Better-than-expected industrial production data hides softness

U.S. industrial production increased more than expected in January, driven by a surge in utilities output due to cold weather that obscured underlying weakness in manufacturing and mining, which both declined. The Federal Reserve reported on Friday that industrial production rose 0.5% last month, surpassing economists’ forecasts of a 0.3% gain.

The better-than-expected headline figure comes after a 1% jump in December, which was revised up from the initially reported 0.9% increase. Compared to a year earlier, total industrial production was up 2% in January.

“The industrial production report was choppy in January with obvious weather effects boosting utilities demand and weighing on mining and manufacturing,” said Bill Adams, chief economist for Comerica Bank. “These short-term fluctuations will fade quickly.”

Breaking down the data, utilities output spiked 7.2% in January as frigid weather across much of the country boosted demand for heating. This outsize gain in utilities masked weakness in other sectors.

Manufacturing output, which accounts for about 75% of total industrial production, edged down 0.1% in January after rising 0.5% in December. The decline was led by a 5.2% drop in motor vehicles and parts production. Excluding the volatile auto sector, manufacturing output dipped just 0.1%.

“The decrease in manufacturing output in January was held down by a 5.2 percent decrease in the index for motor vehicles and parts,” the Fed noted in its release.

The mining sector, which includes oil and gas extraction, saw output fall 1.2% in January following a 2% gain in December. The Fed attributed the decline largely to an 18.1% drop in coal mining.

Looking at major market groups, consumer goods production increased 0.8% in January, with nondurable consumer goods rising 1.8% while durable consumer goods fell 3%. Business equipment output jumped 2.1%, boosted by a strong increase in the production of civilian aircraft. Construction supplies dipped 0.2%.

Capacity utilization, which measures how fully firms are using their resources, ticked up to 77.8% in January from 77.5% in December. This remains 1.8 percentage points below its long-run average from 1972 to 2024.

Manufacturing capacity utilization edged down 0.1 percentage point to 76.3%, staying 1.9 points below its long-run average. Meanwhile, utilities capacity utilization surged to 75.7% from 70.8% in December.

(Chart: United States Federal Reserve)

The mixed report suggests the industrial sector continues to face headwinds from high interest rates and a shift in consumer spending toward services. However, easing supply chain pressures and moderating inflation are providing some support.

“Manufacturing business surveys show many of the industry’s leaders think they have more to gain than lose from protectionist economic policies,” Adams noted, pointing to potential policy shifts that could boost the sector.

Looking ahead, economists expect the industrial sector to gradually improve over the course of 2025 as interest rates potentially decline and global growth picks up. The Fed’s latest projections show industrial production rising 1.5% in 2025 after an estimated 1.2% gain in 2024.

However, risks remain tilted to the downside amid geopolitical tensions, tight monetary policy and the potential for a broader economic slowdown. The manufacturing sector in particular faces ongoing challenges from tepid export demand and the lagged effects of interest rate hikes.

“2025 will likely mark a better year for manufacturing output after declines in 2023 and 2024,” Adams said, while cautioning that a robust rebound is not guaranteed.

Economists will be closely watching upcoming data on retail sales, housing starts and regional manufacturing surveys to gauge the health of the industrial sector and overall economy in the early months of 2025. The Fed’s next policy meeting in March will also be pivotal in shaping the outlook, as markets anticipate potential rate cuts later this year that could help bolster industrial activity.

The January industrial production report paints a picture of an industrial economy that is, at least for now, holding up better than expected to start the year, even as significant weak spots remain.

Flatbed operator and aggregator PS Logistics holds on to debt rating at Moody’s

A rating action by Moody’s on flatbed operator PS Logistics – a company that has made numerous acquisitions in that field in recent years – is noteworthy more for some of the information it reveals about the privately held business than for any change in its financial status.

PS Logistics, the operating name for parent company Carriage Logistics, recently saw its debt ratings from Moody’s (NYSE: MCO) hold steady across several different classifications.

Its corporate family rating stayed steady at B2, which is five notches below the cutoff for investment-grade debt ratings. Its probability-of-default rating also held at B2.

PS Logistics’ rating on its senior secured first lien loan was affirmed at B1, which is stronger than the B2 rating. Its rating on unsecured notes was affirmed at Caa1, two notches below the family rating.

