Trucking industry groups react hopefully to Trump win

Trucking industry groups react hopefully to Trump win

In the wake of the 2024 presidential election, President-elect Donald Trump will return to the White House as the nation’s 45th and now 47th president. For the trucking industry, beset by looming and planned regulations from emissions controls to electric vehicle mandates to speed limiters, the incoming Republican administration presents an opportunity to shape the regulatory landscape. Compared to the outgoing Biden-Harris administration, whose focus was on stricter safety rules and carbon emissions, trucking lobbying groups see a chance to claw back some of the regulations they feel are negatively impacting the industry.

The American Trucking Associations in a statement focused on legislative priorities including replacing the Environmental Protection Agency’s electric truck rule with “national emission standards that are technologically achievable and account for the operational realities of our essential industry.” The ATA adds, “With the Tax Cuts and Jobs Act set to expire next year, ATA stands ready to work across the aisle on Capitol Hill to achieve pro-growth tax reform, including repealing the century-old, punitive federal excise tax on heavy-duty trucks and trailers that penalizes our industry for investing in newer, cleaner, and safer equipment.”

The removal of the excise tax has been a long-standing goal. David Taube and Colin Campbell of Trucking Dive write, “Trucking groups said Trump’s win bodes well for the potential repeal of a century-old federal excise tax, one of their top concerns. The tax represents a 12% sales tax on new equipment, and past legislative attempts to reform it have come up short.”

The Owner-Operator Independent Drivers Association also released a statement. President Todd Spencer said, “We look forward to working with the Trump Administration and congressional allies to advance a pro-trucker agenda, which includes expanding truck parking, stopping unworkable environmental mandates, and preventing a dangerous speed limiter mandate.” Spencer told FreightWaves that Vice President-elect JD Vance during his time as a senator has been a co-sponsor of the Truck Parking Safety Improvement Act and the DRIVE Act.

Disclosure: JD Vance is an investor in FreightWaves SONAR through the Rise of the Rest fund.

LMI October Index shows 11th consecutive month of expansion

The Logistics Managers’ Index recently released its October data, which saw the 11th consecutive expansion of the overall index – the highest level since September 2022. The overall index rose 0.3 points from September to 58.9 points, buoyed by expansion in transportation pricing, whose increase of 5.7 points from September to 64.1 was the largest rate of growth since May 2022. The LMI is a diffusion index, meaning a reading above 50 signals expansion, while a reading below 50 indicates contraction.

Compared to last month, transportation capacity was similar, up 0.8 points from September to 50.8 points for October. While the movement was slight, a more granular examination showed a larger swing between the first and second half of the month. The report notes, “Transportation Capacity actually contracted in the first half of October (45.8) before expanding again later in the month (54.3). It will be interesting to see if capacity continues to loosen in November or if it moves back towards no change.”

The report adds that it will be worth watching whether transportation capacity continues to loosen into November or if there is no change, as there is a scenario in which, if transportation prices continue to rise, “more idle capacity will come off the sidelines to take advantage of the increased opportunity, leading to the somewhat counterintuitive situation that we now find ourselves in where both Transportation Prices and Capacity are increasing.”

The report continues, “All of this suggests that the market is turning, just more slowly than carriers would prefer. The reason for this slower turn is that there is more excess capacity in the system than we would normally have.”

Market update: U.S. Bank Q3 freight index cautions slow freight market recovery

U.S. Bank recently released its Q3 Freight Payment Index, which saw continued downward pressure on shipments and spend volume. The report notes, “The declines in truck freight shipments and spend in Q3 were the smallest in the last six quarters, suggesting positive signs for truck freight, as well as indications that true market recovery will take time.” The shipments index fell 1.9% compared to Q2 and is down 21.2% compared to Q3 2023. Similarly, the spending index saw a decline of 1.4% compared to the previous quarter, down 21.3% year over year.

