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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.

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Project44 expands real-time visibility into China

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‘Project44’s vision has always been global’

Canada Post to launch weekend parcel delivery by year’s end

A red-white-and-blue Canada Post delivery van on a tree-lined neighborhood street.

Canada Post announced on Friday that it plans to introduce weekend parcel delivery in three major cities later this year, part of a plan to modernize its business model and capture more parcel business from electronic retailers as it tries to return to profitability.

The postal carrier credited this year’s resolution of a drawnout labor dispute with restoring customer confidence in the second quarter, which sparked an early-stage recovery of parcel business and helped reduce the pre-tax loss by a third to US$199.7 million.

The state-owned company also said it reduced costs by 6.3% during the quarter as operational productivity improved. 

Mail carriers represented by the Canadian Union of Postal Workers ratified a contract in early June after more than two years of rocky negotiations, interspersed with two general strikes, rotating strikes by area, and work slowdowns. The volatile labor situation caused huge uncertainty for households and businesses. Many e-commerce shippers switched to using private sector delivery companies, adding to the decline in Canada Post parcel volumes and revenues. 

The retroactive, five-year contract runs through Jan. 31, 2029. 

Canada Post’s loss for the first half was $347.5 million compared to $323 million in the same period last year.

Quarterly revenue grew 1.5% year over year to $1.1 billion, led by a 20.7% jump in parcel revenue as parcel volume increased 15.6%. Letter mail volume declined 9.2% compared to the prior year, which benefitted from an election and related mailings by candidates, which led to a 9.1% fall in mail revenue. The mail business has been trending down for years as more Canadians communicate through digital channels.

Direct marketing mail volume ticked down 0.2%, with a corresponding dip in revenue.

Stability from the labor contract is allowing Canada Post to implement more parcel services, as well as operational efficiencies, such as flexible staffing, tailoring workloads to workforce deployment, vehicle sharing and streamlining letter mail operations.

The national post is working with communities nationwide to convert 621,000 addresses from door delivery to secure community mailboxes by early 2027. In total, about four million addresses will be converted to community mailboxes over several years. 

Centralizing residential delivery is part of a larger transformation plan, which includes closing post offices and lowering delivery standards, to turnaround the company’s finances and improve service. Since 2018, Canada Post has lost $4.76 billion, forcing it to rely on government assistance.

Management sees e-commerce as a growth opportunity and intends to strengthen its position in the competitive parcel delivery market by expanding home parcel pickup service to 8.6 million households; offering box-free, label-free returns with select online retailers; improving local next-day delivery service; offering strategic pricing discounts for businesses; and preparing to launch weekend parcel delivery in the Ottawa, Montreal and Toronto metropolitan areas later this year.

In the second quarter, Canada Post also launched a proof of concept for Canada Shops, a new online marketplace connecting Canadian small businesses with customers across the country through the organization’s delivery network. 

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

Write to Eric Kulisch at ekulisch@freightwaves.com.

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Motive and Highway Restore ELD Data Access After Integration Dispute

Truck electronic logging device

Highway and Motive said in a joint statement that they have reached an agreement to restore the frequency at which Highway can access electronic logging device data belonging to Motive customers when carriers authorize that access, ending a disruption that began earlier after Motive limited the application programming interface connection between the two platforms and indicated Highway would need to compensate it for the data. The companies said they are working together to ensure uninterrupted service for the carriers and brokers that rely on both.

The statement said no action is required from carriers or brokers.

Both companies framed the resolution around carrier authorization. They said they share a commitment to giving motor carriers transparency and control over how their data is authorized and used, and that they are in discussions to update their existing agreement to more clearly reflect current use cases. The companies also said they intend to build on the relationship by identifying opportunities to improve data fidelity, reduce latency and create better experiences for carriers and brokers.

“Motive and Highway both play important roles in the freight ecosystem, and we are committed to serving customers together,” said Jordan Graft, CEO of Highway. “We have a clear path forward that protects carrier choice and allows us to continue improving the experience for brokers and carriers.”

Shoaib Makani, co-founder and CEO of Motive, said: “Our carriers depend on an ecosystem of partners to run their businesses. We are pleased to have reached a path forward with Highway that supports our customers and provides clarity around data use.”

What the Statement Does Not Say

The announcement restores the data flow. It does not resolve the question that stopped it.

Highway’s notice to its brokerage customers earlier this week stated that Motive had asked to be compensated for access to carrier data, and that Highway does not charge carriers and did not intend to begin doing so in order to preserve the connection. The joint statement makes no reference to compensation, licensing fees or any payment between the two companies. Neither company has said whether money will change hands, in which direction, or on what basis.

The statement is also explicit that the underlying contract has not been rewritten. The companies describe themselves as in discussions to update their existing agreement, which places the commercial terms in an open state even as the technical connection returns to normal. What has been announced is a restoration of service, not a settlement.