The B2 rating on PS “reflects the company’s position as one of the largest providers of flatbed transportation and logistics services, its solid operational track record through business cycles and adequate liquidity,” Moody’s said in its report. “Further, the rating reflects the company’s moderately high financial leverage, acquisitive financial policy and ongoing capital needs to enhance its fleet of trucks.”

The reference to PS Logistics as “acquisitive” was the only mention in the report of the fact that the company has made multiple purchases in recent months, buying Fluker Transportation in November, Yardy Transportation in March and the flatbed segment of ELS in January 2024. When PS Logistics announced the Fluker deal, it said in a prepared statement that it had acquired 27 trucking companies and five non-asset-based logistics companies since 2016.

Ratings agency has been down on freight

The affirmation of the existing ratings is in slight contrast to recent freight-related actions by Moody’s, which have been distinctly bearish. They have been either ratings downgrades or more frequently, placement of companies on its negative watch, often a prelude to a downgrade.

RXO (NYSE: RXO) got a negative outlook in March; chassis provider Trac Intermodal met the same fate; truck parts supplier Fleet Pride saw a move to a negative outlook; and Forward Air’s turmoil last year led to downgrades by Moody’s and the two other key ratings agencies – Fitch and S&P Global Ratings (NYSE: SPGI) – with the latter hitting the company twice.

Debt ratings on privately held firms reveal significantly less financial data about the companies than quarterly earnings reports provide on publicly traded companies. But the Moody’s report did reveal several things about PS Logistics.

Its fleet comprises more than 4,500 trucks with more than 40 terminals throughout the U.S.
In the 12 months ended Sept. 20, its revenue was about $1.6 billion. Debt rating reports do not generally release information on profitability. But the report said it expects profitability to improve this year.
PS Logistics is expected by Moody’s to be free-cash-flow-positive in 2025.
Its fleet is described by Moody’s as “very young … so we expect new truck purchases to moderate over the next year.”
The outlook on the company was listed as stable: Conditions do not suggest any basis for a ratings increase or decrease in the coming months. That is based not only on Moody’s expectations for greater profitability but also on the projection that the company’s ratio of debt to earnings before interest, taxes, depreciation and amortization will be around 5X by the end of the year. Its current level was not disclosed, but it was presumably higher than 5X.

Moody’s said there could be a ratings upgrade if the company’s EBITA margin is sustained above 6% and the debt/EBITDA margin could be sustained below 4X. A downgrade could happen if debt/EBITA remains above 5X and the EBITDA margin drops below 4%. (EBITA is earnings before interest, taxes and amortization; EBITDA throws depreciation into that number. Moody’s used both numbers in its analysis).

PS Logistics has a $150 million asset-based lending facility that has not been touched and expires in September 2026.

S&P rating steady since 2021

S&P has a B rating on PS Logistics, which is equivalent to the B2 rating of Moody’s. The S&P Global rating has been in effect since September 2021.

Moody’s also said it will be watching the average age of the fleet. If that number significantly increases, it could result in higher operating costs or could be a sign that “the company doesn’t have the financial capacity to invest in its fleet.”

Despite the bearishness of Moody’s freight-related actions in the past year, the ratings agency was moderately bullish, or at least not bearish, on PS Logistics’ prospects.

“We expect PS Logistics’ operating performance to moderately improve over the course of 2025. Lower trucking rates and softer volumes have weighed on PS Logistics’ earnings since 2023,” the agency said. “However, we expect rates to modestly increase in 2025 as excess trucking capacity continues to exit the market.”

Unique driver pay structure

The report also noted that PS Logistics’ driver pay structure is based on a percentage of freight rates, rather than the more prevalent per-mile approach. Moody’s said that system “creates a flexible cost structure and limits significant margin erosion during down markets. Further, it contributes to PS Logistics’ below average driver turnover levels.”

With tariffs looming large over all transportation sectors, Moody’s said PS Logistics could be protected against some of the bigger impacts from the levies because “we believe most of the freight PS Logistics transports is largely produced and used domestically.” But overall, “the impact and uncertainty of tariffs pose a risk to overall volumes and demand in these end markets.”

