any meaningful signals that capacity is being added at a rate that would change my outlook. With so many catalysts for demand, and many constraints on drivers including the Drug & Alcohol Clearinghouse, driver training school closures and continued government unemployment benefits, the outlook is tight throughout this year and into 2022. That’s not to say we won’t see improvement as consumers revert to pre-pandemic spending habits and drivers enter or reenter the market. But I’m not expecting any quick reversal of this environment; there are simply too many catalysts driving volume and suppressing capacity.

SONAR: OTRI.USA (2020/21 – Blue; 2020 – Green; 2019 – Orange)

Freight rates: Absolute level and momentum positive for carriers

Throughout June, spot rates have moderated while contract rates have pushed higher. The Truckstop.com dry van rate per mile (incl. fuel) has fallen from $3.21 to $3.11 since the beginning of June, while FreightWaves van contract rates have risen from $2.50 to $2.59/mile, exclusive of fuel.

I still believe the Truckstop.com dry van national average will not retest the post-vortex surge pricing that brought spot rates up to an all-time high of $3.30. But, there aren’t many catalysts to bring spot rates down anytime soon either. Demand is unwavering with continued strong consumer goods demand, humming industrial recovery and a potentially cooling, yet still sizzling, hot housing market. And carriers can’t fill enough trucks to keep up with demand.

Prior to the seasonal movements we’re seeing in tender rejections, routing guides generally had been improving through Q2. We should continue to see a convergence between spot and contract rates, but spot rates will remain historically very elevated throughout the summer as demand simply outstrips capacity.

SONAR: TSTOPVRPM.USA (Blue); VCRPM1.USA (Green)

Economic stats: Momentum and absolute level neutral

Several economic releases this week are worth noting.

Weekly jobless claims were released Thursday and give us one of the best close-to-real-time indicators of the overall economy. This week, the data was again very promising as the labor market continues on a bumpy but trajectorially stable recovery path.

First-time filings totaled 411,000 for the week ended June 19, a slight decrease from the previous total of 418,000 but worse than the 380,000 Dow Jones estimate, the Labor Department reported Thursday. Initial claims have held above 400,000 for consecutive weeks after falling to a pandemic low of 374,000 three weeks ago. As things stand, the current level of initial claims is about double where it was prior to the Covid-19 pandemic.

The good news on the jobs front is that continuing claims are on the decline, falling to 3.39 million, a drop of 144,000. That number runs a week behind the headline claims total.

Initial jobless claims (weekly in May 2020-May 2021)

At the time of writing, the newest weekly data for the week ending May 29 had not been updated in SONAR. This week, claims fell from 405,000 to 385,000.

SONAR: IJC.USA

Consumer. Turning to consumer spending, as measured by Bank of America weekly card (both debit and credit) spending data, total card spending (TCS) in the latest week accelerated to 22% over 2019. This is the first time in June that TCS has topped 20% over 2019, but spending has been running up 16-19% consistently on a two-year comp for months. For contect, the average pre-pandemic two-year growth rate was about 8% (from 2012 to 2019).

The Bank of America team highlighted service spending in the nation’s two largest state economies, California and New York, which are now fully reopened. Spending at restaurants is now well above 2019 in both states, and the team believes there is more capacity for spending to accelerate in the states that were slower to reopen given pent-up demand.

There was also a notable acceleration in spending on clothing this week, according to Bank of America. It could be a reversal from some softening in the early weeks of June, or an indication of people refreshing wardrobes ahead of a return to work, more travel and vacations. One tepid statement for freight markets from this week;s report: Leisure spending is on the rise and durable goods spending is flatlining.

FreightWaves’ Flatbed Outbound Tender Reject Index, both a measure of relative demand and capacity, moves directionally with the ISM PMI.

SONAR: ISM.PMI (Blue); FOTRI.USA (Green)

Manufacturing. Over the past two weeks, regional manufacturing surveys have reported generally positive readings amid logistical challenges. The New York Fed’s Empire State business conditions index declined 6.9 points to 17.4 in June, retreating from strong readings the past two months. The Empire State Index is a diffusion index with a baseline of zero; any reading above zero indicates improving or expansionary conditions.

Delivery times lengthened to a new record during the month, new orders and shipments fell, and inventories entered negative territory. The supply chain and transportation challenges are as visible upstream as downstream, but overall the manufacturing sector is handling. Growth continued throughout the second quarter in both the Empire State and Philly Fed indices.

The Philadelphia Federal Reserve’s business activity index edged lower to a still robust 30.7 in June from 31.5 in the prior month. Unlike NY, the pace of shipments growth accelerated in the Philly region during June. The employment subcomponent rose to a very healthy 30.7 from 19.3 last month, the regional bank said.

Record-long lead times, wide-scale shortages of critical basic materials, rising commodities prices and difficulties in transporting products are continuing to affect all segments of the manufacturing economy, but demand remains strong.

For more information on the FreightWaves Freight Intel Group, please contact Kevin Hill at khill@www.freightwaves.com or Andrew Cox at acox@www.freightwaves.com.

Check out the newest episodes of our podcast, Great Quarter, Guys, here.

Project44 acquires ClearMetal to strengthen predictive tools

Project44, a leader in real-time visibility of the global supply chain, announced on Thursday it has acquired ClearMetal, a San Francisco-based supply chain planning software company that focuses on international freight visibility, predictive planning and overall customer experience. The terms of the acquisition were not disclosed.

ClearMetal, founded by top software engineers and data scientists from Stanford, Google and other Silicon Valley elites, has created a “continuous delivery experience” that leverages proprietary machine learning algorithms that can forecast supply chain disruptions.

