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

truck fallen over

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:

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.

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

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

Related Articles:

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’

Prologis reports record logistics lease signings in Q1

A Prologis sign in front of a NACC Disaster Services facility

Warehouse operator Prologis reported record lease signings in its logistics business during the first quarter, inking deals for 64 million square feet of space.

Prologis (NYSE: PLD) reported first-quarter consolidated revenue of $2.3 billion on Thursday before the market opened. The result was 7% higher year over year and better than a $2.12 billion consensus estimate. Core funds from operations (FFO) of $1.50 per share were 8 cents higher y/y and 1 cent ahead of expectations.

Table: Prologis’ key performance indicators

Prologis reported positive inflections in most trends across its industrial facility portfolio.

Total new leases commenced increased 3% y/y to 66.7 million square feet. Average occupancy improved 40 basis points y/y to 95.3%, which was in line with the fourth quarter.

The San Francisco-based real estate investment trust also upped its 2026 guidance.

Core FFO is now forecast to a range of $6.07 to $6.23 per share, a 1% increase at the midpoint. The guide assumes average occupancy of 95% to 95.75% (25 bps higher on the low end of the range) and development starts between $3.5 billion and $4.5 billion (a $500-million increase at both ends of the range).

Prologis will host a call at noon EDT on Thursday to discuss first-quarter results.

More FreightWaves articles by Todd Maiden:

One Big Thing will solve rail’s growth problem, says NS CEO

MINNEAPOLIS — Though he never worked in supply chain or dealt with hedge funds, German philosopher Friedrich Nietzsche still managed to originate the time-honored neologism,“What doesn’t kill me makes me stronger”.

Norfolk Southern Corp. survived the deleterious effects of the Covid pandemic, declining shipper demand, a catastrophic hazmat derailment, labor issues, a leadership scandal, and activist investors, says Chief Executive Mark George. It’s emerged as one-half of a proposed transcontinental railroad that, if approved, will be a mega-strong behemoth reshaping the U.S. rail industry.

The Atlanta-based carrier (NYSE: NSC) has seen “crisis after crisis after crisis” since George arrived from HVAC giant Carrier in 2019, “but we are for the past two years running really well,” George said in a keynote address Tuesday at the annual conference of the American Short Line and Regional Railroad Association. “I’m really proud of that; the whole industry is operating well in terms of delivering good, consistent service, and I think that’s really important.” 

Important, but not nearly enough to shake off stagnant growth over the past two decades as Class I lines failed to recapture freight from trucks.

NS total freight volume decline 11% and UP (NYSE: UNP), 15%, in that time, said George, as railroads were forced to raise prices and lower costs in a bid to shore up earnings. Those measures saw the NS union workforce shrink by a third amid weaker freight levels.

“And that’s how we’ve been able to preserve operating income and grow it where you can, when you can,” he said. Relentlessly driven by Wall Street to run fewer, longer trains, the heavily-regulated, capital-intensive railroads regularly turn in operating ratios under 60%.

Even excluding coal’s sharp decline, railroads have seen their share of commodity freight such as grain, lumber and petroleum tumble even as demand for those products is steady and the overall economy continues to grow, as shippers choose to move goods by truck. George laid that at the industry’s feet, saying shippers were forced to hedge against rail’s history of inconsistent, unreliable service. 

Conversely, George pointed out that Canada’s CN (NYSE: CNI) and CPKC (NYSE: CP) railroads have defied that shrinking trend, both transcontinental systems compared to a fragmented U.S. rail network “that is frozen in time” in 2000. That’s the year before the Surface Transportation Board adopted tougher rules for mergers. 

A network of NS and CSX (NASDAQ: CSX) in the east and UP and BNSF (NYSE: BRK-B) in the west requires handoffs when railcars cross the Mississippi River watershed. 

While the interchange process is as old as railroading, there are “very inconsistent service plans and frankly, a lack of visibility once you start having handoffs between two separate companies,” George said. Shippers are affected as dwell time at interchanges leads to variability in car supply, and difficulty in scaling customer growth beyond regional footprints — a structural industry problem, George said.

UP and NS hope to replicate the post-deregulation 1980s, George said, when mergers drove volume growth, productivity improved, rates went down, and profits grew. The period, he said, before the STB froze merger activity after operational chaos following some integrations.