Neither company disclosed how long the disruption lasted, how many carriers were affected, or how many brokers experienced reduced visibility during the period. Motive serves customers across trucking, construction, oil and gas, agriculture and other sectors and does not break out how many motor carriers have equipment connected to Highway.

The Performance Guarantee Question

One element of the disruption is unaddressed in the joint statement.

When Highway notified its customers of the limits, it said it could not provide location-based Load Lock Alerts for loads hauled by carriers using Motive devices and that it could no longer back freight moved by those carriers under its Performance Guarantee, the commercial backstop under which Highway assumes financial responsibility for outcomes on loads moved by carriers it has verified. Withdrawing that coverage moved risk back onto the broker.

The joint statement addresses data refresh frequency. It does not state that Performance Guarantee coverage has been reinstated for Motive carriers, and neither company has separately confirmed that it has. Whether restored data access automatically returns those loads to covered status is a question for Highway, and it is the detail brokerage risk teams will want answered before adjusting their carrier selection back.

How the Dispute Started

Highway told brokerage compliance leaders this week that Motive had imposed new limits on the existing integration between the two platforms, effective immediately, and had begun restricting API access while indicating that Highway would need to pay for carrier data. Highway said the practical effect was that Motive ELD data refreshed less frequently inside its platform, reducing broker visibility into those trucks.

During the disruption, Highway offered an alternate tracking path for Load Lock Plus customers through its carrier-facing mobile application, while acknowledging that application-based tracking is disconnected from the equipment itself. The company also said it would work with the more than 275 other ELD providers it integrates with to offer discounted alternatives to carriers considering a change, a step that pointed carriers toward Motive’s competitors.

Highway didn’t comment during the disruption. Motive made no public statement until the joint release.

The speed of the resolution is notable. The dispute became public and was resolved inside the same week.

What Remains Open

Three questions survive the announcement. Whether either company will pay the other, and on what terms. Whether Performance Guarantee coverage has been restored for loads moved by Motive carriers. And whether the updated agreement now under discussion will establish a pricing framework for ELD data access that other integrations across the industry might follow.

That third question is the one with reach beyond these two companies. Carrier vetting platforms depend on data connections to dozens of ELD providers, and the commercial terms underpinning most of those connections were set years ago, when both categories were smaller and the verification layer was not yet load-bearing for freight movement.

Why It Matters

A connection that brokers rely on to verify capacity went down and came back inside a week without carriers or brokers taking any action, which demonstrates both how quickly commercial disputes between vendors can reach freight and how little visibility the affected parties have into them. The agreement that governs that connection is still being written, so the conditions that produced this disruption have not yet been resolved.

Port of Los Angeles locks in ONE terminal for 30 more years

Yusen Terminals will continue operating its marine terminal at the Port of Los Angeles through 2056 under a 30-year lease approved this week by the Los Angeles Board of Harbor Commissioners.

The agreement also calls for Yusen, a unit of Singapore-based Ocean Network Express (ONE), to invest an additional $200 million in zero-emission cargo-handling equipment over the coming years, extending the terminal operator’s longstanding presence at the port and supporting its transition to cleaner operations.

ONE comprises Nippon Yusen Kaisha (NYK Line) (9101.TW); Mitsui O.S.K. Lines (MOL) (9104.TW); and Kawasaki Kisen Kaisha (K Line) (9107.TW), all headquartered in Japan.

Yusen has operated at Los Angeles since 1991 on 232 acres encompassing Berths 212-224. With annual volume of around 1.5 million TEUs, it ranks fifth of six terminals there. In addition to ONE vessels, it hosts calls by Hapag-Lloyd; Hyundai Merchant Marine (011200.KS), Wan Hai Lines (2615.TW); and Yang Ming (2609.TW).

“We greatly value our longstanding partnership with Yusen Terminals and the role they play in the success of our Port,” Port of Los Angeles Executive Director Gene Seroka said in a release. “Their commitment to excellence and willingness to work closely with us have been invaluable, especially in advancing our clean air initiatives.”

Seroka said Yusen responded quickly when the port asked terminal operators to test and incorporate zero-emission equipment.

The terminal currently operates a range of zero-emission and hydrogen fuel-cell equipment, including electric top handlers, forklifts and yard tractors. The additional investment under the lease extension will support further deployment of such equipment.

“We’re proud of the operation we’ve built at the Port of Los Angeles and excited about what lies ahead,” Yusen Terminals President and Chief Executive Alan McCorkle said. “This agreement gives us the long-term certainty to continue investing in our terminal, our people and new technology while providing the reliable service our customers expect.”

Yusen’s operations include stevedoring, terminal operations and specialized cargo handling. It’s one of seven marine terminals at LA, including Maersk’s (OTC: AMKBY) APM Terminals; Everport Terminal Services, a unit of Evergreen Marine; CMA CGM’s Fenix Marine Services; and two West Basin Container Terminals operated by China Shipping and Mediterranean Shipping Co. 

