Truckers sound the alarm...

[kadee79]

Might want to think about this when getting ready to buy/sell or hold....

This year has been rocky for the $800 billion trucking industry.

After a raucous 2018, 2019 has seen retailers and manufacturers moving less, according to the Cass Freight Index. Freight rates have dipped year over year for six months straight. Loads on the spot market, in which retailers and manufacturers buy trucking capacity as they need it rather than through a contract, have fallen by a chilling 62.6% in May year over year.

And that means rates have dipped for independent truckers as well as major companies. Rates for van loads sank 20% in May year over year, according to DAT.

The earnings of big and small players alike are getting hit as factory activity continues to decline. The Lexington, Ky., owner-operator Chad Boblett said some truck drivers are seeing a "bloodbath."

www.msn.com/en-us/money/companies/truckers-sound-the-alarm-as-shipping-companies-hit-the-skids/ar-AAD4tQq?li=BBnb7Kz

[ModE98]

Wonder if this could be an early warning sign for economic trouble and a big stock market correction sometime later this year?  Just a thought.

[countrygirl2]

Why wouldn't they be shipping less?  Look at all the retail stores that  have closed.  And every store I go in the selections are way down.  I expect it.  Also 2 months in a row with way less jobs generated.  A recession or depression will hit, just when.  the policies of trump are  just to erratic, he nor anyone else knows what they are doing.

[Deleted]

Back in January I had posted that I was seeing companies bring a lot of demand in the last part of Q4 2018 to beat tariffs, I would speculate now part of the transportation has slowed down due to companies bringing their inventory levels back down.  I realize other tariff action is still on the table.

The major thing I am noticing now is that a lot of stuff was moved to Vietnam plants from China to avoid tariffs and Vietnam is having a hell of a labor issue and the output is nowhere near what it was at the Chinese factories.  

All anecdotal so not stating this stuff as a political point, just wondering if others see the same thing if they deal with these countries in their employment.

[kadee79]

Well, a lot of both trucking companies & independent truckers are going under due to the new tax laws....sooooo much they can no longer write off....thanks to DT & Paul Ryan.

[countrygirl2]

I didn't realize those had changed, not good.

[Value Buy]

Jun 20, 2019 17:08:03 GMT -5 kadee79 said:

Well, a lot of both trucking companies & independent truckers are going under due to the new tax laws....sooooo much they can no longer write off....thanks to DT & Paul Ryan.

What is it the truckers can no longer deduct?

[kadee79]

Jun 23, 2019 15:56:51 GMT -5 Value Buy said:

Jun 20, 2019 17:08:03 GMT -5 kadee79 said:

Well, a lot of both trucking companies & independent truckers are going under due to the new tax laws....sooooo much they can no longer write off....thanks to DT & Paul Ryan.

What is it the truckers can no longer deduct?

I don't remember the exact things...I just know that some of the independent guys said that was it, they are out of cause they would be losing money.  So likely another reason there is a truck driver shortage now too.
There will be fewer crops to move this fall with all the flooding in the Midwest too...another obstacle for some truckers.
 

ETA...this looks like it might cover what they can't deduct now....

blog.drivekandj.com/per-diem-deductions-changed-trucker-taxes

[Value Buy]

Jun 24, 2019 16:20:40 GMT -5 kadee79 said:

Jun 23, 2019 15:56:51 GMT -5 Value Buy said:

What is it the truckers can no longer deduct?

I don't remember the exact things...I just know that some of the independent guys said that was it, they are out of cause they would be losing money.  So likely another reason there is a truck driver shortage now too.
There will be fewer crops to move this fall with all the flooding in the Midwest too...another obstacle for some truckers.
 

ETA...this looks like it might cover what they can't deduct now....

blog.drivekandj.com/per-diem-deductions-changed-trucker-taxes

Article was from January 2018 and says good news for independent owner operators. No changes for them. Employees of trucking corporations would lose some deductions which might affect some drivers paying higher taxes due to lack of deductions for miles reported to dr9ve to their workplace to work.
Not earth shattering and not putting them out of business.

[Wisconsin Beth]

I was chatting recently with a couple I know at a kid thing - the dad, owner of a small family business, is shutting down the company.  They can't get enough of their product shipped.  He was saying that it was impossible to get the semis at the Canadian border to do pickup of product -  about 20% in 2018.  It sounds like he's moving to consulting with another window company and setting up a completely different job/business.  This one is the "love what you do" job for him as opposed to the family business of window installation.  The mom is disabled military so they don't have to worry about health insurance.  I'm fairly certain the mom plugged her nose and voted for trump, not sure about the dad.  He's a lot quieter and doesn't talk a whole lot with me, usually. 