Part of the reason for the decline was U.S. manufacturing activity, which remained sluggish from July through September. One area of concern from Fed data was factory output contracting between 1% and 1.5% quarter over quarter. Durable goods were the other highlight, with big-ticket items usable for a minimum of three years falling 2% to 2.5% compared to Q2.

Drilling down in more detail, the report noted that falling housing starts was another headwind, U.S. Census Bureau data reported total new housing units during Q3 at 5.5% to 6% lower than Q2. For flatbed carriers, this was reflected in FreightWaves SONAR data, with flatbed outbound tender rejection rates averaging around 6.49% for Q3 from July 1 through Sept. 30. Comparatively, FOTRI averaged 14.7% during Q2, according to SONAR data. Other modes outside flatbed may also have been impacted, the report adds: “Not only does home construction help freight volumes with construction materials (for example, lumber, shingles, drywall) but also furnishings, appliances, flooring and paint.”

One bright spot in Q3, according to the report, was retail sales excluding auto dealerships, gasoline stations and restaurant sales. Retail sales rose nearly 2.5% compared to the previous quarter and were 4% higher than in Q3 2023.

FreightWaves SONAR spotlight: November brings an uptick to dry van spot rates

Summary: Dry van spot rates are on the rise. The first week of November saw an uptick in spot market rates and greater volatility in the daily average. The FreightWaves National Truckload Index 7-Day Average rose 3 cents per mile week over week from $2.26 on Oct. 28 to $2.29. Looking at the daily movements of the NTI, which feed the seven-day average, they are trending above the weekly average, suggesting further increases in the short term. One example of this is the NTID reaching its highest recorded value in the past three months on Nov. 3 at $2.45 per mile all-in.

In the contract space, dry van outbound tender rejection rates saw a slight increase in the past week but remain below their month-over-month peak of 5.31% on Oct. 10. VOTRI rose 22 basis points w/w from 4.73% on Oct. 28 to 4.95%. This is a 191-bp improvement compared to this time last year, when VOTRI was at 3.04% on Nov. 4, 2023. Dry van tender rejection rates continue to follow a similar trend to 2019, when VOTRI was at 4.79% during this time.

The impacts and results of the presidential election deserve an honorable mention. The dry van truckload sector is heavily exposed to consumer goods consumption and manufacturing trends, whose ebb and flow correlate to truckload orders. Following the results of the election, the looming question of government policy will be a topic worth watching due to its trickle-down effects on the truckload space.

The Routing Guide: Links from around the web

Court data reveals extent of truck lease program abuse (FreightWaves)

October 2024 For-Hire Trucking Index (ACT Research)

Proposed Trump tax cuts expected to be a boon for freight (FreightWaves)

As downturn continues, industry sentiment turns pessimistic (Truck Parts Service)

Expectations of strong peak season keeping truckers employed despite overcapacity concerns (Land Line)
FMCSA to extend broker financial compliance deadline (FreightWaves)

Lockout stalls more container ships outside western Canada ports

Container ships continue to line up outside Canada’s busiest import gateway as carriers wait for a lockout of union longshore employees to end.

On Monday, 700 forepersons represented by International Longshore and Warehouse Union (ILWU) Local 514 were locked out by ocean carriers and terminal operators represented by the British Columbia Maritime Employers Association (BCMEA) at the west coast ports of Vancouver and Prince Rupert, after the union rejected what the employers group said was its “final” contract offer.

The union also is objecting to the introduction of automation in port operations.

Longshore foremen supervise other longshore workers and manage loading operations in port facilities.

As of Wednesday, a total of 11 container ships, including seven at Vancouver, were waiting in the region, up from six prior to the lockout, according to supply chain data firm Everstream Analytics. That total is expected to grow as more scheduled ships arrive in the coming days.

The ports handle an estimated $800 million worth of trade a day.

In 2023, a 13-day strike at the British Columbia ports disrupted more than $4.32 billion in trade. The current dispute comes at the same time as a strike at the Port of Montreal.

If the labor dispute drags out, the effects could soon be felt in the United States.