The bigger picture, Moody’s said, is that “the company is exposed to end market demand that correlates with cyclical industrial production and construction spending in the U.S.”

More articles by John Kingston

For the first time in years, C.H. Robinson’s debt rating is downgraded by S&P Global

Tough freight market hits Echo’s debt ratings, down a notch at S&P

2 agencies cut short-line operator G&W’s rating, cite debt-funded dividend

Borderlands Mexico: Trade fears, CO2 rules hit Mexico’s cargo truck exports

Borderlands is a weekly rundown of developments in the world of United States-Mexico cross-border trucking and trade. This week: Trade fears, CO2 rules hit Mexico’s cargo truck exports; Gebrüder Weiss opens Phoenix location aimed at cross-border trade; Bourque Logistics snags $100M in financing for expansion; Taiwan auto parts supplier plans $70M factory in central Mexico.

Trade fears, CO2 rules hit Mexico’s cargo truck exports

Mexico’s cargo truck production and exports fell in January, distressed by trade uncertainty and newly imposed vehicle emissions regulations, according to Mexico’s National Association of Bus, Truck and Tractor Producers (Anpact).

Exports declined 7.6% year over year in January to 10,985 units, the lowest in Mexico the past four years. Production fell 9.5% year over year to 14,108 units.

The U.S. accounted for 97% of truck exports in January. Canada accounted for 2.7% of exports during the month.

Rogelio Arzate, Anpact’s president, said the threat of 25% tariffs on Mexican exports to the U.S. by President Donald Trump has impacted the automotive sector.

“Mexico and the United States maintain a deep, productive integration, and any trade obstacle would generate impacts on transport companies and the economy in both countries,” Arzate said during a news conference on Thursday.

Arzate praised Mexican President Claudia Sheinbaum for keeping a trade dialogue open with the U.S. and expressed hope that both countries would stay within the rules of the United States-Mexico-Canada Agreement.

“The Mexican government has done very well. So far, it has not taken any action in retaliation, which we believe is appropriate because they are working on what was agreed with the American government,” Arzate said. “Avoiding the tariffs would be important.”

Freightliner was the top truck producer and exporter in Mexico in January, producing 8,005 units, a 1% year-over-year decline from January 2024. (Photo: Jim Allen/FreightWaves)

The 16 members of Anpact in Mexico are Freightliner, Kenworth, Navistar, Hino, International, DINA, MAN SE, Mercedes-Benz, Isuzu, Scania, Shacman Trucks, Foton, Cummins, Detroit Diesel, Daimler Buses Mexico and Volkswagen Buses.

Wholesale sales of heavy-duty trucks in Mexico declined 30% year over year in January to 2,608 units. Retail sales fell 10% year over year to 3,858 units.

Another factor for the export and production decline was the transition to Euro VI/EPA 10 engine technologies, which became mandatory in Mexico as of Jan. 1. The shift to EPA 10 technology is aimed at reducing carbon dioxide emissions in the transport industry in Mexico by up to 90%.

Mexico’s federal clean technology regulation, known as NOM-044, mandates that manufacturers produce or import only vehicles with Euro VI/EPA 10.

“The beginning of 2025 brought with it the expected moderation in sales due to the adoption of the new Euro VI/EPA 10 emissions regulations,” Arzate said. “This change has caused several transport companies to bring forward purchases to the end of 2024 as part of their product planning.”

Freightliner was the top truck producer and exporter in Mexico in January, producing 8,005 trucks, a 1% year-over-year decline from January 2024. The truck maker exported 7,127 units during January, a 3% year-over-year decrease.

International Trucks Inc. was the No. 2 producer and exporter, manufacturing 3,924 trucks in January, a 22% year-over-year drop. The truck maker exported 3,310 units during the month, a 15% year-over-year decline.

Gebrüder Weiss opens Phoenix location aimed at cross-border trade

Austria-based Transport and logistics operator Gebrüder Weiss has opened a facility in Phoenix to meet growing demand for trade between the U.S. and Mexico, according to a news release.

The location will provide air and sea freight transport services, including customs clearance and partial and full truckload solutions.