In an interview, Jason Duboe, chief growth officer at project44, explained that bringing in ClearMetal’s elite team is essential for the company’s future predictive solutions.

“Their team construct is fundamentally different. When you look at their data science, machine learning and computer science background, they are best in class,” he said. “Applying the team to solve really interesting challenges, starting with highly predictive ETA and deeper exception management to create more predictive analytics is really a key component here.”

Project44 recently acquired Ocean Insights to gain global supply chain vessel visibility and has announced it has expanded its truckload tracking services within Asia. Bringing on this new team of engineers will allow the company to capitalize on strong predictive tools, strengthening the supply chain of its customers.

“We’re going to be expanding deeper into Asia, and from a port perspective, getting data much earlier than competitors,” explained Duboe. “Our freight forwarder integrations will give us much deeper visibility from an end-to-end perspective in these regions.”

Along with the acquired skills the ClearMetal team will bring to project44, it brings a large book of customers, including large CPGs, retailers, manufacturers, distributors and chemical companies. These advanced use cases will strengthen the predictive planning tools, and project44 continues to expand into different customer markets.

“What we gain from ClearMetal is a holistic platform for anybody that joins the platform in the future,” said Duboe. “They have large customers with incredibly demanding and advanced use cases. So when it comes to order and inventory, functionality, supplier onboarding, and moving upstream into those processes, we can capture exceptions earlier on.”

Click here for more articles by Grace Sharkey.

Project44 expands real-time visibility into China

Project44 reels in Ocean Insights in ‘largest acquisition in visibility space’

‘Project44’s vision has always been global’

EV Realty opens major truck charging hub in San Bernardino

Aerial view of EV Realty’s new multi-fleet truck charging hub in San Bernardino showing rows of high-power charging ports and parked electric trucks on opening day

EV Realty opened its flagship multi-fleet truck charging hub in San Bernardino on Thursday, bringing 76 high-power charging ports and 9.9 MW of grid capacity online in one of the nation’s busiest freight corridors.

Carriers in the Inland Empire have struggled for years to find infrastructure capable of supporting commercial electrification at scale. This facility is built to change that. It can serve more than 200 medium- and heavy-duty trucks daily under EV Realty’s Powered Properties model, which aggregates multiple fleets onto shared charging infrastructure rather than forcing each carrier to build and maintain its own dedicated depot.

J.B. Hunt Transport Inc., Gate City Beverage (part of Harbor Distributing, a Reyes Holdings company) and fully electric carrier Nevoya have signed on as initial customers.

The site sits near the San Bernardino Intermodal Facility, amid more than 60 million square feet of industrial warehouse space and close to Interstate 10 and Interstate 215 — a critical artery for freight moving out of the Ports of Los Angeles and Long Beach. The region is home to nearly 17,000 medium- and heavy-duty trucks.

“The Inland Empire is where freight from the Ports of Los Angeles and Long Beach gets sorted and sent across the country by truck and rail,” said EV Realty CEO Patrick Sullivan. “Fleets operating here are doing some of the most demanding work in the supply chain. They need reliable, affordable access to high-power charging so they can move beyond pilots and make electrification a real business decision. That’s exactly what we built here.”

The hub deploys Kempower charging hardware, offering up to 1.2 MW for Megawatt Charging System ports designed for next-generation Class 8 tractors and up to 500 kW for Combined Charging System ports standard on current electric trucks. Spring-assisted cables address driver ergonomics. Fleet management software from Synop delivers power management, reservations, reporting and insights on cost, range and efficiency. The site operates 24/7 with on-site staff, security, parking and driver amenities.

By pooling fleets onto shared infrastructure, the Powered Properties approach tackles one of the biggest barriers to commercial EV adoption: the capital cost and operational complexity of building dedicated charging depots.

“EV Realty has been a great partner for us,” said Nevoya Chief Commercial Officer John Verdon. “Their unique design and business model allow carriers like us to optimize operations with cost-effective charging and logistics solutions. The opening of this site provides valuable operational flexibility with both megawatt charging and vehicle domicile options that work well for our needs.”

The San Bernardino hub opened just months after groundbreaking in mid-2025. EV Realty compressed construction timelines thanks to available grid power from Southern California Edison and project partners including ParWest. Grants from the South Coast Air Quality Management District’s Carl Moyer Program and the California Energy Commission’s EnergIIZE Commercial Vehicles Project helped support the build.

The opening marks the latest milestone in EV Realty’s growth, which includes $75 million in growth equity from NGP and additional investment from truck terminal operator Outpost.

Troubled Postal Service moves to raise stamp prices, conserve cash

A U.S. Postal Service van parked in front of a strip mall store, rear first, on a sunny day. Side view.

The U.S. Postal Service plans to raise the price of mail and package services by 4.8% this summer, with a First-Class Forever stamp rising from 78 cents to 82 cents, as part of a broad effort to stem billions of dollars in annual losses.

The national post on Thursday also announced its intent to temporarily suspend employer retirement contributions to the Federal Employees Retirement System to conserve cash and maintain liquidity. The USPS previously suspended pension payments in 2011 during another period of financial stress. That suspension lasted several months, and the USPS later resumed the regular biweekly payments and remitted the withheld amounts.

The national carrier filed notice on Thursday with the Postal Regulatory Commission for the price increases, which are scheduled to take effect on July 12 pending the PRC’s review. The oversight body last week granted approval for the U.S. Postal Serviceto proceed with a temporary 8% surcharge to cover the escalating cost of transportation, especially fuel.