One notable exception was the deal that saw CSX and NS split up Conrail. That unique merger led to seven straight years of volume growth — “although I know it caused some pain and the integration got screwed up” — but George challenged skepticism over UP’s forecast of converting 1.3 million truckloads to rail, pointing out that NS converted 1 million carloads in that stretch.

“We will get there when we do this acquisition,” he insisted, “whether it happens in three years, four years or five years as with Conrail, we will get there.”

According to George the partners expect to save 95 hours — four days — on cars moving from southern California to the southeastern states, and competitive with trucks. That’s an increase from some early reporting of the merger, when the savings was put at one to two days. 

George admitted that the partners have work to do.

“It feels like we’ve lost a little momentum, that’s one of the things I’ve heard,” he said. “We’ll need to re-file a 7000-page application, that was a setback. We’ll check the boxes and get there by the end of April.”

George said that once the STB accepts the application, he expects the evaluation process to take a year or more. 

“And let me reassure you all our goal is to make sure we don’t repeat the mistakes of the past,” he said. “Our integration will be complicated. We’re pretty confident not to mention this is end to end. It’s a lot less complicated than overlapping networks. So we’re going to do this in a very, very measured way. We’re putting a lot of thought into this.” 

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

Read more articles by Stuart Chirls here.

Related coverage:

Merged UP-NS would control half of all rail freight: BNSF CEO

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

Norfolk Southern awarded control of disputed eastern port rail line

Best month in years marks broad US rail recovery

First look: J.B. Hunt Q1 earnings

closeup of a JB Hunt dedicated tractor on a highway

J.B. Hunt Transport Services beat first-quarter expectations on Wednesday after the market closed. Cost reduction initiatives allowed the multimodal transportation provider to again achieve operating income growth significantly ahead of revenue growth.

J.B. Hunt (NASDAQ: JBHT) reported first-quarter earnings per share of $1.49, 4 cents ahead of the consensus estimate and 32 cents higher year over year.

Consolidated revenue of $3.06 billion was 5% higher y/y, outpacing analysts’ expectations for revenue of $2.95 billion. Operating income increased 16% given cost takeouts and improved productivity.

Table: J.B. Hunt’s key performance indicators

Intermodal revenue increased 2% y/y to $1.51 billion as load count was up 3% and revenue per load was down 1% (down 2% excluding fuel surcharges). J.B. Hunt reported its highest-ever first-quarter volumes and said it achieved a record volume week in March.

Even with only a modest revenue increase the unit’s operating income jumped 21% y/y in the period. The operating ratio improved 120 basis points y/y to 92.4%. Prior cost cutting and better asset utilization drove the improvement.

Dedicated revenue increased 2% y/y to $841 million. The increase was entirely driven a similar increase in revenue per truck per week as average trucks in service were flat with the prior-year quarter. An 89.6% OR was 60 bps better y/y.

Operating losses widened in the brokerage unit as 3PLs across the industry were squeezed by higher purchased transportation costs (spot rates). A $4.7 million operating loss was $2 million worse y/y and marked a 13th-straight quarterly loss.

J.B. Hunt will host a call at 5 p.m. EDT on Wednesday to discuss first-quarter results.

More FreightWaves articles by Todd Maiden:

ATBS: average truck driver earnings in 2025 held mostly stable from ‘24

With April 15 having arrived, it’s time for Todd Amen to answer the annual question posed to him by FreightWaves: what sort of numbers are truck drivers filing to the Internal Revenue Service this year?

Amen is the president of ATBS, which primarily services independent owner operators. Amen put the size of the business management company’s client base at about 20,000, and part of the services it provides is the filing of income tax returns.

ATBS’ data provides a rare insight into the finances of over the road economics year in and year out. (Previous stories about Amen’s calculation of average driver pay and shared with FreightWaves can be found here.)

The key number: $71,800 was the average income for owner operators in 2025, according to Amen. But there’s a hitch.

Amen said ATBS has changed its methodology in determining that number. A prior practice that took out some of the extremes–the lowest-paid and the highest-paid as outliers–has been changed along with a few other steps.  

So the end result is that while the average income for 2024 reported by ATBS under the old system was $64,000, the $71,800 for 2025 was basically flat to the 2024 figure if that latter number had been calculated on the same basis as the 2025 number.

But within that largely unchanged average number, there’s plenty of variability.