“Our logistics services in Phoenix are a further building block in the development of Gebrüder Weiss and strengthen our position in this economically strong region,” Mark McCullough, country manager of Gebrüder Weiss North America, said in a statement. “This allows us to offer our customers greater flexibility in their transports and more reliable supply chains.”

Gebrüder Weiss also has facilities in El Paso and Laredo, Texas, that specialize in cross-border transport. In addition, the company recently opened a logistics terminal in Elgin, Illinois, as well as branches in Miami, Denver and Dallas. In Salt Lake City, the company acquired the local freight forwarder Cargo-Link in 2024.

Gebrüder Weiss now operates a network of 17 locations in North America.

Gebrüder Weiss has around 8,000 employees working at 180 company-owned locations in 35 countries.

Bourque Logistics snags $100M in financing for expansion

Bourque Logistics, a provider of rail operations software for industrial shippers, has secured $100 million in financing from investment firm Sixth Street.

The financing will support Bourque’s recent acquisition of AllTranstek, a rail asset management provider based in Downers Grove, Illinois.

“Our partnership with Sixth Street provides us with a robust capital financing solution designed to support the execution of our strategy at this important inflection point for our company,” Bourque President Steve Bourque said in a news release.

Bourque Logistics is based in The Woodlands, Texas, and provides solutions for logistics and freight systems across North America.

San Francisco-based Sixth Street is a global investment firm with over $100 billion in assets under management.

Taiwan auto parts supplier plans $70M factory in central Mexico

Excellence Opto Inc. (EOI) recently began construction of a plant in the Mexican city of Queretaro.

The $70 million facility will generate up to 800 jobs and produce LED lighting components for vehicles. The Queretaro factory will be the company’s first in Mexico.

EOI designs and supplies LED lighting components to more than 40 global automotive manufacturers.

Taiwan-based EOI was founded in 1995. The company employs 1,250 people and has four facilities, including two in Taiwan, as well as locations in Michigan and California.

Truckload rejection rates surge in largest US-Mexico cross-border market

Chart of the Week: Outbound Tender Reject Index, Outbound Tender Volume Index – Laredo SONAR: OTRI.LRD, OTVI.LRD

Shipper requests for truckload capacity are being rejected at the highest rates since the pandemic era in Laredo, Texas — the largest U.S. border crossing market.

The Outbound Tender Reject Index (OTRI) measures the percentage of truckload capacity requests that carriers decline. Since rejecting loads is generally undesirable for carriers, rising rejection rates indicate a tightening market with limited available capacity.

Rejection rates for loads out of Laredo averaged around 3.8% from October through mid-December but surged over 6% just before Christmas and have unexpectedly remained elevated.

Demand alone may not explain the tightening

Since October, demand has been running approximately 10% higher year over year, yet rejection rates only spiked around the holidays. This suggests that demand alone may not explain the market tightening.

One potential driver is uncertainty surrounding U.S. trade policy. Over the past month, President Donald Trump threatened, implemented and then paused tariffs on Mexico, the U.S.’s largest trading partner by value. This uncertainty was anticipated before the election, which may explain the sustained growth in cross-border freight demand as shippers rush to move goods ahead of potential cost increases. However, the rising rejection rates suggest additional factors at play.

Laredo’s unique market dynamics

From an outbound freight perspective, Laredo is a relatively small market. It ranks 48th out of 135 U.S. freight markets, with just 0.7% of total outbound freight volume. Its location — a day’s drive from Dallas and just over a half-day from Houston — makes it relatively remote.

Most notably, Laredo handles far more freight moving out of the region rather than originating there, a trend that has intensified over the past year. When freight markets become heavily outbound-focused, carrier networks can become strained, leading to supply chain inefficiencies.

Pricing matters

In major outbound-heavy markets like Los Angeles, pricing accounts for the additional cost of repositioning empty trucks (also known as “deadheading”). Shippers pay beyond the direct transport cost, covering the expenses carriers incur when relocating equipment.

However, Laredo’s cost to serve has risen even as broader freight rates decline. Carriers have struggled to pass along these repositioning costs, reducing their incentive to prioritize Laredo-bound freight.

Contract rates in key lanes, such as Laredo to Dallas, have increased 13% year over year, according to SONAR’s invoice data, while spot rates in this lane have risen 8%. Yet, these increases have not kept enough carriers in the market to prevent rising rejection rates.