Read more articles by Stuart Chirls here.

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DP World reportedly shutting down SeaRates digital freight platform

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Port of Oakland: Steady July amid import drop

Trump administration moves to unwind Obama-era truck engine efficiency rules 

Why it matters: The Trump administration said it is reshaping how future Class 8 trucks are engineered to meet federal fuel-efficiency requirements.

The Trump administration is beginning the process of unwinding federal fuel-efficiency regulations for standalone truck engines and other components.

The White House said the National Highway Traffic Safety Administration exceeded its legal authority under a regulatory framework expanded during the Obama administration in 2016, according to a news release.

NHTSA announced Friday that it has adopted a new interpretation of federal law limiting the agency’s authority to regulating the fuel efficiency of complete medium- and heavy-duty vehicles — rather than separately regulating engines, transmissions, tires and other vehicle components.

The action does not eliminate federal fuel-efficiency requirements for commercial trucks. Instead, NHTSA says manufacturers should have greater freedom to determine how an entire vehicle meets federal efficiency requirements, including through improvements to engines, transmissions, aerodynamics, cab designs or tires.

“The Trump Administration is getting out of the way so manufacturers can decide how they want to meet fuel efficiency requirements,” NHTSA Administrator Jonathan Morrison said in a statement.

Morrison said aligning the program with the administration’s interpretation of federal law will lower commercial truck prices and benefit U.S. manufacturers. NHTSA did not provide an estimate of how much the regulatory change could reduce the cost of new trucks.

The interpretive rule takes aim at regulations developed under the Obama administration as part of a sweeping effort to reduce fuel consumption and greenhouse gas emissions from commercial trucks.

Regulatory battle dates to Bush administration

The origins of the federal program predate the Obama administration.

The Energy Independence and Security Act of 2007, signed into law by President George W. Bush, directed NHTSA to establish a fuel-efficiency improvement program for commercial medium- and heavy-duty vehicles. 

The Obama administration implemented that mandate beginning in 2011 and expanded it through the Phase 2 greenhouse gas and fuel-efficiency standards finalized jointly by NHTSA and the Environmental Protection Agency in 2016.

The Phase 2 regulations established standards for combination tractors, trailers, heavy-duty pickups and vans, vocational vehicles and certain engines powering tractors and vocational trucks. The standards were designed to reduce fuel consumption and greenhouse gas emissions through model year 2027.

At the time, federal regulators estimated the program would save truck owners approximately $170 billion in fuel costs over the life of the regulations. They also projected that buyers of new long-haul trucks in 2027 could recover the additional investment in fuel-saving technology in less than two years through lower fuel costs.

The rules were also intended to accelerate adoption of technologies ranging from more efficient engines and powertrains to aerodynamic equipment and lighter-weight components.

When fully phased in, regulators projected tractors could achieve up to 25% lower fuel consumption and carbon dioxide emissions compared with equivalent 2018 tractors.

Trump administration challenges NHTSA’s authority over engines

The Trump administration actions on Friday are drawing a legal distinction between vehicles and their individual components.

NHTSA said EISA authorizes the agency to establish a fuel-efficiency program for commercial vehicles, but unlike the Clean Air Act — which gives EPA authority over engine emissions — EISA does not give NHTSA explicit authority to regulate engines or components such as transmissions and tires.

The agency also cited the Supreme Court’s 2024 Loper Bright Enterprises v. Raimondo decision, which overturned the Chevron doctrine governing judicial deference to federal agencies’ interpretations of ambiguous statutes.

NHTSA pointed as well to a recent U.S. Court of Appeals for the D.C. Circuit decision that the agency says found it lacks authority to regulate the fuel efficiency of nonvehicle components.

Under NHTSA’s new interpretation, regulators could continue setting fuel-efficiency requirements for a completed commercial vehicle while giving manufacturers more latitude over which technologies they use to achieve those targets.

Trucking industry had sought flexibility under Phase 2

The emphasis on manufacturer flexibility echoes some of the concerns raised by the trucking and manufacturing industries when the Phase 2 standards were adopted a decade ago.

Industry reaction to the final 2016 rule was generally positive, although fleets and manufacturers emphasized the importance of keeping compliance costs manageable and allowing enough time to develop and deploy new technologies.

American Trucking Associations officials were “cautiously optimistic” when the standards were finalized, according to a news release. ATA said it was pleased regulators had addressed concerns over technology-development lead times and flexibility, while warning that the program’s ultimate success would depend on fleets’ willingness to purchase the new technologies.

Daimler Trucks North America similarly supported the Phase 2 goals but said the rules needed to establish long-term targets for the entire vehicle rather than focusing solely on the engine, while providing manufacturers and customers enough flexibility to determine economically feasible ways of reaching the targets, according to Heavy Duty Trucking.