Under the recommended price changes, the additional-ounce price for single-piece letters will remain at 29 cents. The Postal Service is also seeking price adjustments for other First-Class Mail products, periodicals, marketing mail, package services and selected special services products.

At a congressional hearing last month, Postmaster General David Steiner warned the Postal Service could run out of cash in a year unless lawmakers addressed structural policies that impose heavy costs on the agency. He also reiterated the need for continued improvements in operational efficiency and revenue generation, saying he wanted to raise the stamp price to 95 cents.

The USPS had a net loss of $9.5 billion in fiscal year 2025.

“In the midst of the severe financial crisis facing the Postal Service and continued rising operational costs, the Postal Service is using all available tools, including available regulatory pricing authority, to ensure we can continue to fulfill our universal service obligation and serve the American public,” the agency said in a statement. The agency is self funded and doesn’t receive tax dollars for support.

Keep US Posted, an advocacy group of consumers, nonprofits, newspapers, greeting card publishers, magazines and catalogs, complained in a letter to a House subcommittee earlier this week that postal rates are already too high.

“The Postal Service does not have a revenue problem; it has a cost control problem,” wrote Executive Director Kevin Yoder. “Stamp prices have climbed 44% over the past 15 years, and rates for other mail products have risen even more. Yet despite these repeated increases, USPS has still lost more than $25 billion since [former] Postmaster General DeJoy launched the 2021 Delivering for America plan — even after Congress provided $10 billion under the 2021 CARES Act and eliminated $120 billion in liabilities under the Postal Service Reform Act of 2022.” The organization is calling on Congress to limit USPS rate hikes to once per year and cap them to the rise of the Consumer Price Index.

Chief Financial Officer Luke Grossman said current and future retirees will not be impacted if normal retirement cost payments are temporarily withheld.

“The risk to the Postal Service and the American public from insufficient liquidity for postal operations dramatically outweighs any longer-term risk to the pension funds from not making the currently due payments. We will continue to transmit to employees’ contributions to FERS and will also continue to transmit employer automatic and matching contributions and employee contributions to the Thrift Savings Plan. It must be noted that our pension systems remain much better funded than other agencies,” he said in a statement posted on the agency’s in-house news site.

Click here for more FreightWaves/American Shipper stories by Eric Kulisch.

Contact: ekulisch@freightwaves.com.

Amazon signs new delivery deal with Amazon for 20% less volume

Postal Service can proceed with 8% parcel surcharge, regulator says

US Postal Service on brink of collapse, chief tells Congress

Three Strategies for Closing Fleet Risk Blind Spots

Fleet operators tend to think of risk in terms of isolated events, such as a crash, a failed inspection, or a compliance lapse. But according to Bob O’Connell, Account Executive of Strategic Accounts at J.J. Keller & Associates, that way of thinking is itself the biggest blind spot in the industry.

“A lot of carriers, big and small, believe that their risk is based on isolated incidents,” O’Connell said in a recent appearance on FreightWaves’ What the Truck?!? with host Malcolm Harris. “That’s really not the case. You’re being judged on all of it, the consistency of your entire operation.”

The distinction matters because regulators and plaintiff attorneys alike are looking at patterns, not snapshots. A fleet that performs well on one audit but lacks the operational discipline to sustain that performance over time is exposed in ways its leadership may not fully appreciate until it’s too late.

O’Connell laid out a three-part framework for how fleets of any size can close their risk gaps and move from reactive to proactive postures: operate as though a merger or acquisition is imminent, build genuine regulatory expertise internally, and maintain litigation-ready records at all times.

Run your fleet like someone’s about to buy it

The first strategy O’Connell outlined may sound like it belongs in a boardroom rather than a dispatch office, but the logic is straightforward. A fleet that’s always ready for due diligence is a fleet that’s always ready for scrutiny from any direction, whether that’s an insurance carrier, a federal auditor, or a plaintiff’s legal team.

“A merger and acquisition forces discipline, not only on the financial side, but through the entire operational side,” O’Connell said. “If you’re taking a look at it from that viewpoint, what you’re going to see is that if you’re always ready for a merger and acquisition, you’re always going to be ready for somebody to come in and pull the covers back on your entire operation.”

That readiness, O’Connell argues, has compounding benefits. Fleets that maintain tight operational visibility are better positioned to push back on insurance rate increases, respond to audits with confidence, and demonstrate to outside parties that they’re running a disciplined shop.

“If you’re ready for somebody to be viewing your organization in a very detailed format, you’re ready for a lot of things,” he said. That includes showing your insurance provider how well you perform to get lower rates.

The same principle applies when litigation enters the picture. A fleet with a merger-ready posture already has its documentation organized, its compliance records accessible, and its operational narrative coherent.

Regulatory expertise can’t live in one person’s head

The second pillar of O’Connell’s framework centers on regulatory knowledge, and specifically on why fleets can’t afford to treat compliance as a static competency that lives with a single internal hire.

The Federal Motor Carrier Safety Regulations (FMCSRs) are constantly evolving. The pipeline of changes (from the congressional record to the federal register to state and municipal rulemaking) is broader than most fleet operators realize.

O’Connell says that outside compliance partners exist precisely because no single internal team can track the full scope of regulatory change in real time. “You would have to have a fleet of people to manage that,” he said. “Why not turn that over to a specialist that does nothing else every single day?”

But outside expertise alone isn’t sufficient. The real value comes from pairing external regulatory intelligence with internal operational knowledge.