Amen said the 2025 figure was able to come out mostly flat to 2024 because of the surge in rates at the end of the year that has continued into 2026. Revenue per mile increased about five cents per mile year over year, he said, “and that all came in the fourth quarter.” 

Amen noted that any impact from diesel prices was flat, since the comparison of full year average fuel prices between 2024 and 2025 was largely unchanged.

Amen, in his interview with FreightWaves, said he had no firm numbers on how much better drivers did in the first quarter of 2026 relative to 2025, but his summation of what he does know was succinct: “it’s good.”

The data compiled by ATBS also revealed that total miles driven by the company’s clients was down. The average number of miles driven by Amen’s customer base was about 95,000 miles for the year, which he said declined about 4%.

Miles driven are down

That development is unusual, Amen said. In tough times, he said, drivers tend to pile up more miles to make up for weak per mile freight rates. “I just think the miles weren’t available until the very end of last year,” he said. “They weren’t there no matter how many miles I wanted to run.”’

But things were different in the first quarter, Amen noted. And he cited a reason that has been heard widely: “How much of it is the illegal driver enforcement,?” he said. “I think that’s a big part of it.”

Except for the final weeks of the year, the general consensus in the trucking market was that 2025 was disastrous. And yet the average income stayed mostly steady, according to Amen’s calculations. 

The ones who made it through, Amen said, “are crafty and smart when you know the ones who survived.”

Driving without a truck payment

A new statistic for 2025 calculated by ATBS is that 34% of the company’s clients do not have a truck payment. While a firm number had not been calculated previously by ATBS, Amen said he knows that 34% is far more than in recent years. He estimated pre-COVID, only between 15% and 20% or drivers would have had no truck payment.

“I think a lot of drivers paid off their trucks during COVID with government stimulus and when they were making great money,” Amen said. “So they’re just running when they need to and where they need to, but they can survival”

The drivers who are in that position, with no truck payment to make, are avoiding a monthly bill that Amen said averages $2,900 per month. “So if you take out that from the equation, a driver can survive and run where he needs to and put food on the table,” he said.

A big issue drivers faced last year was the rise in maintenance costs. 

Crazy maintenance

“Maintenance is crazy,” Amen said, saying those costs had risen 6.5% last year from 2024. Drivers are now spending about 14 cents per mile on maintenance when a few years ago it would have been closer to 6-7 cents, Amen said. 

“Maintenance costs have gone up a ton,” Amen said. “That’s not going to change.”

The ATBS figures also highlight the top earners. That top 10% saw their earnings peak during COVID at about $276,000 per year. That number is now down about 5%, Amen said.

Of the top earners, Amen said, “they are all super specialized, whether it’s hazmat, whether it’s government freight, all those kinds of things.”

The top third of all drivers is pulling in about $166,000, down from a COVID peak of about $188,000, Amen added.

“They’re down, but it’s not enormous,” Amen said, particularly in light of just how insanely high earnings were during COVID.

The impact from higher fuel costs

The strong outlook for 2026 built into freight rates has a new threat for independent owner operators: fuel costs.

Amen said he did not have hard data yet, but that many of his drivers are spending about an additional $350 per week on diesel.

Many of the independent carriers working for brokers are beneficiaries of a fuel surcharge levied by the broker against the shipper. But Amen said the drivers don’t necessarily see all of that. 

“The brokers can pull the wool over the owner operators’ eyes sometimes and say, hey, I know fuel costs you more,” Amen said. The brokers are getting a little bit more (through the fuel surcharge) but maybe not pass through the full rate they’re getting.” 

The result, Amen said, is that “the individual owner operator is taking longer to make up increased rates to compensate for the price of fuel.”

What is offsetting that to some degree, Amen said, is a heightened knowledge base in the driver community about how fuel markets work and how the drivers can be protected from getting hit by rising diesel costs. 

“They’re getting smarter,” Amen said. “Everybody writes about it and there’s just so much data that lets them know what to ask for.

More articles by John Kingston

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TFI subsidiary TA Dedicated acquires Triangle Warehouse

front view of a white tractor on a highway

TA Dedicated announced that it has acquired fellow Minneapolis-based company Triangle Warehouse. The deal expands TA Dedicated’s fleet and adds 900,000 square feet of warehousing and distribution space to its network.