Other manufacturers also supported the overall efficiency objectives. Paccar said it would meet the standards while delivering fuel-efficient Kenworth and Peterbilt trucks, while Volvo Group North America called improved fuel economy a goal stakeholders could unite around but described the targets as a significant challenge for the industry.

The shift could also carry trade-offs. Engine-specific standards were designed to accelerate deployment of technologies that reduce diesel consumption and greenhouse-gas emissions. 

EPA and NHTSA estimated the broader Phase 2 program would save truck owners about $170 billion in fuel costs and reduce CO₂ emissions by roughly 1.1 billion metric tons over the lifetime of covered vehicles. 

Removing NHTSA’s engine-level requirements could give manufacturers greater flexibility and potentially lower upfront equipment costs, but the effect on long-term fuel consumption and emissions will depend on how the agency structures its vehicle-level standards.

Existing standards don’t disappear yet

Friday’s action does not immediately repeal the existing medium- and heavy-duty standards.

NHTSA said the interpretive rule establishes the legal foundation for a forthcoming notice-and-comment rulemaking that would formally reset its medium- and heavy-duty vehicle program.

Until that process is completed, the agency said it will exercise its enforcement authority consistent with its new interpretation.

The move also concerns NHTSA’s fuel-efficiency authority and does not, by itself, eliminate EPA’s separate authority under the Clean Air Act to regulate emissions from heavy-duty engines.

Bot Auto commits to U.S.-based remote assistance operators

Bot Auto autonomous trucks lined up with Texas Highway Patrol SUVs and a first-responder ambulance

Bot Auto is keeping its remote assistants based exclusively in the U.S., the Houston autonomous trucking company announced Thursday.

These remote assistants sit between a driverless truck and whoever walks up to it but perform no part of the actual driving. The vehicle operates autonomously at all times. Their function is communication and coordination: direct contact with first responders and law enforcement in the field, plus limited vehicle actions during an incident.

“Remote assistants play a critical role in Bot Auto’s operations, providing a human layer of support and oversight for our autonomous fleet. We’re building out America’s 21st-century supply chain. It needs to be extremely resilient, and that’s why it’s critical that these roles are always kept within the United States,” said Brian Moore, Bot Auto’s chief policy officer.

Bot Auto runs a Level 4 fleet out of Houston and sells transportation as a service, positioning itself inside what it calls the Texas trucking triangle.

What Remote Assistance Operators Do at the Roadside

The work is already running in live operations. Remote assistants monitor operations from Bot Auto’s mission control today, confirming vehicle status and passing along cargo and routing information. They can remotely actuate functions such as hazard lights. They can also facilitate a vehicle shutdown at an officer’s direction.

That last capability is the one that matters during a traffic stop. With no one in the cab, the shutdown request has to go somewhere. Bot Auto’s answer is a person in the United States, not one offshore.

The Question the Senate Already Asked

Where those people sit became a Washington issue in February. Waymo Chief Safety Officer Mauricio Peña told a Senate hearing that part of the company’s robotaxi support staff works overseas. Waymo operates four remote assistance centers, two of them in the Philippines and the others in Arizona and Michigan, with roughly 70 agents on duty at any given time, Automotive World reported. The company says those agents supply contextual guidance and cannot control vehicle movement, and that the onboard system stays the real-time authority.

Sen. Ed Markey, D-Mass., took that disclosure and turned it into an investigation. His office surveyed seven developers, including autonomous trucking company Aurora, and published the findings March 31. Waymo was the only one of the seven using overseas remote assistance operators, and the only one where a substantial share of that workforce does not hold a U.S. driver’s license. Latency between vehicles and operators varied by company, with each setting its own threshold for what counts as a safety risk. Every company refused to say how often its operators intervene.

Autonomous vehicle developers “have long boasted they can eliminate road fatalities caused by human error,” Markey said. “Now it is time they are honest about their technology’s reliance on human help.”

Bot Auto was not among the seven. It is getting ahead of that question as autonomous trucking companies gain more adoption.

‘Every Mission Has a Mission Control’

In an emergency, the response window is measured in seconds. A first responder arriving at an incident involving an autonomous truck needs to reach an assistant instantly, communicate clearly and start a vehicle response.

“Every one of our vehicles has a mission, and every mission has a mission control,” said Bart Teeter, Bot Auto’s director of fleet and operational safety. “Our remote assistants aren’t driving the truck, but they are the voice on the other end of the line when an officer needs one, and they can act on the vehicle directly when it matters. Committing to U.S.-based remote assistants is about making sure that when a first responder needs us, there is no delay, no miscommunication, and no gap in accountability. We work hand-in-hand with law enforcement and emergency services, and this is a direct reflection of that responsibility.”

Bot Auto has run ride-alongs and training sessions and coordinated on incident response protocols specific to autonomous trucks as it has scaled operations across Texas.