One major reason: Carrier attention remains focused on California, where import-driven demand has stayed elevated for over a year.

California’s freight boom is drawing capacity away

The Los Angeles market appears to be absorbing much of the available truckload capacity. Geopolitical concerns and tariffs have pushed Asian imports to near-pandemic levels, further strengthening demand. Unlike Laredo, Los Angeles is a massive freight hub with longer lengths of haul, making it a more attractive market for carriers.

Currently, Los Angeles-area freight volumes are up 7%-8% year over year, yet rejection rates remain below 3%, indicating a loose capacity environment. With average hauls exceeding 900 miles and rates rising since last summer, carriers are increasingly prioritizing California over smaller, less lucrative markets like Laredo.

Laredo isn’t the only market where capacity is starting to show vulnerability; the Chicago market has also seen rejection rates climb and sustain above 7%.

The overriding theme that a meaningful amount of capacity has left and continues to leave the domestic truckload market may be the biggest reason for the increases in these market-level rejection rates. Carrier networks are becoming more difficult to manage as there is less buffer when shifts in demand arise.

About the Chart of the Week

The FreightWaves Chart of the Week is a chart selection from SONAR that provides an interesting data point to describe the state of the freight markets. A chart is chosen from thousands of potential charts on SONAR to help participants visualize the freight market in real time. Each week a Market Expert will post a chart, along with commentary, live on the front page. After that, the Chart of the Week will be archived on FreightWaves.com for future reference.

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The FreightWaves data science and product teams are releasing new datasets each week and enhancing the client experience.

To request a SONAR demo, click here.

Missouri truck company owner gets 9 years for PPP fraud, other felonies

Christopher Lee Carroll, the Missouri man who set up a trucking company as part of a broader scheme to fraudulently obtain loans under the pandemic-driven Paycheck Protection Plan, has been sentenced to nine years in federal prison.

A jury convicted Carroll in September of three counts of bank fraud, three counts of making false statements to a financial institution, one count of conspiracy to violate the Clean Air Act, 13 violations of the Clean Air Act and two counts of threatening a witness.

Carroll was convicted and sentenced in the U.S. District Court for the Eastern District of Missouri. He was also ordered to pay restitution of $3 million.

Carroll and business partner George Reed owned a timeshare exit company, Square One Group. They submitted their request for a $1.2 million PPP loan, claiming in it that Square One was owned not by Carroll and Reed but by their spouses, according to a recap of the case released by the U.S. attorney’s office. As a convicted felon for earlier activities, Carroll would not have been eligible for a PPP loan.

Carroll used the money to set up a trucking company, Whiskey Dix Big Truck Repair LLC. With the company established, the U.S. attorney said, Carroll and Reed applied for loan forgiveness, “claiming they’d spent the money on payroll and other permitted expenses.”

The pair applied for a second loan of $1.6 million. It was approved and they took $660,000 in what the U.S. attorney referred to as “owner draws.”

The charges of violating the Clean Air Act came from Carroll’s plan to disable emission-control equipment to increase the vehicles’ mileage.

“Carroll asked one employee to ‘take the fall’ for his crimes and told another that he would stop paying for the employee’s lawyer if he talked to federal agents, evidence and testimony showed,” according to the U.S. attorney. “Carroll did stop paying for the lawyer.”

In the sentencing memo, the U.S. attorney called Carroll a “consummate fraudster.” Previous convictions were for felonious restraint and forcible sodomy.

Unlike Carroll, who went to trial, Reed, 70, pleaded guilty in September 2022 to the charges lodged against him. His sentence at the time was for time served.

More articles from John Kingston

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Feds taking another look at truck-broker contract rules

WASHINGTON — The Trump administration has given renewed hope to truck owner-operators that the government will make it easier for them to review broker transaction records to combat alleged price gouging and help ensure they get a fair price for hauling freight.

The Federal Motor Carrier Safety Administration is reopening the comment period for its “Transparency in Property Broker Transactions” notice of proposed rulemaking (NPRM) at the request of the Small Business in Transportation Coalition. The initial 60-day comment period, which ended on Jan. 21, received close to 5,000 comments.