“Any port disruptions in Vancouver would have the most significant impacts on imported goods destined for markets in the western U.S.,” said Jena Santoro, senior manager of intelligence solutions at Everstream, in comments accompanying the data. “Vancouver is a critical entry point for perishable food items like dairy, produce, and seafood, and manufactured goods like automotive components.

“Further, vessel diversions to U.S. west coast ports could cause congestion to spike and prompt cargo processing backlogs at ports like Seattle, Oakland, and even further south like Los Angeles-Long Beach. As other nearby Canadian ports are also participating [in the lockout], diversions to U.S. west coast ports are even more likely. Intermodal transport from Vancouver, namely, rail and ground freight, would also be affected as prices would likely increase amid trucker shortages and cargo delivery delays.”

Prince Rupert is an originating point for intermodal traffic moving by rail to Chicago and the U.S. Midwest.

Current data indicate that carriers are choosing to have their vessels wait at anchor instead of rerouting to U.S. West Coast ports. But no resolution to the shutdown in the coming days could see the first diversions as lines look to avoid costly delays.

Everstream said historical data shows that for every day the lockout continues, it will take three to four days to return to normal operations.

Find more articles by Stuart Chirls here.

Related coverage:

Hapag-Lloyd bets big on green newbuilds

Reports claim Houthis make Red Sea vessel attacks a $2B business

Lone container line undeterred by Red Sea attacks

US weekly rail volume jumps

This story originally appeared on Trains.com.

WASHINGTON — Weekly U.S. rail traffic showed its biggest gain in seven weeks over the period ending Nov. 2, boosted by a double-digit increase in intermodal traffic.

According to the Association of American Railroads, weekly volume was 516,743 carloads and intermodal units, a 6.6% gain over the same week in 2023. That was the largest single-week improvement since a 6.8% gain in the week ending Sept. 14. [See “Intermodal continues hot streak …,” Trains News Wire, Sept. 19.] The week’s total included 228,635 carloads, up 1.9%, and 288,108 containers and trailers, up 10.7%.

Through 44 weeks of 2024, U.S. carload volume is down 3% compared to the same period in 2023, while intermodal traffic is up 9%. Combined, that makes for a 3.2% increase in volume compared to the first 44 weeks of 2023.

North American volume for the week, as reported by nine U.S., Canadian and Mexican railroads, includes 340,572 carloads, a 1.8% increase from the corresponding week in 2023, and 371,537 intermodal units, a gain of 9.9%. The overall volume of 712,109 carloads and intermodal units represents a 5.9% gain.

Year-to-date volume for North America is up 2.4%. That includes flat volume in Canada and a 3% gain in Mexico.

RXO Q3 earnings: First look

Here are some highlights from RXO’s third-quarter earnings report:

The earnings are the first at RXO (NYSE: RXO) to reflect numbers from Coyote Logistics. However, that deal closed Sept. 16, so it is a relatively minor part of the numbers.

RXO’s operations lost money in the quarter. The operating loss was $20 million compared to operating income a year earlier of $6 million. RXO had transaction, integration, restructuring and other costs that impacted GAAP earnings by $1.86 per share. It showed up on the earnings report under “other expense” and was $216 million. The net loss of $243 million came out to $1.81 per share.

Operating revenues were higher. Truck brokerage revenues rose 10.8% to $655 million. Last-mile revenue was up 4.7% to $268 million. Managed transportation revenue, however, dropped 7.4% to $151 million.

The truck brokerage gross margin fell 140 basis points, to 13.7%. Complementary services, which includes last mile, managed transportation and freight forwarding, rose by 150 bps to 21.5%. The end result was a corporate gross margin of 17.3%, down 40 bps. RXO doesn’t expect the brokerage group to move much in the fourth quarter, foreseeing a Q4 gross margin of between 12% and 14%.

The earnings report breaks out what it called “legacy RXO” from Coyote data. For the almost 12-month period between Oct. 1, 2023, and the last day before the Coyote closing, Coyote had adjusted earnings before interest, taxes, depreciation and amortization of $66 million. During that same period, legacy RXO had adjusted EBITDA of $130 million. Coyote’s adjusted EBITDA for the two weeks it was part of RXO during the quarter was negative $2 million.