Financial terms of the transaction were not disclosed. TA Dedicated is owned by TFI International, Inc. (NYSE: TFII).

Triangle Warehouse is located near TA Dedicated’s headquarters. It operates over 100 dock doors, including seven rail doors, providing food-grade temperature-controlled storage and distribution services. Its fleet includes over 1,000 pieces of equipment, including day cabs, dock trucks and trailers (dry vans, reefers and flatbeds), serving regional manufacturers and food producers.

“For decades, Triangle Warehouse has built a singular reputation in one of the Midwest’s largest metropolitan markets through reliability, service, and long-term customer relationships,” said TA Dedicated President Eric Anson. “By bringing their capabilities and expertise into the TA Dedicated family, our customers gain access to top tier supply chain solutions beyond transportation.”

In 2022, TFI merged Transport America (TA) and UPS Dedicated, which it acquired in 2021 as part of its acquisition of UPS Freight.

Triangle Warehouse’s service and support teams will continue providing uninterrupted service to customers.

“Joining TA Dedicated greatly expands our customers’ distribution opportunities nationally without giving up the local touch they’re used to,” said Scott Carlson, vice president at Triangle Warehouse.

TA Dedicated has 70 fleets totaling more than 1,025 tractors and 1,900 trailers. It specializes in dedicated, flatbed and heavy haul transportation. It also offers other supply chain and logistics services.

More FreightWaves articles by Todd Maiden:

Trucking capacity bets grow as major carriers expand terminal networks

Prime Inc. said Tuesday it will invest more than $160 million to build a new regional trucking hub in Spalding County, Georgia, creating over 120 full-time jobs and hiring more than 50 drivers.

The new campus, located near Griffin about 37 miles south of Atlanta, will serve as a Southeastern hub and include driver training, maintenance operations and support facilities, along with amenities designed to improve driver experience.

The company operates a fleet of more than 7,000 trucks and employs over 8,500 drivers across refrigerated, flatbed, tanker, hopper and intermodal segments.

CEO Robert Low said the location’s proximity to key customers and transportation corridors was a major factor, positioning the carrier to handle growing freight demand across the Southeast.

The facility will also incorporate sustainability initiatives, including large-scale tire recycling that currently diverts more than 1 million tires annually from landfills.

State officials framed the project as another signal of Georgia’s logistics strength, where the transportation sector supports roughly one in nine jobs statewide, according to a news release.

“Prime, Inc.’s new campus will further add to Georgia’s $107 billion transportation and logistics industry that creates and supports jobs in every corner of our state,” Gov. Brian Kemp said in a statement. 

Old Dominion adds capacity in Pacific Northwest

Meanwhile, Old Dominion Freight Line recently opened a new 65-door terminal in Pasco, Washington, replacing a smaller facility the company had operated in the region since 2011.

The 32,000-square-foot terminal, located in the Port of Pasco’s industrial park, is valued at more than $7 million and is designed to increase capacity and improve service times across southeastern Washington.

Old Dominion (Nasdaq: ODL), one of the largest less-than-truckload (LTL) carriers in the U.S., said the upgraded facility will support future customer growth and strengthen its regional network.

The Pasco expansion aligns with the company’s broader strategy of adding doors and density across its LTL footprint—critical factors in improving service levels and operating efficiency.

SONAR, a freight market analytics and data platform, suggests outbound tender volumes in Atlanta show steadier, population-driven growth, while Washington state volumes remain more volatile with sharper seasonal swings tied to agriculture and port activity —highlighting why carriers are targeting both density (Southeast) and surge capacity (Pacific Northwest) in recent terminal expansions.

Atlanta’s outbound tender volumes (OTVI.ATL) is trending gradually higher year over year, while Washington volumes (OTVI.WA) are fluctuating more significantly due to seasonal shipping patterns and port-driven freight demand. To learn more about FreightWaves SONAR, click here.