Federal Regulators Flag First-Responder Interactions

The timing of this announcement didn’t happen in a vacuum. The National Highway Traffic Safety Administration sent a call-to-action letter to autonomous vehicle developers on July 8, seven weeks before Bot Auto’s announcement. Administrator Jonathan Morrison’s agency cited driverless vehicles that drove into active emergency scenes, blocked the paths of ambulances and firefighters or failed to recognize flashing lights, flares, smoke, fire and traffic cones. NHTSA said an automated vehicle that cannot safely interact with first responders is a danger to the general public. The agency scheduled meetings with driverless developers by the end of that month and reserved its authority to take enforcement action.

Bot Auto casts the remote assistant model as one piece of what it describes as a broader safety architecture, built on validation testing and coordination with regulators and emergency services. The company calls domestic staffing a baseline expectation for any autonomous vehicle operator in the United States.

“The ability to clearly and reliably communicate with a remote assistant during an emergency situation is critical to first responders,” said Maj. Omar Villarreal of the Texas Department of Public Safety. “Miscommunication or poor connections can potentially cost valuable time in addressing emergency conditions. Autonomous vehicle operators committing to U.S.-based remote assistants convey that they are committed to their responsibility in engaging first responders by making effective communications a priority.”

China gains as geopolitics redraws new global container port rankings

The global container-port hierarchy shifted sharply in the first half of 2026, with Ningbo-Zhoushan overtaking Singapore for second place and Port Klang, Malaysia entering the top 10.

The biggest reversal occurred in the Middle East, where Dubai’s Jebel Ali fell from 10th to 32nd as disruptions from the Iran war around the Strait of Hormuz diverted cargo and forced carriers to redesign their networks.

China’s Shanghai remained the world’s busiest container port, handling about 28.7 million container units in the first six months of 2026, a 6.2% increase from the same period a year earlier, according to Alphaliner. Ningbo-Zhoushan handled 22.9 million TEUs, up 8.8%, narrowly passing Singapore, which processed approximately 22.7 million TEUs, up 4.7%.

The gains come as China finds new markets for exports despite attempts by the Trump administration to blunt Beijing’s economic dominance through trade and tariff policy.

The margin was only 158,310 TEUs, making the contest for second place highly vulnerable to normal seasonal swings during the rest of the year. Ningbo-Zhoushan’s first-half performance nevertheless marked the first time it had ranked ahead of Singapore over a six-month period.

China held six of the top 10 positions. Shenzhen, Qingdao, Guangzhou and Tianjin ranked fourth through seventh, followed by Busan in eighth, the combined Los Angeles-Long Beach U.S. gateway in ninth and Malaysia’s Port Klang in 10th. 

The latest reshuffling builds on China’s strong full-year performance in 2025. Shanghai handled a record 55.06 million TEUs, while Singapore processed 44.66 million and Ningbo-Zhoushan reached 43.87 million. Ningbo’s 11.6% growth was the strongest among the three leading ports.

No port experienced a more dramatic reversal than Jebel Ali. The Dubai hub handled only 3.14 million TEUs in the first half of 2026, less than half the 7.77 million TEUs recorded in the first half of 2025.

The decline accelerated in the second quarter, when throughput fell more than 90% year over year to just 374,000 TEUs. The port consequently dropped from 10th place in the global rankings at the end of 2025 to 32nd in Alphaliner’s half-year assessment. Abu Dhabi’s Khalifa port also suffered an estimated decline of at least 50% and fell out of the global top 50.

The immediate cause was the disruption surrounding the Strait of Hormuz. The waterway was nearly closed in March, followed by only a partial and unstable reopening in June. Carriers reduced or altered calls in the Persian Gulf, while shippers sought alternative routes and relay points.

The Middle East disruption is part of a broader reorganization of relay traffic. In 2025, cargo moving through transshipment hubs shifted toward southeast Asia as carriers continued to avoid the Red Sea and route more vessels around Africa’s Cape of Good Hope.

That helped Singapore, Tanjung Pelepas in Malaysia and Colombo, Sri Lanka. Tanjung Pelepas recorded the fastest growth among the leading ports, increasing throughput 14.5%, or nearly 1.8 million TEUs, and rising from 16th to 13th place. Singapore grew 8.6%, while Colombo increased 6.5%.

Alphaliner estimated that throughput at the world’s leading container ports rose 5.2% in 2025, compared with 4.7% growth in the broader container trade. The difference reflected rerouting, network disruption and additional handling as cargo was transferred through different hubs.

Other ports also advanced in the first half of 2026. Colombo climbed from 26th to 20th, India’s Nhava Sheva rose from 28th to 21st and Jakarta, Indonesia moved from 27th to 23rd. By contrast, Germany’s Hamburg slipped from 23rd to 27th, Kaohsiung of South Korea fell from 22nd to 24th and India’s Mundra declined from 24th to 26th.

In 2025, the world’s top 20 container ports handled nearly 450 million TEUs, an increase of roughly 5% to 6%. Fifteen were in Asia, while China accounted for nine of the top 20. The top 10 remained unchanged on a full-year basis, but the pace of growth varied sharply among individual ports.