“It’s not just the regulations,” O’Connell said. “It’s how those regulations affect your organization, because regulations aren’t really one size fits all. You have to be able to look at the regulatory expertise, make sure you understand those regulations, and make sure you’re being notified of when they’re changing and how they’re changing.”

Cookie-cutter compliance strategies fail because operations can be very diverse from one fleet to the next. The regulatory burden looks different depending on whether a carrier is running small-cap package delivery, waste haul operations, or long-haul linehaul, and each type requires its own operational interpretation of the same regulatory landscape.

“You have to have bench strength so that your inside person understands the operation,” O’Connell said. “All of your competitors have to comply with the same regulatory landscape.”

J.J. Keller’s Certified Transportation Regulatory Expert (CTRE) Program bridges the gap between regulatory knowledge and operational application so a fleet’s internal staff can fully understand the FMCSRs and comply with them more effectively.

If it’s not written down, it doesn’t exist

Litigation-ready record keeping may be the most immediately actionable of O’Connell’s strategies, and it’s where the consequences of failure are most visible.

Both regulators and plaintiff attorneys evaluate fleets holistically, not on the merits of a single event. When records are organized, accessible, and comprehensive, it fundamentally shifts the dynamic of any legal or regulatory engagement.

“What better way to demonstrate, not only to a regulatory official, but also a plaintiff attorney, that you have everything wrapped up pretty tight?” O’Connell asked. “It’s great to be able to demonstrate that your records are easily accessible and easily produced for any regulatory agency or a plaintiff attorney. That immediately changes the tone of the whole conversation.”

The inverse is equally true. When records are disorganized, incomplete, or difficult to produce under pressure, it invites deeper scrutiny and raises the risk of any enforcement action or lawsuit.

“If it’s not written down or you can’t produce it, it doesn’t exist,” O’Connell tells clients.

Spoliation, the obligation to preserve records once litigation is reasonably anticipated, is a practical example of why record-keeping discipline can’t be built after the fact.

“If you are going to get into litigation or you believe that you could be getting into litigation based upon an incident, you have a legal responsibility to start gathering all of those records and to not destroy any of those records,” O’Connell said.

Build the system before you need it

If there is any single change in thinking that would make the biggest difference for fleet leaders, O’Connell says, it’s a change in posture.

“The safest, most resilient fleets that I’ve come across in my thirty-seven year career don’t react to enforcement,” O’Connell said. “They build defensible systems right into their operations all the time so that when somebody comes knocking, whether that be an enforcement official, whether that be a plaintiff attorney, they’re ready to go.”

That readiness, he argues, is also a competitive advantage.

“You can’t control a lot of the things that are going on in your fleet on the road every single day, but you can control the systems that you have there.”

The time to build those systems is before they’re tested, not during a crisis.

“You don’t want on-the-job training when it comes to this kind of stuff,” he said. “Make sure that your systems are already up to speed and you’re ready to go before something happens.”

To learn more about J.J. Keller & Associates, click here.

Project44 unveils fleet of AI agents at customer event Decision44

On April 9, 2026, Project44 CEO Jett McCandless stood before customers at the company’s Decision44 event and delivered a sweeping history lesson that doubled as a mission statement.

From the agricultural surplus of 10,000 BC that enabled civilization, to Rome’s maritime empire, the Silk Road’s intermediaries, the compass that unlocked ocean navigation, the 13th-century bill of lading, the printing press and the standardization of information, railroads (and the invention of time zones), electricity, the telegraph, the 1956 shipping container that slashed loading costs from 58.6 cents to 16 cents per ton, and the birth of EDI during the Berlin Airlift, every major transformation, McCandless argued, produced a new supply chain model as its primary consequence, not a side effect.

“What if their systems moved at the speed of thought?” McCandless asked, framing the current moment as the culmination of 12,000 years of human logistics breakthroughs.

In the 1990s, the internet brought retail and finance into real-time data, “but logistics kept picking up the phone,” he said. When McCandless entered the industry in 1999, it still ran on phones, faxes, emails and AS/400 systems. “The hardest working people in the world” were making million-dollar decisions with partial information because their systems failed them. The real constraint, McCandless insisted, was never human effort—it was the systems around the humans.

Project44’s 2014 founding was an attempt to fix that. The company spent a decade and $1.5 billion in R&D to build what McCandless called the connective tissue the global supply chain lacked: “We turned the lights on.” The result was visibility at unprecedented scale and a logistics data graph that captured more than 1 billion customer-created events per day and 4 petabytes of data monthly, the equivalent of watching YouTube 24/7 for 9,000 years.

But visibility brought chaos and analysis paralysis. The signal-to-action ratio was just 2 percent. The industry became informed, yet frozen. “What if this is as far as we go?” McCandless recalled asking himself. “What if we gave the world a clear view of its problems, but we can’t solve them fast enough?”

The answer, unveiled during Decision44, is a new class of AI agents that collapse the three-step lead time—truth, decision, action—into a single motion. A process that once took days now takes seconds. “Agency is a dial you control,” McCandless said. The technology is no longer the bottleneck. The last remaining constraint is the processes built around it: every approval chain, sign-off and “let me see.” The hardest part of what comes next “isn’t technology… it’s new processes.”

Building trusted AI for the supply chain

Chief Strategy Officer and Chief Operating Officer Jonathan Scherr picked up the thread, declaring the company’s mission unchanged—“to eliminate friction from global trade”—but now executed through AI that enterprises can actually trust. McKinsey estimates AI’s enterprise impact at $8 trillion annually, yet only 1 percent of global enterprises consider their AI mature. In supply chains, where the cost of failure is measured in lost cargo, stockouts or detained trucks, trust is the gap.