Terminal investments signal shift toward density, not just fleet growth

Prime Inc. (Spalding County, GA)

  • Investment: $160M+
  • Jobs: 120+ full-time + 50+ drivers
  • Fleet: 7,000+ trucks; 8,500+ drivers
  • Facility type: Full-service campus (training, maintenance, driver amenities)
  • Strategic focus: Southeast regional density + driver recruitment/retention

Old Dominion Freight Line (Pasco, WA)

  • Terminal size: 32,000 sq. ft.
  • Capacity: 65 dock doors
  • Investment: $7M+ (property value)
  • Replaces: Legacy terminal (operated since 2011)
  • Strategic focus: LTL network efficiency + service time improvements

FMCSA balancing the scales for fleets challenging bad Safer data

Before a shipper loads your truck, before a broker assigns you a load, before an underwriter decides whether to renew your policy or what premium to charge you, they look you up. They pull your FMCSA safety data. They see your violations. They see your crashes. They see your BASICs and your SMS percentiles and your SaferSys profile. And all of that happens before you ever speak a word or shake a hand. Your data is your first impression, and in a lot of cases it is your only impression.

That is why what FMCSA just finalized matters so much, and why it should matter to every carrier, owner-operator, and driver out there running under their own authority.

The Federal Motor Carrier Safety Administration published a major overhaul of its DataQs system in the Federal Register on April 16, 2026. DataQs, for those who are not familiar, is the online system that allows motor carriers, CMV drivers, and other interested parties to submit a Request for Data Review (RDR) when they believe the crash or inspection data that the FMCSA holds on them is incorrect or incomplete. The agency processed more than 71,000 of these requests in 2024 alone, including more than 8,300 on crash data and more than 63,500 on inspections and violations. That volume tells you two things. Many carriers are using it. Many carriers have data worth challenging.

What the new rules do, in plain terms, is build a real appeals process around something that for a long time felt more like a suggestion box. States receiving Motor Carrier Safety Assistance Program funding, which is essentially all of them, will now be required to implement a mandatory three-stage review structure for every RDR they handle. Stage one is the Initial Review. The officer or inspector who wrote the violation in the first place cannot be the only person deciding whether your challenge has merit. That alone is a meaningful change from what some carriers have historically experienced: an appeal that went right back to the same person who cited you.

Stage two is a Reconsideration Review, which must be handled by a separate, independent reviewer with appropriate subject matter expertise who had no involvement in the initial decision. Stage three is a Final Review, which escalates to a senior leader or an independent panel. Nobody who touched your case before can touch it at this stage. Once that Final Review is complete, FMCSA considers the state’s decision final, and any future requests on that matter are left to the state’s discretion.

The timelines matter too. States must open your request within 7 calendar days of submission. They have 21 days to reach a decision at the Initial Review level, 21 days at the Reconsideration level, and 45 days at the Final Review level. The 45-day window at the final stage was actually extended from the originally proposed 30 days based on feedback from enforcement agencies who noted the scheduling challenges of convening independent panels. Those are real timelines with accountability, because states that do not comply risk their MCSAP funding. FMCSA will publish state-level performance data publicly on the DataQs website once it has sufficient data to make those measures meaningful.

Now here is the part you really need to hear. Enforcement makes mistakes. That is not an indictment of officers in the field. It is just a reality of a system processing millions of inspections and hundreds of thousands of crashes every year. A violation gets entered with the wrong DOT number. A crash gets attributed to a carrier that was not at fault, or a vehicle that was not even DOT-reportable. An out-of-service order is issued to a carrier that had already completed all corrective actions before the data was finalized. These things happen. When they happen to you and you do nothing, that bad data sits in the federal system and gets pulled every time someone looks you up.

If you have violations on your record that were entered in error, do not belong to you, or for which you have documentation showing they were not valid, DataQs is how you challenge them. It does not cost you a dollar. It costs you time and effort to pull together your documentation, but that is it. No filing fees. No attorney required, though you can absolutely have help. And the potential return on that time investment is significant.

Think about what your BASIC percentiles are doing to you in the SMS system. Think about what your ISS score looks like to a port or a shipper who runs carriers through screening before allowing them on their facility. Think about what happens when an underwriter pulls your loss runs and your safety data and decides that your violation frequency in the vehicle maintenance or hours-of-service BASIC puts you in a risk tier that doubles your premium. Or worse, decides not to renew you at all. These are real consequences and they are driven directly by the data FMCSA holds on you.

The crash side of this equation deserves equal attention. If you were involved in a crash that was not DOT reportable and it is showing up in your record anyway, that needs to be challenged. If the crash was determined to be non-preventable, you should be using the Crash Preventability Determination Program in conjunction with DataQs. FMCSA has expanded the evidentiary categories available to carriers making preventability arguments, and dash camera footage is now a meaningful tool in demonstrating that you were not the responsible party. If you have video showing what actually happened, use it. Submit it. Make them look at it.