The earnings statement cited two numbers about complementary services beyond the financial figures. It said the managed transportation operationssigned on more than $300 million in new freight under management in its sales pipeline. And last-mile stops rose 11% year on year.

RXO’s earnings call was scheduled for 7 a.m. EST Thursday.

More articles by John Kingston

Forward Air names new chief commercial officer

A grey sleeper cab pulling a white Forward Air dryvan trailer

Forward Air announced a new chief commercial officer Wednesday after the market closed. Eric Brandt has joined the embattled company following its messy merger with freight forwarder Omni Logistics.

Brandt has more than 20 years of experience in transportation and logistics, most recently serving as executive vice president of business development at Ceva Logistics (North America). He has also served in other customer-facing leadership roles at Agility and Panalpina.

Brandt is tasked with leading the commercial strategy and business development efforts for the newly combined Forward-Omni entity.

“We are well-positioned to be a leader on the global logistics stage, and Eric has the experience and vision to help us get there,” Forward CEO Shawn Stewart said in a news release. “His expertise in strategic leadership and large-scale transformation initiatives will be invaluable as we continue to enhance our service offerings and deliver outstanding customer experiences.”

Stewart was the president and managing director of Ceva’s North American operations before joining Forward in April. He arrived at Forward shortly after the ouster of CEO Tom Schmitt, who was the architect behind the merger that ran afoul of shareholders as it sidestepped an approval vote.

Forward (NASDAQ: FWRD) has refreshed its leadership team in recent months as it continues to integrate the acquisition that doubled its size. It hired former YRC Worldwide, now bankrupt Yellow Corp. (OTC: Y ELLQ), CFO Jamie Pierson in May. Pierson’s expertise is in restructuring and strategic planning.

It remains to be seen how much runway the current management team has, however, as some investors have publicly called on its board to engage in a sales process. FreightWaves reported last month that the company has retained investment bankers to help lead a potential sale.

The company teased the addition of a chief commercial officer on its third-quarter call earlier this week. That was the first full quarter during which the company was cash-flow positive since the deal closed in January.

More FreightWaves articles by Todd Maiden

Top 10 trucking policies likely to be affected by Trump’s return

WASHINGTON — President-elect Donald Trump and Vice President-elect JD Vance will exert significant influence on major policies affecting trucking, with major cost implications, for example, for truck automation and electric vehicles.

While the slate of pending regulations and legislation affecting trucking is long, below is a Top 10 list, in no particular order, of some of the most significant trucking policies that the Trump-Vance administration – along with Congress – will likely be taking on over the next four years.

1. Engine emissions

Biden-Harris: Environmental Protection Agency’s Greenhouse Gas Emissions Standards for Heavy-Duty Vehicles – Phase 3 final rule applies to truck model years 2027 through 2032, relies heavily on battery-electric and hydrogen-electric power systems.

Trump-Vance: Will likely reset standards at levels it sees as technologically feasible for internal combustion engines, lengthen timelines for compliance and consider other ways to meet emissions targets, such as renewable diesel.

Cost implications: New diesel-powered electric tractors cost roughly $180,000, compared with up to $450,000 for a new electric tractor. Also, current EV batteries weigh as much as 12,000-16,000 pounds, which takes away from cargo capacity due to highway weight restrictions.

2. Speed limiters

Biden-Harris: Federal Motor Carrier Safety Administration proposed rule scheduled for January 2025.

Trump-Vance: Rule could be delayed – possibly indefinitely – as Vance has supported legislation prohibiting the use of speed-limiting devices in trucks.

Cost implications: Rule is endorsed by large carriers and their associations (American Trucking Associations, Truckload Carriers Association) to codify a technology already engaged in many large fleets. Owner-operators say the rule is unsafe and would introduce unfair competition with larger carriers.