Scherr broke trust into three pillars: Data, Intelligence (logic and reasoning), and Action. Large language models like Claude, GPT or Gemini are powerful at collating public data, but insufficient alone for business use cases. “The data that sits on top of the LLM… is what makes it valuable,” he said. Project44 calls this “context”: the situational knowledge of relationships between pieces of information that lives mostly outside any single organization.

More than 80 percent of AI implementations fail because of insufficient context, Scherr noted. Project44’s decade-long investment in its data graph, interoperability with WMS, TMS, YMS, ERP and OMS systems, and AI agents that proactively reach out to carriers (via the recent LunaPath acquisition) have already delivered measurable gains: more than 25 percent improvement in ETA accuracy.

The company is now embedding “context-fueled intelligence” directly into the platform. Supply chain has its own semantics—“on-time” means something different to every organization—and the system must understand pattern recognition and reasoning. Scherr introduced “Mo,” a context-aware chatbot coming in early July that lets customers upload their own shipment history, business rules and semantic layer for true analysis grounded in their data.

From Autopilot to specific agents: p44’s product roadmap

Nick Ruggiero, director of product management for Autopilot, detailed how Project44 is turning that intelligence into automated, trusted workflows. The agents are configurable, explainable and human-controlled, with granular controls, transparent logic, audit history and intervention points at every critical step. Stored workflows function like a prompt library.

Early results: 17 percent reduction in manual exception handling. Configurable workflows are available today; agent transcripts arrive in May and multi-agent workflows are set to be released in July. Project44 itself is accelerating its pace of production, from shipping one workflow per week to one per day over the summer.

Ruggiero distinguished deterministic workflows (“if X then Y”) from agentic ones that decide and adapt. The architecture decomposes work into tasks, combines semantics and triggers, builds focused micro-agents, tests them in human-controlled Autopilot flows, and introduces supervisory agents capable of orchestrating complex sequences.

At this point in the presentation, numerous product leaders demoed specific agents in rapid succession:

Ilias Pagonis, senior staff product manager for Transportation Planning, attacked the legacy of periodic bid cycles, manual spreadsheet negotiations and slow sequential workflows. Project44’s Freight Procurement Agent replaces them with continuous AI-powered sourcing and simultaneous carrier negotiations in seconds under governed autonomy. Significant results have already demonstrated: 4.1 percent freight cost mitigation, 75 percent reduction in sourcing cycle time, and 70 percent reduction in manual coordination. The Freight Procurement Agent is available now.

Ellie Crist, VP of product management, and Lauren Fitzpatrick, director of data science, tackled logistics operations. Cargo theft losses are up 60 percent year-over-year. New agents automatically detect risk by collating signals like door-open events and GPS spoofing patterns, and cut intervention times from 40 minutes to 12 minutes. Ceva Logistics, a project44 customer, specifically cited p44’s AI capabilities as enabling them to intervene in a shipment “before an incident becomes a loss.”

Inventory management faces late stockout detection and transit variability that inflates safety stock. The Stockout Risk Monitoring and Inventory Risk Agent, also July, closes the gap so the world’s largest automakers can see risk while there is still time to act, which is critical when downtime costs $27,000 per minute in automotive plants.

Last-mile operations can see disruptions, like large weather events, that cascade across thousands of shipments. Project44 already offers predictive ETAs and consumer visibility. New capabilities move from reactive exception management to agentic disruption response: Last Mile Disruptions in June and Agentic Case Resolution in July.

Aron Kestenbaum, VP of product for Yard Management, highlighted the hidden costs after a truck arrives on time. Yards remain manual, siloed and disconnected, with congestion, detention and labor waste in the gap between arrival, unloading and “in stock.” Integrated scheduling, gate optimization, visibility and task orchestration are the solution. The Dynamic Slot Booking Agent arrives in June and is expected to reduce detention time by 17 percent, improve yard optimization by 8 percent and save 10 hours per week on manual coordination.

Abercrombie & Fitch’s Kristen Kravitz on process and people

The most grounded moment came during a conversation between Kristen Kravitz, Group Vice President of Supply Chain at Abercrombie & Fitch, and Project44 Chief Revenue Officer Rick Turco. Abercrombie has transformed from a standard mall retailer into a lifestyle brand, forcing its supply chain to evolve from cost center to value creator and brand enabler.

Kravitz, now in her tenth year, described rebuilding the team to include operations, transportation technology and supply chain digital solutions. “We’ve tried to embrace a digital-first mindset,” she said. The biggest obstacles were manual workflows, siloed data, third-party systems and predictions built for a stable world that no longer exists. “We’re in the never-normal supply chain now.”

At Abercrombie, inventory discipline is considered paramount; Kravitz says that she considers the trendy, seasonal apparel the company makes to be ‘perishable’ for all intents and purposes. Technology is no longer the bottleneck, Kravitz emphasized: “It’s often now the process and people.” The company shifted teams from transportation mode-focused work to origin-and-destination decisioning and built hybrid data structures with central and embedded supply chain analytics. Cross-functional translation, including translating the language of supply chain operations into financial and planning language, has been key.

Project44 data, combined with Power BI rollout, has been instrumental. “Visibility is really an enabler of more efficient execution,” Turco noted. Kravitz stressed balancing movement data with other systems and the need for end-to-end predictions that incorporate factory production milestones. “By the time a vendor hands over the product… a lot of what is going to happen has already been predetermined,” she said.