[kadee79]

Jun 25, 2019 6:10:47 GMT -5 Value Buy said:

Jun 24, 2019 16:20:40 GMT -5 kadee79 said:

I don't remember the exact things...I just know that some of the independent guys said that was it, they are out of cause they would be losing money.  So likely another reason there is a truck driver shortage now too.
There will be fewer crops to move this fall with all the flooding in the Midwest too...another obstacle for some truckers.
 

ETA...this looks like it might cover what they can't deduct now....

blog.drivekandj.com/per-diem-deductions-changed-trucker-taxes

Article was from January 2018 and says good news for independent owner operators. No changes for them. Employees of trucking corporations would lose some deductions which might affect some drivers paying higher taxes due to lack of deductions for miles reported to dr9ve to their workplace to work.
Not earth shattering and not putting them out of business.

That was a quick 2 min. search...you need to look better than I did....I don't have time now either...time to fix supper.

[countrygirl2]

Has to do with changes in per diem pay, effects owners and drivers.  To many scenarios to spell out. Need to read the articles if interested.

[OldCoyote]

www.cbsnews.com/news/fedex-earnings-call-fedex-warns-of-economic-slowdown-posts-2-billion-loss/

I find that hard to believe, Two packages in two weeks,  97# next day air,,

$793 each for shipping!!

[kadee79]

Here is more on trucking.....

While the economy has mostly posted numbers that indicate health, truckers like Christopher Powell have seen their pay hit the skids.

Powell's gross earnings have tanked from $6,000 to $7,000 per week to $3,500 to $5,000 — and that's before he has to pay out for repairs, maintenance, and other business expenses. "I don't know how long I can stay in business if things don't pick up," Powell told Business Insider.

That negativity was reflected in a new Morgan Stanley freight note to investors. According to Morgan Stanley's regular freight survey, rate expectations are sinking into the negatives — "well below 2016 levels." That was the last time freight sank into a recession.

www.businessinsider.com/trucking-recession-fears-morgan-stanley-2019-7

If truckers go under, who is going to move a lot of goods to places those goods are needed?  Things may get really tight soon....glad I have a big pantry & 2 freezers besides my fridge freezer.  Looks like I'll be stocking up on some things.

[countrygirl2]

Yeah, now half the big stores are closed in the city.  We order more and more from amazon and now they are stopping shipping with fed ex I believe it is.  I figure it will take longer to get things and cost more.

There are a lot I can't buy locally anymore at our Walmart.  One day I wanted a bucket of all things, they had no buckets for sale.  I had to go to the city to get one.  So I guess they are selling less there too. If this is happening all over then I can really see china hurting by not making as much.  You know all these retailers shutting down has to effect trucking.

[kadee79]

Sources reached out to FreightWaves on the afternoon of July 11 to report that less-than-truckload (LTL) carrier LME has suddenly and abruptly shut its doors, notifying shippers they were ceasing operations.

LME is a regional LTL carrier, based in Minnesota, that operates throughout the Midwest. According to the company’s website, LME has terminals in 30 locations across the U.S. and through interline agreements services all of North America. The site also lists some of the carrier’s major accounts, including 3M, John Deere, Osram Sylvania, Brake Parts and Toro.

The company claimed that the team included “over 600 men and women.” Saferwatch lists the company having 382 power units and 1,228 trailers, with 424 truck drivers.



LME has been caught up in litigation with the National Labor Relations Board (NLRB) over disputes related to Lakeville Motor Express, which also abruptly shut down right before Thanksgiving in 2016. According to the Minnesota newspaper, StarTribune, LME was described by the NLRB as an “the alter-ego” of Lakeville Motor Express.

www.freightwaves.com/news/breaking-news-400-truck-ltl-carrier-suddenly-shuts-down

[kadee79]

And here goes another one....

The trucking apocalypse is upon us and it has taken its latest victim. This time, it’s a 40-year-old carrier out of California. Timmerman Starlite Trucking, Inc. of Ceres, California announced that it would be shutting down, placing 30 employees into the unemployment line effective immediately. Ceres is a suburb of Modesto, California, a mid-sized city 100 miles east of San Francisco. Starlite had a fleet of 30 trucks, 150 trailers and 28 drivers, according to Federal Motor Carrier Safety Administration data.

Owner Colby Bell cited a tough freight market and environmental regulations as the primary factors in the company’s failure, according to the Ceres Courier, which broke the story. Starlite also announced its closure on its Facebook page.

“We tried to provide a healthy work environment for our employees and give them the best wages and benefits we could,” Bell said. “But in the end, the rates that were available did not support the cost structure needed to compensate our employees appropriately.”

