Freight for Thought: Estes and Old Dominion bid for YRC assets
The following insights are provided by Sunset’s Strategic Account Management team.
Trends and discussions range from seasonal manufacturing and agriculture trends that affect available capacity to general insight into outside factors affecting freight volumes.
Below is a summary of the August 2023 industry insights:
- The Teamsters voted by an overwhelming 86.3% to ratify the new collective bargaining agreement and will continue their partnership with UPS. The agreement passed by the highest vote for a contract in the history of the union.
- United Auto Workers members granted union leaders authorization to call strikes during contract negotiations with General Motors, Ford Motor, and Stellantis, if deemed necessary. An overwhelming 97% of UAW members approved the action.
- Following Yellow/YRC filing for bankruptcy on July 30, analysts expect LTL rates to rise 5% to 15% (averaging 7%) depending on the shipper’s previous coverage.
- Estes and Old Dominion both placed offers to acquire YRC/Yellow’s equipment and warehousing space after they declared bankruptcy in July. Any acquisition of Yellow’s equipment will affect nationwide capacity and pricing. If there are any changes in offerings for your business, your Sunset representative will be in touch.
- Based on current inventory levels across the country, analysts expect effective post-pandemic right sizing to be established by Q2 2024, allowing typical demand to return to the market.
- U.S. imports from Asia increased for the fifth consecutive month in July to 1.46 million TEUs — the highest since September 2022. July’s imports were up more than 35% from the 2023 low of 1.08 million TEUs recorded in February.
- In M&A news this week, CEVA has acquired Stellar Value Chain Solutions based in Mumbai, improving upon their service on routes from India. This move adds 7.7M square feet of space in more than 70 facilities across the country.
- OPEC began production cuts in July, decreasing global supply by nearly 4%.
- Diesel prices have surpassed $4.47/gallon this week, up $.086 from the week prior.
- We’ve seen a $.72 increase since OPEC began cuts in July.
KEY LOGISTICS INDICATORS
EMERGENCY WEATHER ALERTS
Please expect delays in transit for shipments going through the below listed affected areas
- Hurricane Idalia is approaching Florida and is expected to make landfall on Wednesday. For the safety of employees, facilities and customer freight, the following locations in Florida are altering their operations tonight:
- NTH – Monticello – closed, FAC closed
- NOF – Orlando – no linehaul, FAC is limited
- NTP – Tampa – closed
- NJV – Jacksonville – limited night linehaul
- In addition to the locations listed above, expect delays for freight originating in, destined for or traveling through these Florida locations throughout the duration of the storm:
- NMF – Miami
- NWF – West Palm Beach
- NFM – Ft Myers
- NPB – Pompano Beach
- There is expanded flooding in areas of West Virginia and Maryland, and in the northern part of Virginia due to thunderstorms.
- Excessive heat warnings are in effect for areas of Southern California and western Arizona.
- Water levels in the Panama Canal are now close to the minimum allowed for cargo ships to pass safely due to excessive drought. Traffic is currently limited to 32 ships daily and waiting vessels tally 160+.
Image source: https://www.fireweatheravalanche.org/fire/current-list-of-us-wildfires
Industry data is pulled and summarized weekly from key proprietors and industry experts using multiple publications and sources. Sources include, but not limited to: FreightWaves, U.S. Energy Information Administration (EIA), DAT, Journal of Commerce (JOC), Reuters, PYMNTS, NRF, Bloomberg. The information is discussed with Sunset Directors and validated prior to publication of summary data in this posting.