3. Autonomous trucks

Biden-Harris: Planned to propose a regulation in December, Safe Integration of Automated Driving Systems-Equipped Commercial Motor Vehicles, addressing the highest levels (Level 4 and Level 5) of truck automation.

Trump-Vance: A return to a less regulatory, more industry-driven approach to truck automation as was the case during the first Trump administration, by encouraging more feedback from autonomous vehicle technology companies.

Cost implications: Potentially less onerous for the trucking industry because the Biden-Harris rule would have considered higher costs for training and certifying those performing enhanced inspections, as well as the potential for sidelining trucks and their drivers with additional inspections.

4. Trade/tariffs

Biden-Harris: Maintain current tariffs on certain goods from China while raising and expanding tariffs on green energy products, steel and aluminum.

Trump-Vance: Impose a 60% tariff on all U.S. imports from China and a baseline tariff on all U.S. imports of 10%-20%.

Cost implications: A net positive for domestic economic growth, which could spark a corresponding boost in trucking demand. Freight lobbying interests could also have more power in negotiating tariff exceptions.

5. Corporate taxes

Biden-Harris: A potential increase from 21 to as high as 28%.

Trump-Vance: Cutting to as low as 15% for companies that make their products in the U.S., and a potential repeal of the 12% federal excise tax (FET) on heavy trucks and trailers.

Cost implications: The more tax policy favors U.S. domestic products, the more immediate positive downstream effect on freight haulage from manufacturing plants like automobiles and household goods. Repealing the FET could provide incentives for investments in cleaner trucks.

6. Tort reform

Biden-Harris: Was in favor of labor law legislation that included expanding violations and monetary damages, similar to those found in lawsuits involving truck accidents.

Trump-Vance: May be more inclined to support legislation that would push cases involving such lawsuits into the federal court system.

Cost implications: A potential win against “nuclear verdicts” (awards in excess of $10 million) against trucking companies at the federal level and for tort reforms pushed by the trucking industry that have been gaining momentum at the state level.

7. Truck parking

Biden-Harris: Expansion of funding through the Infrastructure, Investment & Jobs Act (IIJA).

Trump-Vance: Vance was a co-sponsor of the Truck Parking Safety Improvement Act, a bill spearheaded – but yet to be enacted – by the Owner-Operator Independent Drivers Association.

Cost implications: Reintroduced legislation would dedicate $755 million in grant money over the next three years specifically for expanding truck parking.

8. Independent contractors

Biden-Harris: The Department of Labor’s final rule on independent contracting made truck drivers more likely to be seen as employees and not independent contractors in disputes with employers.

Trump-Vance: An expected return to policy put in place during Trump’s first term that the Biden administration reversed, making it easier for the DOL to find that a worker was an independent contractor rather than an employee.

Cost implications: Administrative costs saved by carriers would be the responsibility of independent contractors.

9. Oil

Biden-Harris: U.S. production of crude oil is at an all-time high – 13.5 million barrels a day – according to the Energy Information Administration.

Trump-Vance: “Drill, baby, drill.”

Cost implications: ExxonMobil CEO Darren Woods recently told CNBC that drilling activity at his company would not be impacted by who is in the White House: “I’m not sure how drill, baby, drill translates into policy.” However, what might cause oil prices to rise – and by extension, a rise in diesel costs for trucking – would be a new round of U.S. sanctions on Iran.

10. Infrastructure legislation

Biden-Harris: $1.2 trillion infrastructure bill/$110 billion for roads, bridges, major projects.

Trump-Vance: Infrastructure reauthorization for 2026.

Cost implications: Just as President Biden had significant influence on the size, scope and direction of the IIJA, President-elect Trump could exert his influence on the direction of the next infrastructure bill, including paring back environmental provisions and setting aside more money for expanding highway and bridge capacity.

Disclosure: JD Vance is an investor in FreightWaves SONAR through the Rise of the Rest fund.

Click for more FreightWaves articles by John Gallagher.

Family-owned Canadian carrier shutters operations after 76 years

A family-owned Canadian cross-border trucking company — McKevitt Trucking, headquartered in Thunder Bay, Ontario – has ceased operations after more than three-quarters of a century.