The company served clients through an 11-state region, spanning from the Rocky Mountains to the Pacific coast.

www.freightwaves.com/news/trucking-apocalypse-continues-california-truckload-carrier-latest-victim-regulations-blamed

[busymom]

There are a few products that are frequently out of stock in our new community.  At first, I chalked it up to it being smaller than the one we moved out of, and hence, not a "priority" of some of the big corporations, like, for example, Pepsi.  But now, I'm starting to wonder if it's a transportation issue.


I'd play "fill the pantry", but the house we moved into is smaller than our previous house.  

[countrygirl2]

All the retail stores closing down can't be helping.  I mean places like Sears, Toys R Us, Macys, had to ship tons upon tons of goods. Then the tariffs likely are not helping.  They likely fear stocking up on higher priced goods, afraid they won't sell.

And of course Amazon, is making inroads, but they ship.


I notice locally at our Walmart there are things you can't find, I  heard the pharmacy staff talking and they are cutting hours.  People are working but here I'm not sure if they are making more money or just working part time jobs.


I have also heard that auto sales have slowed.  It was bound to happen sooner or later, but trumps policies certainly aren't helping things.


I do stock up and likely will more.  


Also read the flooding on the Miss, has effected shipping of 50% of farm crops, but then nowhere to sell them, now how did that happen??

[kadee79]

Some farm crop contracts are sold ahead of time, so they may be filling those contracts until the next crop comes...if it comes due to all the Midwest flooding this spring.  


We have not had a decent tomato at our grocery stores for over a week now.  We have no farmer's markets where home grown are sold, only commercially grown things...mostly bought at the big wholesale market in Atlanta.

[Tiny]

Well, here's something to go along with the Trucker's issues: 

www.msn.com/en-us/money/topstocks/the-ceo-of-railroad-giant-csx-says-hes-baffled-by-the-us-economy/ar-AAEtdTH


Looks like train volume has dropped as well.... (which means there is less stuff for trucks to carry/deliver....)   And if there's less stuff for trains to move around I suspect that means there is less demand for stuff at stores  and manufacturers...   Or maybe the stuff is being delivered by Amazon Drivers and Drones?   Perhaps Amazon warehouses are now digitally printing the stuff they are selling? 

CSX pinned its revenue drop on lower volume, which offset pricing gains across most of its market. It said it expects sales to continue to fall this year.

ADDED:  I, too, am baffled by the "booming economy" -  less stuff (raw materials/finished materials) are being shipped but the economy is booming.  The economy is booming, yet business seems to be excited about dropping interest rates and pushing for the rate drop (even though rates  and inflation are historically low ).    And that low inflation -- unemployment is at a historic low... people should be flush with money and spending it on consumer crap.... which would push up inflation.....   but inflation isn't going up.    (Maybe because no one is buying "stuff" with all their hard earned money? How is that good for a consumer economy??) 
It's weird out there... 

[busymom]

It IS possible that the statistics they're putting out on how well the economy is doing is a complete load of b*ll.  I believe more what I'm seeing in my community, rather than posted numbers on the national news.  

[ModE98]

Agree something is odd about recent economics.  2&2 does not seem to add up to 4 anymore.  Hard to figure.  Just how solid are things these days?

[kadee79]

One thing I have not seen in my area this year which is also odd....no veggie crops that need Hispanics for picking....none!

There have been fields of sweet corn & there are lots of fields of peanuts & cotton...but I haven't seen any cabbage which is normally a main stay around here.

[kadee79]

Bet this guy won't overload again....costly!

A historic bridge in North Dakota, built in 1906, collapsed Monday after a tractor-trailer hauling beans and exceeding the weight limit drove over it, the Grand Forks County Sheriff's Office said in a statement.


The bridge, which is on the National Registrar of Historic Places, spans the Goose River and is rated for 14 tons of gross weight, which is marked on the structure, according to the sherrif's office. The weight of the big rig was just over 43 tons, or 86,750 pounds, the sheriff's office said.

Officials estimate it will cost between $800,000 and $1 million to replace the bridge.

The driver of the 2005 Peterbilt truck was identified as Michael Dodds, and he was not injured. An overload citation of $11,400 was issued, the sheriff's office said in a statement.

www.msn.com/en-us/news/us/too-heavy-big-rig-collapses-100-year-old-bridge/ar-AAEJmfC?li=BBnbfcL

Picture at the link.

[busymom]

Dumba$$!  Who drives a fully loaded semi over an old wooden bridge?  They ought to make his company pay to replace that bridge, not just a fine.