U.S. and European gateways remain important, but their presence near the top of the global volume table is narrowing. The combined LA-Long Beach gateway was the only non-Asian port in the first-half top 10. The Port of New York and New Jersey handled about 4.4 million TEUs and fell one position to 22nd.

Read more articles by Stuart Chirls here.

Read more:

Drewry index edges lower on decline in trans-Pacific rates

DP World reportedly shutting down SeaRates digital freight platform

Ocean rate concerns as orders for new container ships near 40% of global fleet

Port of Oakland: Steady July amid import drop

New return: Another container line is back in the Red Sea

BLS: more transportation/warehousing workers than believed

The Bureau of Labor Statistics is estimating that there are a significantly larger number of workers in the Transportation & Warehousing sector this year than the base model it has been using for its 2026 employment reports.

The BLS, in its preliminary benchmark revisions report released Friday, said there were a whopping 135,100 more workers in Transportation & Warehousing in March 2026–the baseline for its report–than it has assumed for this year. 

That is a 2% difference from the existing model. That 2 percent figure is the second-largest adjustment in any of the categories, either up or down. The sector dubbed Information is up 3%. 

The largest decline was in Wholesale Trade, down 1.4%.

The benchmark numbers in the report are that total private employment is 178,000 jobs less than the current model numbers, while government jobs are 99,000 jobs. That is an overall estimate of 79,000 fewer jobs than is currently being used as a model.

It also is the smallest downward revision in three years. 

One key aspect the annual BLS revision does not report is the shift in subsectors. So there is no estimate on the shifts in the 2026 model in such fields as truck transportation, rail or warehousing. 

Besides those three, the other subsectors under Transportation & Warehousing are air transportation, water transportation, transit and ground passenger transportation, pipeline transportation, scenic and sightseeing transportation, support activities for transportation and couriers & messengers.

Warehousing and storage has the largest number of jobs among those subsectors, with a reported July number of 1.835 million. Truck transportation was second at 1.465 million. 

The total for the entire sector in July was approximately 6.6 million jobs. 

Aaron Terrazas, an independent economist who studies labor markets and with a background in transportation, said last year’s downward revision “was the first data canary hinting at a softening labor market — a trend that continued through late 2025 and early 2026.”

The big jump in Transportation and Warehousing, Terrazas said, was an “outlier,” suggesting slightly stronger payrolls while the data for most other industries suggested softer payrolls.”

Given that the specifics of the subsectors are not known, Terrazas said the “accelerating carrier exits” makes it unlikely that trucking drove the forecast gains in the larger sector.

“My hunch is that parcel delivery services and perhaps taxi services were the primary drivers of the upward revision,” he said in an email to FreightWaves.

Calendar for the rollout

Changes in the model will not show up in the monthly employment report until January numbers are reported in February. At that point, the preliminary estimates will have been further revised into a final new baseline model.

With that in hand, a comparison of what is in that report with what was originally reported by the BLS will provide insight into how individual sectors contributed to that 135,100 total number. 

The next employment report will be released Friday, September 4.

More articles by John Kingston

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One man paints challenging outlook for brokers’ insurance

Arizona police recover $400K in stolen cargo during stops 20 minutes apart

A stolen-load alert in northern Arizona led investigators to roughly $400,000 in recovered cargo across two interstates. Detective Curtis Peery of the Coconino County Sheriff’s Office received notice that a stolen shipment was traveling through the region. He began searching Interstate 40 and located the suspected trailer. Peery then sent identifying information to the company for verification.

The company confirmed the trailer and alerted Peery to another stolen load near Phoenix. That vehicle was traveling on Interstate 10 while Peery continued preparing his northern Arizona operation. Peery contacted Sgt. Jeffrey Gordon of the Phoenix Police Department and provided information about the second truck. Gordon coordinated with an Arizona state trooper to intercept that vehicle.

The trooper stopped the Interstate 10 truck first near Phoenix. Peery remained focused on the original shipment he had located farther north. Twenty minutes later, his team stopped the Interstate 40 vehicle. The two operations recovered roughly $400,000 in merchandise, according to Peery.

One alert expands into two stops

The investigation began with information about a single stolen shipment moving through northern Arizona. Finding that trailer gave Peery a direct connection with the company tracking its missing freight. Confirmation of the first vehicle produced information about another stolen load. That development expanded the operation beyond Interstate 40.

Peery still needed time to position his interdiction team when he learned about the second truck. Calling Gordon allowed another officer to pursue the Interstate 10 vehicle without delaying the northern operation. Both teams then worked separate highways toward the same objective. Their stops occurred about 20 minutes apart.

Gordon described the coordination in a LinkedIn post following the recoveries. He credited communication between investigators with helping bring the operation together. “Powerful things happen when you are paired with the correct team and communication is at the forefront,” Gordon wrote. His post also showed both recovered trucks during the Arizona investigation.