A source familiar with the situation told FreightWaves on Tuesday that former drivers for McKevitt Trucking were told about three weeks ago that the company was winding down operations by Oct. 31. The source declined to comment further.

It’s unclear why one of the largest cross-border truckload and less-than-truckload carriers in Northern Ontario shut its doors. TBNewsWatch first reported the trucking company’s closure.

FreightWaves has reached out to John McKevitt Sr., president of McKevitt Trucking, for comment.

Privately held McKevitt Trucking started as a one-truck operation in 1948 and ramped up operations to a fleet of 165 tractors and 450 trailers. It hauled general freight, household goods, building materials, refrigerated food and paper products.

At the time of its closure, McKevitt Trucking was down to 81 power units and the same number of drivers. Late Tuesday, the trucking company’s website and email were no longer working.

In addition to its headquarters in Thunder Bay, McKevitt Trucking will close its terminals in Ontario, including Sault Ste. Marie, Timmins, Sudbury, North Bay and Mississauga.

Its trucks had been inspected nine times and two had been placed out of service in a 24-month period, resulting in a 22.2% out-of-service rate. This is slightly lower than the industry’s national average of around 22.3%, according to the Federal Motor Carrier Safety Administration SAFER website.

The trucking company’s drivers were inspected 17 times and none were placed out of service. The national average for drivers is around 6.7%. In the past two years, McKevitt Trucking has been involved in two tow-aways.

According to FMCSA data, McKevitt’s Bodily Injury Property Damage coverage is slated to be canceled on Dec. 1.

Click here for more articles by Clarissa Hawes.

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Lufthansa Cargo bolsters China partnerships as trade grows

Front facade of Shanghai Pudong International Air Cargo Terminal.

The cargo subsidiary of Lufthansa Group is doubling down on activity in China to capitalize on the country’s growing dominance as an airfreight center for European trade thanks to a recent boom in e-commerce exports combined with its traditional role as manufacturer for the world.

Lufthansa Cargo on Wednesday announced that CEO Ashwin Bhat has reinforced partnerships with the Shanghai Airport Authority, Air China Cargo and China Postal Express & Logistics Co.

The cargo airline for 25 years has operated the Shanghai Pudong International Airport Cargo Terminal Co. (PACTL) in a joint venture with the Shanghai Airport Authority, a state-owned enterprise of the city that operates Pudong airport and JHJ Logistics Management Co. The facility provides warehousing, customs clearance, consolidation, and loading and unloading services for Lufthansa Cargo and other airlines. PACTL last year handled more than 1.6 million tons of cargo.

Shanghai is Lufthansa Cargo’s biggest air hub after Frankfurt, Germany.

Lufthansa Cargo operates 11 Boeing 777 long-haul cargo jets and four Airbus A321 converted freighters in regional service. An additional six aircraft are chartered from AeroLogic, a joint venture with DHL, and operated by AeroLogic on behalf of Lufthansa Cargo. Lufthansa Cargo also manages the belly cargo for Lufthansa Group’s passenger airlines besides Swiss International. It has multiple cargo routes connecting cities in China and its Frankfurt hub, including ones from Zhengzhou and Shenzhen that were established this year.

The memorandum of understanding between the Shanghai airport authority and Lufthansa Cargo calls for the parties to increase Pudong airport’s international competitiveness by further enhancing operational efficiencies, sustainability initiatives and customer service, including through the digital integration of China and German customs authorities.

Lufthansa Cargo has operated regular cargo flights for China Post Group from Shanghai to Frankfurt since 2018. China Post’s logistics arm provides domestic and international express delivery and contract logistics services. A news release didn’t provide details about how the partnership has expanded, but one possibility is Lufthansa operating more dedicated frequencies for the postal service.

Air China Cargo owns nine B777 freighters and three Boeing B747-400 freighters and handles cargo moving in the lower deck of Air China passenger aircraft.