Ilias Pagonis on the Intelligent TMS

Pagonis returned to close the tech demo segment by explaining why Project44 is entering the TMS space. Traditional TMS platforms were designed for stable carrier relationships, predictable freight cycles and annual procurement—conditions he believes no longer exist. Many solutions remain on-premise and unchanged for 20 years.

Project44’s Intelligent TMS is “intelligent and unbiased,” acting on vetted carrier performance and market data rather than self-reported snapshots. It is AI-native rather than AI-bolted-on, modular rather than monolithic, and powers the entire shipment journey: procurement, planning, execution, visibility, settlement and payment.

Pagonis highlighted the AI value gap: 96 percent of transportation leaders say continued AI investment is a top priority, yet only 13 percent of logistics professionals report measurable value today. “Vanity AI projects won’t deliver value nor survive the next budget cycle.”

He demoed the Execution Recovery Agent, which instantly identifies the next carrier and contacts them. Additional agents launching later this year include Freight Procurement, Load Consolidation, Appointment Scheduling and Freight Audit.

“The only modular TMS on the market,” Pagonis declared. One control layer provides infinite flexibility. Customers can start where value is highest and scale on their terms—no multi-year migration required.

The bottom line

Decision44 made clear that Project44 is no longer content with visibility. It is handing execution to AI agents while keeping humans in the governance loop: “Let the agents handle the grind; your job is to govern the dials.” From freight procurement to cargo theft prevention, yard slotting to last-mile disruption response, the company is releasing purpose-built agents on an aggressive timeline: some live now, most by July.

For an industry still recovering from pandemic shocks, facing 60 percent higher theft losses, volatile freight markets and never-normal conditions, the promise is systems that finally move at the speed of thought. Whether the processes and people can keep up (as Kristen Kravitz candidly noted) will determine how much of that $8 trillion AI opportunity actually lands in supply chain P&Ls.

Jett McCandless is betting the next 12,000 years of logistics history begins today, with agents that don’t just see problems but act on them quickly, transparently, and under human governance. The lights are on. Now the machines are moving.

Biggest US port getting a big check for fix-ups

The U.S. Army Corps of Engineers has allocated approximately $70 million to the Port of Los Angeles for harbor maintenance, seismic resiliency and navigational safety improvements.

The funds, from the Harbor Maintenance Trust Fund (HMTF), totaled a record $131.8 million for the San Pedro Bay complex, the busiest container gateway that includes the Port of Long Beach.

While Los Angeles and other “donor ports” contribute over half of the total funding to the HMTF through a tax on import cargo, they have traditionally received less than 3% of that funding back for harbor improvements. Reforms enacted in 2020 established a framework to address this imbalance and an initial round of funding was allocated to donor ports in Fiscal Year 2024. However, no funding was allocated in fiscal 2025, leading to additional reforms enacted this year that ensure consistent implementation of this equitable funding formula.

Congress appropriated $3.245 billion in HMTF funding for fiscal 2026; $416.8 million specifically for maintenance of donor and energy ports through the Water Resources Development Act.

LA in 2025 generated $301 billion in trade and handled the equivalent of 10.2 million containers.

“After years of donor and energy transfer ports being shortchanged, I’m pleased to see the Army Corps finally implementing the reforms Congress enacted in 2020 to ensure these ports receive their fair share,” said Democratic Sen. Alex Padilla, in a statement. “When I raised this directly with Assistant Secretary [of the Army Adam] Telle earlier this year, he committed to following the law – and this funding reflects that commitment. These investments will allow the ports of Los Angeles and Long Beach to move forward on critical infrastructure and maintenance projects, including seismic upgrades, wharf repairs, and other essential improvements that keep our supply chains strong and resilient.”

Calling the port a leading economic driver for California and the U.S., Sen. Adam Schiff, also in a statement, said, “These critical funds will address long overdue maintenance projects and safety upgrades – ensuring the port remains one of the finest global trade hubs in the world.”

LA has a punchlist of more than $6 billion in navigational maintenance and repair projects, said Port Executive Director Gene Seroka. “With this support, repairs can move forward more quickly, ensuring that our Port’s infrastructure continues to meet world-class expectations.”

The port plans to use its HMTF allocation for priority projects that include dredging, seismic safety upgrades, wharf and fender repairs, pile replacements, sediment removal and remediation, and improvements to slips and channels.

Read more articles by Stuart Chirls here.

Related coverage:

Ocean rates rise as Hormuz makes fuel top concern

New tolls could add $1 a barrel to Hormuz oil

Trump budget boosts military shipbuilding spending by 242% to $65.8 billion

Montreal port chief exits after just two years on the job

New business: South Carolina rail route will see first trains since 2012

Palmetto Railways is reactivating operations on its 40-mile Salkehatchie Subdivision, a former short line through Hampton and Colleton counties in southwestern South Carolina that last served customers in 2012.

With two new customers building facilities along the line, the state-owned railway has invested more than $3 million in route rehabilitation including bridge improvements, tie replacement, track servicing, and upgrades to safety equipment. An additional $6.5 million in infrastructure work is planned over the next two years.

The Salkehatchie Sub, which interchanges with CSX at Hampton, S.C., is currently seeing training of train crews, along with continuing maintenance-of-way activities. Railcar movements are expected to begin later this month. With train movements beginning late in March, Palmetto has begun a campaign to raise local rail safety awareness, working with county leadership, local law enforcement, and fire and emergency services.

Jennifer Brown, Palmetto’s director of industrial development, said in an email that Heidelberg Materials has begun development of its facility along the railway. Heidelberg, a supplier of cement, aggregates, ready-mixed concrete, and asphalt with more than 450 U.S. locations and about 9,000 employees, announced plans in 2025 to locate on the line. Also, wood products company Boise Cascade will begin construction of a new facility this fall.