Investigation continues after recoveries

Authorities made arrests during the operations, according to information Gordon provided about the case. Officials have not publicly identified the suspects or announced specific charges. The exact commodities inside the recovered trailers also remain unclear. Additional details about where the original thefts occurred were not immediately available. FreightWaves will update this story if officials provide further information. The confirmed recoveries remain roughly $400,000 between both Arizona stops.

Why It Matters

Stolen freight can move across jurisdictions quickly, making communication critical during an active cargo theft investigation. This case shows how information from one recovery can help investigators locate another shipment before it disappears.

CFCO

Gordon completed the FreightWaves Certified Fraud Compliance Officer course before working this case. He told FreightWaves the training helped him communicate with a cargo theft investigator and ask stronger industry-specific questions. CFCO gives law enforcement industry knowledge they can apply during investigations. “This works for cops too,” Gordon said.

Click here for more articles on cargo theft and freight fraud by Phil Brink.

Georgia authorities intercept 1,800 pounds of marijuana in shipment headed toward Atlanta, Orlando – FreightWaves

Deputies recover $150K in New Balance shoes after BNSF boxcar burglary – FreightWaves

Police recover $258K copper load from stolen J.B. Hunt trailer in North Carolina – FreightWaves

Reported cargo theft rises 5% in Q2 as Southern California remains a hot spot

Cargo thieves targeted 605 reported loads across the United States during the second quarter, according to a new Overhaul report. That total rose 5% from the first quarter but fell 5% from one year earlier. May produced the highest share, accounting for 35% of quarterly activity. California and Texas remained the largest state-level hot spots.

The cargo-security company recorded an average of about 202 incidents each month from April through June. That equals roughly 6.7 reported cases daily. Its figures cover thefts reported through sources including law enforcement, insurers and transportation security councils. They do not capture every cargo crime or standalone thefts of trailers, containers or bobtail tractors.

California accounted for 34% of the reports, while Texas represented 18%. Tennessee followed with 13%, Pennsylvania had 10%, and Illinois recorded 8%. Electronics led California targets, followed by food and drinks, clothing and shoes, and miscellaneous goods. Texas incidents most often involved home and garden products, electronics, and building or industrial materials.

Electronics lead targeted commodities

Electronics represented 23% of all recorded cases during the quarter. Miscellaneous cargo ranked next at 20%, while clothing and shoes made up 10%. Those three categories combined for 53% of the activity. Within the electronics category, mixed and miscellaneous shipments led, followed by batteries and panels.

Miscellaneous cargo showed the sharpest rise among the larger product groups. Reports involving that category increased 38% from the first quarter and 84% from the same period last year. Clothing and shoes climbed 25% quarter over quarter and 4% year over year. Building and industrial freight also increased across both comparisons.

Friday accounted for 18% of incidents, the highest share of any day. Early morning activity between midnight and 6 a.m. made up 28% of reports. The next two six-hour periods each held similar shares. That timing leaves little room for a delayed response when a shipment stops moving.

Warehouses, truck stops and rail sites draw attention

Pilferage accounted for 46% of the incidents, making it the most common event type. Full truckload theft followed at 21%, while facility theft represented 16%. Deceptive pickup made up 11% of recorded activity. Texas had the largest share of full truckload theft reports.

Warehouses and distribution centers accounted for 37% of locations where the data identified a site. Truck stops and fuel stations followed at 15%, while rail locations represented 11%. California, Tennessee and Texas recorded most warehouse-related cases. Illinois, California, Arizona and Tennessee led rail theft reports.

The report identified Southern California as a major concentration point during the past 12 months. The region within 200 miles of Torrance accounted for 37% of recorded U.S. thefts. The area averaged 81 incidents per month, up 28% from the prior period. Nearly seven in 10 cases occurred within 50 miles of Torrance.

Southern California deceptive pickups rise

Pilferage remained the leading method in the Southern California zone, representing 45% of cases. Deceptive pickup increased from 24% to 28% compared with the previous analysis. Warehouse and distribution center locations accounted for 55% of activity there. Electronics, clothing and shoes, and food and drinks drew the most attention.

The report notes that recent reports can increase after publication because incident information often arrives late. Overhaul updates earlier totals when comparing current activity with past periods. The figures show reported cases, not a complete count of every cargo theft nationwide.

Why it matters

Cargo theft risk remains concentrated around major freight hubs, but the methods and locations vary widely. Shippers, brokers and carriers need to verify the people, equipment and business behind every shipment before release.

CFCO perspective

In my opinion, CFCO training gives freight teams a practical framework for recognizing and responding to deceptive pickup risks. It reinforces a simple discipline: When something does not look right, slow down and confirm the details before freight moves.

Click here for more articles on cargo theft and freight fraud by Phil Brink.