PACTL 25th anniversary

Last month, PACTL issued a five-year strategy aimed at strengthening its competitiveness. It operates five cargo terminals, including specialized temperature-controlled and e-commerce facilities, at Shanghai’s two major airports. Since its founding 25 years ago, it has expanded services across southern China, supporting more than 70 airlines and 300 forwardings. PACTL’s trucking network spans the country.

PACTL’s focus areas include strengthening safety management and improving efficiency. The terminal said it will expand the number of supervisors on the ramp to better coordinate pallet traffic, integrate decision-making tools in its cargo management platform and expand its network of remote terminals to better serve the Yangtze River Delta region.

The ground handling company is also testing unmanned warehouse storage using AI-driven applications, accelerating upgrades at PACTL West and participating in the development of new facilities at Shanghai’s two airports.

Lufthansa Cargo saw cargo revenues increase 16% to $789 million during the third quarter. It has shifted capacity from the trans-Atlantic to the Asia-Pacific region to capitalize on strong trade flows from there to Europe and North America, especially for e-commerce shipments. And late last month it launched trans-Pacific service from Vietnam to the United States.

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

Write to Eric Kulisch at ekulisch@www.freightwaves.com.

Hapag-Lloyd bets big on green newbuilds

Liner operator Hapag-Lloyd said it has signed two orders worth $4 billion for a total of 24 container ships with two Chinese shipyards.

An order of 12 ships of 16,800 twenty-foot equivalent units each will be built at the Yangzijiang Shipbuilding Group, for capacity expansion in existing services.

The Hamburg, Germany-based carrier (XETRA: HLAG.DE) said an additional 12 vessels each with capacity of 9,200 TEUs have been ordered from New Times Shipbuilding Co. Ltd. and will replace older vessels that are approaching the end of their service life this decade.

The newbuilds will be equipped with fuel-efficient, low-emission dual-fuel liquefied gas engines that can be powered by biomethane, which can reduce carbon dioxide equivalent emissions by up to 95% compared to conventional drives. The new ships are also ammonia-ready.

Delivery is scheduled from 2027 through 2029.

The newbuilds have a total capacity of 312,000 TEUs; $3 billion in long-term financing has been committed to the $4 billion purchase price.

Hapag-Lloyd operates 287 container ships with total capacity of 2.2 million TEUs. In response to an email a company spokesman said it had not yet been decided which older ships will be removed from the fleet, but that total fleet TEU capacity will be greater once the new vessels are delivered.

“This investment is one of the largest in the company’s recent history and at the same time a significant milestone for Hapag-Lloyd and our 2030 strategy as we continue to grow while modernizing and decarbonizing our fleet,” said Rolf Habben Jansen, chief executive of Hapag-Lloyd AG, in a release. “By operating a more efficient fleet, we are also improving our competitive position and can continue to offer our customers a global, high-quality product thanks to the increase in capacity.”

By 2030 the new vessels are expected to help the carrier reduce greenhouse gas emissions from fleet operations by about a third compared to 2022, and a step toward the goal of net-zero fleet operations emissions by 2045.

Hapag-Lloyd added that emissions goals will be met through a combination of investments in modern, efficient newbuilds, slow steaming, fleet modernizations, the use of new propulsion technologies and alternative fuels.

In April, Hapag-Lloyd announced it would convert five ships to methanol propulsion.

This article was updated Nov. 6 with comments from a Hapag-Lloyd spokesman.

Find more articles by Stuart Chirls here.

Related coverage:

Reports claim Houthis make Red Sea vessel attacks a $2B business

Lone container line undeterred by Red Sea attacks

Montreal port employers pressure striking union

Election 2024: US lawmakers who support initiatives to fight freight fraud

Over the past few years, growing threats in the freight and retail sectors prompted lawmakers to propose legislation targeting freight fraud and organized retail crime.

With increased incidents of organized theft along supply chain routes and sophisticated retail crime schemes, these legislative efforts seek to secure the movement of goods and support law enforcement in tackling these crimes.