The railroad continues work with the state Department of Commerce, Colleton County Economic Alliance, and Southern Carolina Regional Development Alliance to recruit additional clients to rail-served locations including the Colleton Mega Site, a 1,481-acre industrial park, and the Stokes Tract, a 457-acre parcel adjacent to I-95 as well as the railroad. Both are in Walterboro, S.C.

The Salkehatchie Subdivision is the former Hampton & Branchville Railroad, which ceased operations in 2012 following the closure of the South Carolina Electric & Gas Co. (now Dominion Energy) Canadys Station coal-fired power plant. Palmetto Railways and Colleton County purchased the line in 2017 through a partnership with the state of South Carolina. Since then, Palmetto has used the line for railcar storage.

Palmetto Railways operates four non-contiguous sections of right-of-way in the state, with a fifth – a new route to connect to the Camp Hall Industrial Park and its Volvo assembly plant – expected to be completed this summer.

Subscribe to FreightWaves’ Rail e-newsletter and get the latest insights on rail freight right in your inbox.

Related coverage:

Norfolk Southern awarded control of disputed eastern port rail line

Best month in years marks broad US rail recovery

Maryland Senate expects to pass two-person train crew bill

APM Terminals wraps up $73M rail expansion at Port of Los Angeles

FedEx, pilots agree on tentative contract after 5 years of talks

FedEx pilots stand on a picket line with signs.

Unionized pilots at FedEx Corp. are on the brink of a new labor contract after five years of acrimonious bargaining. The Air Line Pilots Association late Wednesday announced that negotiators for the pilots and the company had reached a tentative agreement on a five-year contract with the help of the federal government’s National Mediation Board.

Pilots will receive a 40% increase in their hourly pay and other benefits, according to a copy of the agreement posted on a union website.

ALPA said the tentative agreement must still be reviewed by the FedEx pilots’ union board, known as the Master Executive Council. The board is scheduled to meet next week, according to a union source. If the MEC approves the deal, it will be presented to rank-and-file members for a ratification vote. No dates for either event were disclosed.

FedEx (NYSE: FDX) has slightly less than 5,000 pilots, down from 5,800 two years ago. About 20 pilots per month retire from the airline and the union says others have quit.

In a statement, the company described the contract as better than ones for peer pilot groups at other cargo airlines. “This tentative agreement reflects our commitment to our valued crew members and to our growth strategy for the airline and the business as a whole,” said Richard W. Smith, chief operating officer, International and chief executive officer, Airline. “It’s a win-win for our pilots, for FedEx, and for our customers around the world.”

FedEx pilots in July 2023 voted down a tentative agreement to amend their contract, which would have increased pay by up to 30% over a five-year period. The rejection of the deal exposed a major rift among union members, leading to the ouster of the MEC board by hardliners who felt union leaders were too willing to accept management proposals. Union leadership endorsed the tentative agreement as leadership endorsed as delivering industry-leading improvements on pay, retirement and work-life balance.

In early 2024, the union asked the National Mediation Board to declare an impasse and release the parties from mediation, the first step necessary to launch a strike action.

The pilots union has long argued that FedEx’s improved financial performance demonstrates it can afford a better compensation package.

FedEx last month reported strong fiscal third-quarter earnings, exceeding optimistic analyst expectations, and raised full-year guidance again. Corporate revenue increased 8% year over year to $24 billion, beating consensus estimates by $520 million, and adjusted earnings per share hit $5.25 (consensus was $4.09), up 16%, behind yield and volume strength across nearly all package services, plus cost savings from restructuring initiatives. The price of FedEx stock is up 73% over the past year.

In a news release following the earnings announcement, ALPA said pilots helped deliver that performance despite significant adjustments across the network that placed greater demands on frontline crews. FreightWaves reported in December that FedEx travel managers were overwhelmed with flight changes following the post-accident grounding of all MD-11 freighter aircraft during peak shipping season, which resulted in many pilots scrambling to make hotel and ground transportation arrangements on arrival at destination airports. FedEx also recently restructured its air network after losing a large domestic air cargo contract with the U.S. Postal Service and to improve efficiency for parcel and freight shipments.

The union has said cost-cutting under and recent stock buybacks demonstrated management’s indifference to cockpit workers. A key grievance was that FedEx created schedules that were too lean without sufficient use of reserve pilots, forcing many pilots to work overtime and experience fatigue.

“Management willingly disregarded two decades of data that balanced productivity with safety. Our pilots are now asked to do more with less rest and in less time while still operating in unnatural conditions on the backside of the clock,” said Capt. Jose Nieves, chair of the FedEx ALPA Master Executive Council in a news release last year.

Pilots last month said the pressure was showing up in measurable ways, with pilot resignations reaching historic levels.

Click here for more FreightWaves/American Shipper stories by Eric Kulisch.

Contact: ekulisch@freightwaves.com.

FedEx slow to rebook pilots’ hotel rooms amid MD-11 grounding

FedEx pilots pick third union chairman since last summer

FedEx pilots seek release from federally mediated contract talks

Prologis expands global footprint with European joint venture

Logistics real estate giant Prologis is expanding its global footprint, striking a new pan-European joint venture with global investment group La Caisse. The partnership underscores a growing appetite among institutional investors for logistics warehouses amid shifting global supply chains.