There is also an angle here that is not discussed enough: identity theft. Carrier identity fraud is not a hypothetical. It happens. Someone runs under your name, your DOT number, your operating authority, and when they get inspected or they get in a crash, that data can end up attached to your record. If you are not regularly monitoring your SaferSys profile and your DataQs history, you may not even know it is happening until an insurance agent calls to tell you they cannot renew your policy.

The new implementation timeline requires states to submit their DataQs implementation plans to the FMCSA within 60 days of publication of the notice. Plans are finalized within 120 days. The new requirements take effect at 150 days, which puts full implementation around mid-September 2026. FMCSA is launching training and outreach with states starting in April and May of this year.

The burden of proof under these new rules still rests entirely with you as the requestor. FMCSA was clear about that, and the enforcement community echoed it in the comment process. You have to come with documentation. You have to explain specifically why the data is wrong or why the crash was not preventable. A general disagreement is not a valid appeal. But if you have the facts and the documentation on your side, this new system gives you a more meaningful path to getting heard than the one that existed before.

If you are not regularly monitoring your FMCSA safety data, start now. Go to safer.fmcsa.dot.gov and pull your profile. Look at your violations. Look at your crashes. Look at what is actually on your record versus what you believe should be there. And if you find something that should not be there, go to dataqs.fmcsa.dot.gov and start the process. While there are consultants who can help you, you do not need a consultant to do it. You need your documentation, some patience, and the understanding that your record is your reputation in this industry and it is worth defending.

Commentary: FedEx and UPS need to move up the e-commerce food chain

Artist rendition of the e-commerce order-to-delivery process.

By Satish Jindel

The Big Three legacy parcel carriers — FedEx, UPS and the U.S. Postal Service — are under pressure like never before as their largest retail customers build out residential delivery networks of their own in response to the massive shift in shopping from stores to digital channels. FedEx and UPS will be left behind unless they transform their core competency from being parcel carriers to e-commerce enablers.

The parcel shipping industry has dramatically changed since 1985, when 90% of parcel shipments were between businesses. Today, B2C shipments account for 70% of the parcel market. 

FedEx (NYSE: FDX) and UPS (NYSE: UPS) are profitable, so why change the business model? Positioning themselves as parcel delivery companies in this new era of e-commerce is leading them to invest in options aimed at lowering the cost of last-mile delivery. That results in them operating at the bottom of the food chain.

To be sure, the two integrators have made shipment quality a priority, rejecting light, low-priced last-mile delivery business from Chinese e-commerce sellers and Amazon (NASDAQ: AMZN) in favor of multizone, heavyweight and high-value packages that can support higher rates. 

To achieve lower cost of last mile delivery, UPS acquired same-day delivery platform Roadie for $586 million in 2021. And last February, FedEx announced it is investing $3.4 billion in InPost, a European courier with a large parcel locker network in Europe.

Instead, FedEx and UPS should invest in e-commerce platforms like Etsy (NYSE: ETSY) and others, where they would sit at the top of the food chain and be able to influence all aspects of fulfillment and delivery for online orders while helping millions of e-tailers better compete with sellers using Amazon’s marketplace.

An optimized shipping experience will create a virtuous flywheel that will generate additional orders from satisfied consumers, driving more parcel business with higher delivery density to FedEx and UPS.

Amazon has long taken a broad view of its core competency. First, it invested in Fulfillment by Amazon to help e-tailers on its online platform with fulfillment and delivery. FBA has generated great returns as about 60% of Amazon online sales and parcel deliveries come from merchants supported by FBA, enabling Amazon to build its own delivery network.

It extended that thinking even to its suppliers when it contracted with Air Transport Services Group in 2016 to operate Boeing 767 freighter aircraft for its logistics network. It secured warrants to purchase a minority stake in ATSG, which generated a great return when ATSG was acquired last year for $3.1 billion by private equity fund Stonepeak. 

If FedEx had such a broad view before, and had invested just $1 billion in Shopify a decade ago, instead of $4.8 billion in Europe’s TNT Express, that investment would be worth $50 billion today. Besides the great return on investment, FedEx would have become the primary delivery partner, instead of the U.S. Postal Service, for millions of small e-tailers selling products using Shopify.

