Hot Take
Congratulations to the Los Angeles Rams on the Super Bowl win. As a St. Louis native, I was rooting for the Bengals — actually, any team that wasn’t the Rams — but it is what it is. I’m also not the biggest football fan, but between the halftime show and all of the food consumed around the big game, I started thinking about what happens to make the Super Bowl such a spectacle.
First the food: The Super Bowl is the second-biggest eating day of the year, followed behind Thanksgiving. Take a walk down the aisles of your grocery store and there are limits on the number of items you can buy as well as bare shelves. Shoot, the day after the Super Bowl I tried to buy bagels and cream cheese and was met with one lone 4-ounce container (still a case of the non-dairy kind) and four packages of bagels.
As a result of chicken wing prices soaring upward, some restaurants have opted to decrease the amount of wings served or switch to chicken thigh “wings” as a replacement to traditional chicken wings as a way to cut costs. That being said, Americans consume roughly 1.25 billion chicken wings on Super Bowl Sunday.
About 28 million pounds of potato chips, the No. 1 party staple, were expected to be consumed during the game. It’s not football without ice cold beer, but how about 325.5 million gallons?
And then there are avocados — U.S. consumers were expected to eat about 124 million pounds of them during Super Bowl parties. This year guacamole makers paid 59% more for their avocados than last year. Granted the price increase wasn’t a Super Bowl issue, it was a MUCH different issue, but it still affected the prices consumers saw.
I attempted to do the math on how many trucks, but after converting gallons of beer to cases of beer it got weird and let’s just say it takes more than 30,000 trucks to get the chicken wings, beer, avocados and chips across America in time for Super Bowl Sunday.
As for the actual logistics of the teams getting to the game, the art of making an entire stage and concert appear out of thin air and be gone in a second, and the control of the waste generated by fans in the stadium, those are topics maybe for the next Super Bowl.
Quick Hits
TuSimple is gunning to change the capacity game as we know it and I am here for it. TuSimple was the first to complete a nighttime freight run with no humans in the cab and is planning to expand to daytime runs and operations in the Texas triangle of Dallas, Houston and San Antonio later this year. Currently all test drives start with a chase vehicle a couple of miles ahead of the truck to provide additional safety measures for the truck, but those fail-safes will be removed eventually as more trips are completed.
By lowering these additional costs that come with supervising an autonomous vehicle, TuSimple stands to revolutionize the capacity game. If TuSimple can get regular high-volume routes comparable to human driven trucks, then over time it can lower per-mile charges on those high-volume routes.
It might be a bit before we start seeing fully autonomous trucks in the supply chain, but when it happens, it could free up a fair amount of capacity should the driver population continue to decline.
The Ambassador Bridge is resting no more. Late Sunday night the busiest commercial crossing between the U.S. and Canada reopened to traffic both ways. Sunday afternoon the Canadian government cracked down on the truckers and carriers involved in protests and blockades. What started with persuading people to leave turned into the potential to have corporate accounts frozen and insurance on the vehicles suspended. Prime Minister Trudeau invoked the country’s Emergencies Act to keep the border crossing open, restore the flow of goods and allow tow-truck operators to remove semi-trucks blocking the border.
The shutdown of the Ambassador Bridge cost Canada CA$390 million ($306 million) of trade per day the bridge was closed. While the Ambassador Bridge reopened, there are still protests at the border in Coutts, Alberta, and Emerson, Manitoba, forcing those entry points to be temporarily closed. Eleven protesters at the Coutts border were arrested after the police were notified the group had a small cache of weapons and a large amount of ammunition and said they were willing to use force against the police should any disruptions occur to the blockade.
While the busiest artery of trade between the U.S. and Canada has reopened, it still might not hurt to add a few extra days and talk to your customers and shippers and say, “It’ll get there — eventually.”
Market Check
Peep the TRAC on Tuesday! Get you a system that can do it all. In all seriousness, though, the rate from Omaha, Nebraska, to Seattle has done quite the nosedive since the beginning of the year. Capacity is tightening in Omaha, but the spot rates haven’t quite seen the upward pressure, so ship those loads now if you can before the rates swing upward.
How’d the lemonade stand do?
Forward Air hit the all too exciting double-digit revenue growth of 31%, with an adjusted operating margin of 10%, a feat that wasn’t expected until the end of this year. Fourth-quarter earnings per share came in at $1.40 and consolidated revenue was $460 million. Most of the gains are credited with swapping out lower yielding e-commerce shipments for heavier loads tied to the industrial tech sector. As of right now, Forward Air is ahead of schedule to meet 2023 financial targets, numbers it just issued on the third-quarter 2021 call.
Uber Freight has almost turned positive earnings, mostly due to the acquisition of Transplace. Fourth-quarter EBITDA at Uber Freight rose to negative $25 million from negative $41 million a year ago. Total Uber Freight revenue for the quarter was $1 billion more than triple all of 2020’s revenue numbers. The company is expected to generate positive EBITDA in 2022.
The more you know
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Grading Trump’s China trade deal: F
Destinus wants to bring air cargo to the edge of space
Breaking the ice: Coast Guard’s vital role in maritime shipping
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