Less-than-truckload carrier Old Dominion Freight Line (NASDAQ: ODFL) announced a 4.9% general rate increase Monday for freight carried under various general tariff codes. The increase will be effective March 1.
The rate bump follows similar announcements from LTL carriers in recent weeks. The majority of the increases are in the 5% to 6% range, likely indicative of tightening LTL capacity and a rate-disciplined environment.
Saia’s (NASDAQ: SAIA) 5.9% rate increase began on Jan. 18 and logistics provider ArcBest (NASDAQ: ARCB) installed a 5.95% GRI for LTL services starting Jan. 25.
Yellow (NASDAQ: YELL), formerly YRC Worldwide, implemented a 5.9% increase at the beginning of February. Asset-light LTL provider Forward Air (NASDAQ: FWRD) installed a 6% GRI at the same time.
Most carriers implement annual GRIs for noncontractual freight to absorb cost inflation, including driver and dockworker pay increases and ongoing investments in tech and real estate. In 2021, driver recruitment and retention expenses represent one of the biggest cost headwinds for carriers. Fuel expenses have moved higher as well, but separate surcharge mechanisms are in place to capture fluctuations.
During soft freight markets carriers opt out of annual GRIs or issue them realizing only varying degrees of success.
Privately held carrier Estes Express Lines’ 4.6% GRI went into effect Feb. 1. The carrier also announced an $11-per-shipment surcharge for freight in California at the beginning of the year “due to the rising administrative cost of operating in the state.”
FedEx Freight’s (NYSE: FDX) recent GRI ranges between 4.9% and 5.9%. UPS Freight (NYSE: UPS), which was recently acquired in an $800 million transaction by TFI International (NYSE: TFII), announced a 5.4% GRI effective Feb. 22.
“At Old Dominion, we are committed to delivering our premium value proposition of on-time, claims-free service at a fair price. To satisfy our customers’ expectations and deliver on the promises we have made, we must continue to enhance our high-quality service network and systems,” stated Todd Polen, Old Dominion’s VP of pricing services, in the press release.
mrbigr504
That’s what happens when driver’s dont stick together! It’s worse in intermodal! And that right to work state sh-t don’t help either! Waaaaay too much pimp’n going on!
Clemente Ruiz
Those poor OD Drivers are only making 30$ an hour..
Scott
Old dominion does not pay its hourly city drivers any overtime. Saia Estes and XPO only pays overtime after 45-50 hours. How is this not illegal when every other industry by law has to pay overtime at 40 hours. Old dominion drivers work over 50 hours almost every week. I am fortunate to work for a carrier that does pay overtime and I really feel sorry for these guys having to do the same hard work and yet be treated so unfairly.
TCS53
Check your facts. XPO pays OT after 40 or 8. Only in XPO south do you get OT after 45 hours.