The new platform, dubbed Prologis Logistics Investment Venture Europe (PLIVE), will initially include 1 billion euros ($1.17 billion) of logistics properties contributed by both firms. La Caisse will hold a 70% stake in the venture, leaving Prologis with 30% and the role of operating partner. Prologis (NYSE: PLD) will also provide asset management and real estate development services as part of the agreement.

The initial portfolio includes approximately 844,000 square meters of Class A logistics space, giving the venture immediate scale across Europe’s critical logistics corridors in France, Germany, the Netherlands, Sweden and the United Kingdom.

The PLIVE agreement builds on an existing relationship between the two firms, which previously partnered on a Brazilian logistics venture in 2019.

“Our partnership with La Caisse is built on years of working together and delivering results,” said Ted Eliopoulos, managing director of strategic capital at Prologis, in a news release. “Together, we’re expanding that success in Europe—combining long-term capital with our operating platform to scale high-quality logistics assets across key markets.”

For both companies, the transaction represents a strategic push to capitalize on long-term market fundamentals. Companies are actively reshaping their supply chains and moving production closer to home—trends that require strategically located warehouse space.

The transaction is expected to close in the second quarter. Goldman Sachs (NYSE: GS) is acting as exclusive financial adviser to La Caisse.

“We have seen Prologis’ best-in-class capabilities to drive returns firsthand through our partnership in Brazil, and we are building on our combined strengths to create a truly consolidated pan-European platform,” said Rana Ghorayeb, head of real estate at La Caisse. “This joint venture brings together Prologis’ deep hands-on operational expertise and our vision to actively transform assets to enhance long-term value.”

Last month, Prologis announced the formation of a $1.6 billion joint venture with institutional investor GIC. The GIC capital is earmarked for the U.S. market, specifically funding 4.1 million square feet of build-to-suit logistics space.

More FreightWaves articles by Todd Maiden:

DSV exits Dallas-area contract, 391 jobs cut at Wilmer DC

DSV Contract Logistics is ceasing operations at a major distribution facility south of Dallas, cutting 391 jobs after losing a customer contract tied to a large consumer goods supply chain network.

The Denmark-based logistics provider said in a WARN notice filed Thursday that it will terminate all operations at a third-party logistics facility located at 101 Mars Road in Wilmer, Texas, with layoffs expected to begin April 30 or within two weeks of that date.

DSV did not disclose the name of the customer.

Contract loss drives shutdown

DSV indicated that operations at the site are expected to continue under a different logistics provider.

“DSV is terminating all of its operations throughout the entire facility,” the company said in its notice.

While the job cuts are classified as permanent, DSV added that most, if not all, affected workers could be offered positions by the incoming operator, suggesting a transition rather than a full closure of the site.

The workforce reduction spans a wide range of roles, with the majority tied to warehouse operations.

According to the WARN filing, the largest impacted group includes:

278 forklift drivers
26 warehouse operator specialists
19 drivers and 19 supervisors
Smaller numbers of inventory staff, analysts, and management roles

While DSV said many workers could be rehired by the incoming operator, research on outsourcing and contract logistics suggests transitions sometimes leads to lower wages.

Pay for DSV truck drivers varies widely depending on route type, but local and dedicated contract drivers—such as those tied to large distribution centers—typically earn between $55,000 and $70,000 annually, below long-haul driver earnings and slightly under national averages.

Warehouse wages in Texas generally trail national averages, with forklift operators earning roughly $16 to $18 per hour compared to closer to $20 nationally. The pay gap sometimes explains why large-scale distribution hubs cluster in markets like Dallas-Fort Worth—and why labor costs are often a key lever when 3PL contracts change hands.

Stolen freight recovered: $1m Lego heist stopped in tracks

Credit goes to the deputies at the Kern County Sheriff’s Office Mojave Substation for acting quickly and stopping what could have turned into a much larger loss. Their response made the difference and kept this from moving further.

On April 8, 2026, deputies responded to a call about suspicious vehicles near the 400 block of Silver Queen Road. When they arrived, two box trucks were seen leaving the area and were stopped shortly after. Deputies identified Jose Lopez, 37, of San Bernardino, Ruben Lopez Flores, 25, of Los Angeles, and Freddy Hernandez Polinar, 35, of Chino. During the stops, deputies searched the trucks and found a large amount of Lego products. The volume raised concern, which led to a search of the surrounding area where two freight trailers were located nearby.

Stolen freight found before it could move further

Investigators confirmed the trailers had been reported stolen while in transit from Fort Worth, Texas, to Moreno Valley, California, with an estimated value of about $1 million. Deputies were able to recover both the freight and the trailers before the load was broken down or moved further into distribution. All three individuals were taken into custody and charged with possession of a stolen vehicle, cargo theft, and conspiracy, pointing to coordination behind the movement of the freight.

What stands out is how the load was already being handled. The shipment was still moving through the supply chain, but it was no longer under the control of the intended parties. The freight had been transferred out of the original trailers and into separate vehicles, which shows clear intent to move it again. Once that step happens, tracking becomes harder and the risk increases.

Control shifted before anyone realized it

This is the pattern the industry continues to deal with. Freight does not need to be taken by force to be lost. It can move through normal operations while control shifts in the background, and everything can still look right on the surface. The timing in this case made the difference because deputies stepped in before the freight was split or pushed further. Once a load is broken down or spread across locations, recovery becomes much harder.

The first 24 to 48 hours matter. After that, the chances of recovery drop quickly as freight moves and the trail gets harder to follow. This recovery is a win, but it also shows how quickly things can change once control is lost. The load was already moving in the wrong direction before anyone stepped in, which is exactly where most of the risk sits today. Confidence comes from verification, not assumptions.