SBTC petitioned FMCSA on Jan. 19 for an additional 14 to 30 days based on the high number of comments coming in at deadline, and to give drivers affected or displaced by the wildfires in Southern California an opportunity to respond to the proposed rule.

“Other potential commenters to the NPRM may benefit from an extension as well,” FMCSA stated in a notice posted on Friday. The new comment period ends on March 20.

SBTC, which claims more than 21,000 members that include small shippers, freight brokers and trucking companies, contends that FMCSA’s proposed broker transparency rule does not go far enough to protect truckers from unscrupulous brokers.

In requesting the rulemaking in 2020, SBTC wanted brokers to be barred from requiring carriers to waive their rights to review transaction records, and called for new regulatory language stating that broker contracts cannot exempt brokers from having to comply with transparency requirements already on the books.

The Owner-Operator Independent Drivers Association also asked for those contract prohibitions, as well as a requirement that brokers automatically provide transaction information within 48 hours of the completion of contractual services.

FMCSA’s proposed rule, which was published for public comment in November, attempts to give motor carriers more leverage in obtaining freight contract information when disputes arise with brokers, but it stops short of the strict requirements sought by SBTC and OOIDA.

Asked to comment, SBTC Executive Director James Lamb told FreightWaves in an email that he appreciates FMCSA’s reopening the comment period.

He added, however, that “something is very wrong” with FMCSA’s approach to the rulemaking based on information showing that the agency had required a major freight broker to remove waiver language in a contract with one of its carriers – a requirement that SBTC wants to end permanently.

“How does FMCSA tell [the broker] in writing to remove the waiver language … in November of 2023 and then not include a prohibition of waivers in the November 2024 rulemaking as we and OOIDA requested?”

FreightWaves has reached out to FMCSA for comment.

The Transportation Intermediaries Association, meanwhile, wrote in comments filed in the docket that the rulemaking is “a solution in search of a problem.”

“Rather than doubling-down on vestigial economic regulations, FMCSA should focus its efforts on addressing highway safety and addressing the proliferating fraud pandemic in the supply chain, which is costing the U.S. economy over $1 billion annually.”

Click for more FreightWaves articles by John Gallagher.

After hurricane, old railcars find new life as bridges in North Carolina

Obsolete railcars are getting a reprieve from the scrapper’s torch to serve as vital road links in an area of North Carolina ravaged by Hurricane Helene.

The North Carolina Department of Transportation and Innovative Bridge Co. are installing retired railroad flatcars as a quick fix to temporarily replace road bridges damaged or destroyed by the storm this past September.

Petal, Mississippi-based IBC has so far installed more than 40 railcar bridges in seven counties.

The company typically installs 180-200 such bridges each year, handling jobs from Texas to Pennsylvania. This was its first disaster response job.

The railcar bridges, paved and with railings installed, are one-third the cost of a typical temporary bridge.

The NCDOT expects to have all bridge reconstruction projects under contract by the end of March and all spans rebuilt within two years.

Related coverage:

Local service still a sticking point for Class I railroads

US rail volume still up in latest weekly statistics

Tax credit would upgrade, expand US rail freight car fleet

Short line eyes Cali market, buys hydrogen locomotive builder

Running on Ice: Big Tech comes to the cold chain

All thawed out

Cold chain giant Thermo King has released the newest lineup in its world of temperature tracking with TracKing Smart Trailer telematics. This telematics component allows fleet operators to manage the complete trailer – both the cargo on board and the actual reefer unit. The goal is to help Thermo King’s sustainability goal of reducing customers’ carbon footprints by one gigaton by 2030.

The new offering gives insights into operational efficiency, featuring real-time alerts on all relevant trailer components. Monitoring features such as antilock brake system health monitor, trailer backing camera and door position sensors support safer trailer operations and help reduce accident risk. Most importantly it aids fleets’ regulatory compliance by providing lights-out detection, brake monitoring and weight monitoring to avoid fines and prevent violations that could impact fleet safety scores.