While too late to invest in Shopify (NASDAQ: SHOP) given its market cap is about two times its own, it is not too late for FedEx or UPS to make a friendly investment in Etsy, or another e-commerce marketplace, or engage one of them in a strategic partnership. 

 FedEx, for example, could leverage its Dataworks capabilities to help millions of small merchants manage fulfillment and delivery. Instead of someone receiving five packages on five different days, only to accumulate on the porch and be susceptible to rain and thieves, FedEx could offer affiliated merchants a better value proposition than available for those on Amazon’s marketplace.

An e-commerce partnership would also reduce diversion of more parcels to Amazon Logistics, which last year delivered more parcels than any of the Big Three carriers. And it would help FedEx and UPS attract small-and-medium shippers faster than with their current approach.

FedEx and UPS have made many acquisitions over several decades, but only the FedEx purchase of ground-delivery specialist RPS as part of Caliber System and Viking Freight in the less-than-truckload sector, were game changers. 

RPS became FedEx Ground and by 2012 it had $1.8 billion of operating income compared to $1.2 billion for FedEx Express despite one-third the revenue — demonstrating the superior operating model of RPS for B2B parcel delivery. FedEx Ground is the primary foundation for the consolidation of Express and Ground networks now underway. 

Meanwhile, FedEx shareholders stand to make lots of money with the spin-off of LTL division FedEx Freight into a separate company on June 1, 2026.

At a reunion of RPSers on March 11, 2023, former FedEx CFO Alan Graf commented on the significance of the RPS deal: “I can’t imagine what FedEx would be today without RPS’s unique low-cost operating model. . . In 1997, I was very certain that RPS would be a game changing acquisition. It has proven to be the best acquisition in the history of FedEx.”

So, instead of limiting e-commerce delivery only to B2C shipments priced to offset their higher operating cost, FedEx and UPS need to find ways to align with companies that influence consumers buying behavior and then support them with better delivery and customer experience to ensure that the B2C market is not controlled by just Amazon and Walmart (NASDAQ: WMT).

(The views expressed here are solely those of the author and do not necessarily represent the views of FreightWaves or its affiliates.)

(Satish Jindel is founder and president of ShipMatrix, Inc. He was a key founding member of RPS and led its growth from 1985 to 1992, then advised FedEx on its acquisition of RPS and Viking Freight in 1997. Alan Graf’s full remarks can be viewed at https://jindel.com/rps-reunion/)

Mudflap acquires AI capacity platform Parade

Parade podium and large screens displaying the company’s AI capacity management platform at “The Future of Supply Chain” conference stage

Mudflap has completed its acquisition of Parade. The deal pairs Mudflap’s location-verified carrier network with Parade’s capacity management platform for brokers, which has facilitated more than $40 billion in total cumulative freight transactions.

Mudflap boasts more than 515,000 drivers across over 100,000 verified carriers. The Palo Alto-based fintech company provides fuel discount solutions to carriers via a location-aware mobile app and fuel card. Mudflap was founded in 2019 by Sanjay Desai and Sharon Yapp. Desai was the former chief product officer at Trucker Path.

Parade was founded in San Francisco in 2015 by Anthony Sutardja, Tony Wu and Preet Sivia. Parade provides brokerages with a capacity management and carrier relationship platform that integrates with existing TMS platforms. Parade’s last major funding round was a $17 million Series B in 2023 led by I Squared Capital and Menlo Ventures.

At a time when finding reliable capacity is increasingly becoming a challenge, Mudflap will enable Parade brokers to access one of the largest networks of verified carriers in the industry. 

3PL marketing spend efficiency diverged dramatically in Q4: LeadCoverage

As the freight cycle shows signs of heating up, third-party logistics (3PL) providers and freight brokers face a critical window to capture new customers. Yet a new benchmark from LeadCoverage warns that not all marketing dollars are created equal. The company’s Supply Chain Growth Index (SCGI) for Q4 2025 shows a sharply widening performance gap in how effectively logistics firms turn go-to-market (GTM) spending into qualified pipeline.