Two key bills, the Safeguarding Our Supply Chains Act and the Combating Organized Retail Crime Act of 2023 (CORCA), showcase the federal push to protect domestic supply chains from both theft and fraud.

Here’s a look at the specifics of the bills, their primary sponsors and co-sponsors, and which lawmakers will still be in office to support the initiatives in the coming legislative cycle following the 2024 elections.

Safeguarding Our Supply Chains Act

Introduced by Rep. David Valadao, R-Calif., the Safeguarding Our Supply Chains Act addresses the rise in organized theft targeting critical freight networks across the U.S.

This bill seeks to establish a Supply Chain Fraud and Theft Task Force under the joint authority of Homeland Security Investigations (HSI) and the FBI. With a proposed $100 million in funding, the task force is dedicated to coordinating law enforcement efforts at both the federal and local levels to counter organized theft and fraud along freight networks, which include rail, motor carrier and intermodal systems. The focus of this task force is emphasized by a recent CargoNet study that found a 14% increase in cargo theft events across the U.S. and Canada in Q3 2024 compared to Q3 2023.

The bill has several co-sponsors from both parties, including:

Rep. Bradley Scott Schneider, D-Ill. – reelected.
Rep. Darin LaHood, R-Ill. – reelected.
Rep. August Pfluger, R-Texas – reelected.
Rep. Jim Costa, D-Calif. – too close to call, likely to win.
Rep. Vince Fong, R-Calif. – reelected.
Rep. John Rutherford, R-Fla. – reelected.
Rep. Pete Stauber, R-Minn. – reelected.
Rep. Salud Carbajal, D-Calif. – reelected.
Rep. Robert Wittman, R-Va. – reelected.
Rep. Trent Kelly, R-Miss. – reelected.
Rep. Mark Amodei, R-Nev. – reelected.
Rep. Robert Garcia, D-Calif. – too close to call, likely to win.
Rep. Steve Cohen, D-Tenn. – reelected.
Rep. Bill Huizenga, R-Mich. – reelected.
Rep. Juan Ciscomani, R-Ariz. – too close to call, 1.7% down from Democratic opponent Kirsten Engel.

Notably, Rep. Abigail Spanberger, D-Va., chose to run for governor of Virginia, leaving her seat to be filled by Democrat Eugene Vindman. Whether Vindman will support this legislation remains to be seen.

Combating Organized Retail Crime Act of 2023

CORCA is another bipartisan bill designed to address the escalating problem of organized retail crime. Sponsored by Sen. Chuck Grassley, R-Iowa, and co-sponsored by a bipartisan coalition of senators, CORCA aims to equip federal law enforcement with resources to collaborate with local authorities to dismantle complex retail crime rings. These criminal organizations often engage in elaborate schemes involving cargo theft and e-commerce fraud.

The primary co-sponsors of CORCA were not up for reelection in this year’s race. They include:

Sen. Catherine Cortez Masto, D-Nev.
Sen. John Kennedy, R-La.
Sen. Bill Cassidy, R-La.
Sen. Lindsey Graham, R-S.C.
Sen. Thom Tillis, R-N.C.
Sen. Ted Budd, R-N.C.
Sen. Steve Daines, R-Mont.
Sen. Mark Kelly, D-Ariz.
Sen. Marco Rubio, R-Fla.
Sen. James Risch, R-Idaho
Sen. Mike Crapo, R-Idaho

Co-sponsoring Sens. Martin Heinrich, D-N.M., Amy Klobuchar, D-Minn., and Ted Cruz, R-Texas, won reelection. Sen. Jacky Rosen, D-Nev., is in a close race with Republican Sam Brown, with polls leaning towards Brown, and Sen. Jon Tester, D-Mont. lost to Republican Tim Sheehy.

The Safeguarding Our Supply Chains Act and CORCA are strong indicators of a bipartisan commitment to tackling crime affecting U.S. supply chains. With key sponsors and co-sponsors remaining in office, they are positioned to play vital roles in U.S. supply chain security initiatives.

Articles by Grace Sharkey

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