In a news release, Adam Wittwer, president of Thermo King Americas, said: “As cargo management gets more and more complex, the need for reliable, real-time data becomes critical. The TracKing Smart Trailer telematics system empowers fleet operators to make smarter, faster decisions that help minimize costs, all while reducing environmental impact. This comprehensive solution can enable fleets to operate more efficiently, keep trailers on the road longer, and help their businesses to remain competitive in today’s market.”

Temperature checks

Not only is telematics getting more intelligent, but so are shipping labels. Reelables, specialists in smart shipping labels, has announced a new line of smart shipping labels specifically for temperature monitoring. The 5G cellular labels will provide reliable temperature-controlled visibility at scale at a per-piece level to trace each perishable shipment through the supply chain.

The labels measure temperature from minus 10 to 60 degrees Celsius with pharma-grade, plus or minus-0.5 C accuracy and can be activated with a mobile phone. This real-time tracking helps reduce waste and keep shippers within Food and Drug Administration regulations.

Brain Krejcarek, CTO of Reelables, said in a news release: “Businesses shipping perishable items depend on advanced technology to provide intel on the current location of a delivery truck and the ambient temperature inside the trailer or aircraft. Our 5G temperature label ensures last mile visibility and piece level tracking of perishable shipments, at a price point that expands coverage to nearly all temperature sensitive items moving through the supply chain, not only high-value shipments.”

Food and drug

In a move that likely no one asked for, frozen pizza has expanded to include a new and bizarre offering. Caulipower, a company that specializes in cauliflower-based pizza crusts, has introduced the dill pickle pizza. The pizza features a creamy, white béchamel sauce infused with dill-pickle brine, roasted garlic, mozzarella and fresh dill.

In a news release, Gail Becker, founder of Caulipower said: “This isn’t just a pizza – it’s a flavor revolution. To celebrate the humble pickle’s new celebrity status, we added it to our signature cauliflower crust, offering consumers a veggie-forward option that proves you can still enjoy pizza without compromise. The first-ever frozen dill-pickle pizza? Yeah, we did that!”

I’m not sure that it’s the biggest flex, but if you love pickles then this might be the best news of the day.

Cold chain lanes

This week’s market under a microscope is Memphis, Tennessee. Reefer capacity is tightening as reefer outbound tender volumes plummet 39.26% week over week. On the flip side, reefer outbound tender rejections have risen 225 basis points w/w to 36.89%. Typically, anytime outbound tender rejections rise above 20%, it signals inflationary spot rates in the market.

Given that ROTRI has been above 20% since the middle of December, spot rates keep climbing as shippers and brokers continue to see contract carrier compliance erode amid spot rates that are well outperforming contracted rates.

This is likely impacting bid season as reefer outbound tender rejections aren’t typically this high for this time of the year. As spring rolls around and temps rise above freezing, reefer rejection rates should improve.

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Shelf life

Construction begins for new life sciences facility at Wilmington International Airport

Air cargo delivers for Valentine’s Day

Revolutionizing supply chains: Ndustrial launches Nsight Fleet for efficient transport electrification management

MSC introduces iReefer tracking system

DHL acquires Inmar Supply Chain Solutions, becoming North America’s largest reverse logistics provider

Wanna chat in the cooler? Shoot me an email with comments, questions or story ideas at moconnell@freightwaves.com.

See you on the internet.

Mary

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Trucking love stories; Trump’s reciprocal tariffs; Response’s $4M seed round | WHAT THE TRUCK?!?

On Episode 804 of WHAT THE TRUCK?!?, Dooner is celebrating Valentine’s Day in the supply chain by sharing your best trucking love stories.

Trump writes a love letter to the world by slapping every country with reciprocal tariffs. What you need to know before April 1.

Response raised $4 million to simplify spend and procurement management. We’ll meet CEO and co-founder Keivan Shahida.

Before you head out on a date, you may want to know whose car you’re getting in. If you’re shipping freight, you want to know who is hauling that load. J. J. Keller’s Mark Schedler talks all about background checks and MVR reports.

Stephenson & Co. founder John Stephenson shares insights from their latest industry benchmarks.