My home state has those wooden bridges here and there.  Locals have enough sense on how to drive on them.  Rule #1:  a lot of those bridges are arched, so you drive S-L-O-W-L-Y across them.

[Value Buy]

Jul 18, 2019 10:56:00 GMT -5 Tiny said:

Well, here's something to go along with the Trucker's issues: 

www.msn.com/en-us/money/topstocks/the-ceo-of-railroad-giant-csx-says-hes-baffled-by-the-us-economy/ar-AAEtdTH


Looks like train volume has dropped as well.... (which means there is less stuff for trucks to carry/deliver....)   And if there's less stuff for trains to move around I suspect that means there is less demand for stuff at stores  and manufacturers...   Or maybe the stuff is being delivered by Amazon Drivers and Drones?   Perhaps Amazon warehouses are now digitally printing the stuff they are selling? 

CSX pinned its revenue drop on lower volume, which offset pricing gains across most of its market. It said it expects sales to continue to fall this year.

ADDED:  I, too, am baffled by the "booming economy" -  less stuff (raw materials/finished materials) are being shipped but the economy is booming.  The economy is booming, yet business seems to be excited about dropping interest rates and pushing for the rate drop (even though rates  and inflation are historically low ).    And that low inflation -- unemployment is at a historic low... people should be flush with money and spending it on consumer crap.... which would push up inflation.....   but inflation isn't going up.    (Maybe because no one is buying "stuff" with all their hard earned money? How is that good for a consumer economy??) 
It's weird out there... 

CSX might have been bad, but Canadian Pacific reported good numbers and Kansas city Southern beat estimates, as well as another trucking company, so things are not gloomy

[Value Buy]

Jul 18, 2019 11:04:49 GMT -5 busymom said:

It IS possible that the statistics they're putting out on how well the economy is doing is a complete load of b*ll.  I believe more what I'm seeing in my community, rather than posted numbers on the national news.  

Do you believe the numbers being put up by big business in their current ending qtr. or are they lies?
Many more companies beating estimates on profit as well as sales.
Look at Coca Cola this morning, Microsoft last week.  IBM and just about any restaurant chain......
Economy is strong whether it is in your area or not.
Drove home from Midway airport last night on 294, then 94 through northern Indiana towards Michigan or south through Indiana then south on I 65. Four lanes. Three solid with semi traffic for miles and miles in both directions.
Trucks are moving something.
The railroad trains crossing northwest Indiana are longer in length this year.  Since tracks do not go over Lake michigan, these railways go along the south end of Lake Michigan towards Chicago. We witness the movement of product daily and all night.
Those carriers are not moving empty trailers and flatbeds in both directions.
The lake ports on southern Lake Michigan are still loading and unloading full loads of steel, cement, construction equipment, iron ore, wind turbine blades and agricultural products both ways.

[kadee79]

Yep, all those truckers are so busy that some going out of business doesn't amount to anything...BUT....

Here's another early warning signal of possible recession: Fewer goods are being shipped across the country.

Truck, rail and air freight volumes fell 5.3% in June from the same period a year ago, the seventh straight annual decline, according to the closely watched Cass Freight Index. That followed a 6% drop in May.

The persistent drops could portend trouble for the economy because shipments reflect demand for a wide range of consumer and industrial goods.

“There is growing evidence from freight flows that the economy is beginning to contract,” Donald Broughton, managing partner of Broughton Capital and author of the Cass report, wrote in the latest edition last week.

www.usatoday.com/story/money/2019/07/25/recession-drop-in-shipping-raises-downturn-concerns/1809574001/

And there is a nice little graph at the link.

[kadee79]

Another one with not so good news...

The industry that moves 72% of America's goods is suffering through a downturn so epic that some truckers are calling it a bloodbath.

There have been some signs of a turnaround, as retail sales are on the up and up and big names like UPS and JB Hunt announced better-than-expected earnings this month.

But until trucking gets back on its feet, more companies are likely to go bankrupt, according to Jason Seidl, the managing director of air and surface transportation at Cowen.

And others are just on track to not make any money. That includes the Van Buren, Arkansas-based USA Truck, which reported its earnings last week. USA Truck did not respond to a Business Insider inquiry.

USA Truck reported $2.5 million in net income in Q2 2018. In Q2 2019, it reported $1,000 in profits.

Total number of miles driven actually increased in Q2 2019 from the previous year. But revenue per load, a key measure of yield in the trucking industry, fell by 18.4% from 2018. It also sank by 8.5% from Q1 2019.

www.msn.com/en-us/money/companies/trucking-companys-income-plunges-from-dollar25-million-to-dollar1000/ar-AAF1K8o?li=BBnb7Kz