The SCGI, a quarterly benchmark of GTM efficiency and pipeline impact in supply chain and logistics, is built on anonymized data from roughly 30 LeadCoverage clients. Its core metric, the Logistics Growth Efficiency Ratio (LGER), measures pipeline created (sales-accepted leads and opportunities) divided by total GTM spend. Unlike traditional metrics that focus on closed deals, LGER isolates what the marketing and sales engine itself can control.

In Q4 2025, the median LGER fell to just $4.84 in pipeline per dollar of GTM spend, down sharply from prior quarters. The mean held at $25.74, but the range exploded to $0.36–$204.30. Six companies exceeded $20 LGER, with top performers reaching approximately $200 in pipeline per dollar spent. Those elite programs drove a disproportionate share of total pipeline impact across the dataset.

In other words, among 3PLs, marketing performance bifurcated dramatically. Low performers (bottom 25 percent with an LGER below $8) generated far less pipeline per dollar, often relying on legacy outbound dialing, minimal account-based marketing (ABM), and little paid media. Mid-range companies (middle 50 percent) hovered between $8 and $55 but risk sliding into the bottom quartile if they stand still. High performers (top 25 percent, above $55) dramatically widened the gap through data-forward strategies.

LeadCoverage CEO Kara Brown, whose firm provides end-to-end GTM services to freight and logistics companies, said the divergence reflects deliberate investment choices. 

“We believe there are three strategies that work in freight, and if you’re following them, are you able to beat the market?” Brown told FreightWaves. “As we study our clients who are beating the market, we’re going to learn over time what makes a great GTM strategy that gives a logistics service provider an actual edge.”

LeadCoverage itself operates the full GTM engine for its clients. The 40-person team handles revenue operations, CRM and marketing automation, email campaigns, content, initial lead qualification and dialing, and heavy investment in paid media, programmatic advertising, and ABM. The company also helped shape Gartner’s Redwood 4PL Magic Quadrant and positions itself at the cutting edge of AI applications in freight marketing.

Brown modeled the SCGI after Greg Crabtree’s “Simple Numbers” small-business benchmarks. With only 30-ish clients in supply chain and logistics, LeadCoverage anonymized their data to answer freight-specific questions: Is a 20 percent open rate good? Is $7 per click acceptable? More importantly, how much pipeline should a dollar of combined marketing and sales spend (minus headcount costs) realistically generate?

The market backdrop makes these questions urgent. Freight activity in 2025 never followed a classic recovery. Imports surged to $419 billion in March as shippers front-loaded ahead of tariff changes, but manufacturing remained in contraction with an ISM PMI of 49.1. Export orders were weaker still. Operating costs hit record levels at $2.26 per mile, compressing margins. Activity levels, the report notes, became a “poor proxy for underlying market health.”

In this environment, Brown explained, efficient GTM spending separates winners from the rest. “The ones who are crushing it are pulling away from the pack,” she said. “I would like to believe this is a result of really good GTM strategy and investing in AI and what’s coming.”

High performers share common traits: strong adoption of intent data, sustained ABM execution, programmatic and paid media investment, and tight sales-marketing alignment. Intent data comes in multiple forms. Primary intent lives inside a company’s own CRM (typically HubSpot), flagging when a decision-maker visits the website; top clients act within minutes. Secondary and broader signals scan the internet for shipper “pain before the pain”, when they’re searching for services that match a 3PL’s offerings. Providers such as CarrierSource and Bombora supply these signals, though Brown noted AI tools like Claude, Clay, and ChatGPT are democratizing access. The real differentiator, she said, is execution: “How you use those intent signals to target the human that should be your customer is probably the biggest gap we see.”

As freight volumes potentially rebound and shippers seek new partners, 3PLs investing in modern GTM tools can generate scalable, measurable pipeline without simply “banging the phones.” Underperformers risk wasting spend on transient demand or outdated tactics.

LeadCoverage plans to release its third index in the coming months, with early indications that market tightening in Q1 and Q2 2026 may further reward precision GTM. Brown expects the spread between leaders and laggards to continue widening.

For freight executives, the SCGI offers a new operating baseline. The median $4.84 LGER is today’s midpoint, but top performers operate four to ten times above it. 2026 is shaping up to be a year when 3PLs have the best opportunity to add new customers they’ve had since COVID. LeadCoverage’s report suggests that smart marketing spend, powered by AI, intent data, and disciplined execution, will increasingly determine who wins market share and who simply watches from the sidelines.