LTL signup form – Free Introductory Session – February 18, 2025

https://stephenson-co.com/2025-ltl-industry

Truckload signup form – Free Introductory Session – February 25, 2025

https://stephenson-co.com/truckload-industry

Small Package Delivery Industry – Free Introductory Session – February 20, 2025

https://stephenson-co.com/small-package-delivery

Catch new shows live at noon EDT Mondays, Wednesdays and Fridays on FreightWaves LinkedIn, Facebook, X or YouTube, or on demand by looking up WHAT THE TRUCK?!? on your favorite podcast player and at 5 p.m. Eastern on SiriusXM’s Road Dog Trucking Channel 146.

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LSP strategy in a very different year

With tariff negotiations underway and industry trends favoring nearshoring and process shifts, logistics service providers (LSPs) must remain flexible and strategic to manage changing costs and supply chain availability.

Ann Marie Jonkman, Vice President of Global Industry Strategy at Blue Yonder, sees both challenges and opportunities ahead.

Navigating Cost and Efficiency in Logistics

Logistics companies are always seeking ways to improve labor costs and efficiency. Now, they are closely watching tariff negotiations to understand how trade policies will impact operations.

“If there’s one constant, it’s change,” Jonkman said. “But what’s truly transformative is how technology enables us to adapt quickly. Many of our LSP customers started investing in advanced supply chain solutions last year, anticipating ongoing market shifts.”

“They’re asking us, ‘How can we leverage technology to stay competitive and resilient?’” she added. “Whether it’s optimizing transportation routes or improving inventory placement, technology is our greatest asset in navigating these changes.”

A Tailored Approach to Supply Chain Strategy

Given the uncertainties ahead, Jonkman emphasized that there is no one-size-fits-all strategy.

“Every company has a unique business mix, and that shapes their approach,” she explained. “For example, if you import primarily from Canada or Mexico rather than overseas markets, the impact of tariff changes will differ significantly.”

Potential strategies include increasing North American sourcing, adjusting ocean container use, exploring alternative routes, and forming partnerships with other LSPs to expand geographical flexibility.

“You need to analyze a vast amount of data to fully understand cost implications,” Jonkman noted. “You can’t simply hope the impact will be minimal or assume business as usual. Today’s technology allows us to assess complex data sets and adjust strategies in real time.”

The Role of AI in Logistics Adaptation

With advancements in AI and machine learning, waiting weeks or months for critical data is no longer necessary.

“I started in operations, and if you’ve worked in that space, you know conditions can change instantly,” Jonkman said. “Success depends on having strategies in place that account for labor, product positioning, final-mile delivery, and manufacturing timelines—aligning all of these factors quickly is what allows businesses to pivot effectively.”

Beyond logistics, Blue Yonder serves the retail and manufacturing sectors, where tariff changes and nearshoring trends will have varied impacts.

“For some companies, making their supply chain more efficient means keeping operations within the U.S.,” Jonkman explained. “But if your products are sourced from China, Africa, or the Caribbean, tariffs will still apply. The key is optimizing domestic operations to offset those costs.”

Potential cost-saving strategies include leveraging less-than-truckload (LTL) and parcel freight, automating processes, and forming partnerships within an LSP network. However, Jonkman cautioned that no single solution guarantees success.

“You have to evaluate every component carefully,” she said. “Some costs will be passed on to consumers—but how much? It’s crucial to consider the full end-to-end supply chain rather than relying on a simplistic solution like moving everything to domestic production.”

Connecting Data for Greater Visibility

Jonkman highlighted the power of AI in guiding both client and internal operations toward better decision-making.

“Flexibility starts with visibility,” she said. “Right now, companies often rely on multiple disconnected systems to gather relevant data. I encourage transportation leaders to assess their siloed systems and explore how they can be connected.”

Key cost drivers—including shipments, detention charges, capacity, and labor—must be analyzed holistically to prevent unexpected expenses.

“You need real-time visibility into every stage of your supply chain,” Jonkman emphasized. “Without it, you’re reacting to reports at the end of the week or month rather than making proactive adjustments.”

“When you connect siloed systems and apply AI to extract insights, you can make better, faster decisions,” she added.

Even in a typical year, these factors require careful management. But with the additional complexities of 2025, Jonkman underscored the need for expert guidance.

“This year will bring a variety of disruptions,” she concluded. “Companies need the right strategic partners in their corner—because that’s exactly what our customers are asking us to help them solve.”

Click here to learn more about Blue Yonder.