Deputies recover $150K in New Balance shoes after BNSF boxcar burglary – FreightWaves

Police recover $258K copper load from stolen J.B. Hunt trailer in North Carolina – FreightWaves

CBP finds $9.5M in meth hidden inside detergent shipment at Texas border – FreightWaves

Motive Restricted Highway’s Data Access Over a Payment Demand

Highway notified its customers this week in an email communication, that Motive had imposed new limits on the integration between the two platforms, telling compliance leaders that the electronic logging device provider had begun restricting its application programming interface connection and had indicated Highway would need to compensate it for access to carrier data. The change took effect immediately, according to the notice.

Highway’s stated position is that it does not charge carriers for its services and does not intend to begin charging them in order to preserve an ELD connection. The company said the practical result is that Motive ELD data now refreshes less frequently inside its platform.

The downstream effects Highway described are specific. Brokers hiring carriers that run Motive hardware now have reduced visibility into those trucks. Highway said it cannot currently provide location-based Load Lock Alerts for loads hauled by those carriers, and that it can no longer back freight those carriers move under its Performance Guarantee. The company said it would offer an alternate tracking path through its carrier-facing mobile application for Load Lock Plus customers, while acknowledging in the notice that application-based tracking is disconnected from the equipment itself. Highway also said it would work with the more than 275 other ELD providers it integrates with to offer discounted alternatives to carriers considering a change.

The Performance Guarantee is a commercial backstop under which Highway assumes financial responsibility for outcomes on loads moved by carriers verified through its platform. The company introduced it as a differentiator, positioning itself as the first carrier vetting platform to put its own capital behind its verification work. Withdrawing it for a subset of carriers returns that risk to the broker.

What Has Not Been Established

Motive has not publicly addressed the change. No trade publication had reported on the dispute at the time of writing, and no filing, press release or customer communication from Motive describing its reasoning has surfaced. Highway declined to comment beyond the notice sent to its customers. The account above comes entirely from that notice, and Highway is an interested party.

Neither company has disclosed the commercial terms at issue. What Motive asked Highway to pay, what the original integration agreement provided for, and where any discussions between the two companies currently stand are all unknown.

The number of affected carriers is also unpublished. Motive serves customers across trucking, construction, oil and gas, agriculture and other sectors, and does not break out how many motor carriers have equipment connected to Highway. Any estimate of the affected population would be speculative until one of the two companies discloses it.

Several claims circulating alongside the notice are not supported by it. The notice does not describe a disconnection or a loss of data. It describes reduced refresh frequency, the removal of a specific alert product, and the withdrawal of a commercial guarantee. Carriers running Motive hardware remain visible inside Highway. What changed is the frequency of the underlying data and the risk position Highway is willing to take on loads those carriers move.

Whether brokers alter routing behavior as a result is unknown. The notice makes no claim about carrier load volume, and no data covering the period since the change has been published.

The Reach Question

Highway’s public marketing states that the company is behind 80 percent of United States brokered loads and holds active certificates of insurance on more than 175,000 carriers. That figure is a self-reported measure of platform reach rather than an audited market share number, and platform involvement in a load is not equivalent to control over whether the load is tendered.

The more independently established measure of Highway’s position comes from its August 2025 growth equity round, led by FTV Capital with participation from Lead Edge Capital. At that point the Dallas company, founded in 2022, served more than 1,050 brokers, including 70 of the 100 largest brokerages in the country. Brokers handle roughly 30 percent of all truckload spend.

That concentration is the reason a bilateral integration dispute between two vendors carries market-level implications. Carrier vetting has consolidated onto a small number of platforms over the past four years, and the commercial terms underpinning those platforms have not been tested publicly until now.

Motive’s Position Going Into the Dispute

Motive filed publicly for an initial public offering on December 23, 2025, applying to list Class A common stock on the New York Stock Exchange under the ticker MTVE, with JPMorgan, Citigroup, Barclays and Jefferies leading the offering. The listing has not priced. The stock is not trading. The registration statement has been open for eight months.

The financial picture in that filing is relevant context. Motive reported revenue of $327.3 million for the nine months ended September 30, 2025, an increase of roughly 22 percent year over year, against a net loss of $138.5 million. The loss widened from $113.9 million in the comparable period a year earlier. In the third quarter alone, the company recorded a net loss of $62.7 million on revenue of $115.8 million. A 2022 funding round valued Motive at $2.85 billion. The company remains in patent litigation with Samsara.

Whether those conditions motivated the decision to seek compensation from Highway is not established. Motive has made no statement connecting them. The financial figures are drawn from the company’s registration statement and the reporting that followed it, and the timing is a matter of record rather than an explanation.

Highway’s model runs the other direction. Its revenue comes from broker subscriptions, and carriers access the platform at no cost, which is central to how the company assembled its carrier network. A per-connection fee paid to an ELD provider would either compress margin or migrate to carriers, and carrier-side charges would conflict with the free-access position the company has held publicly, including in its 2025 response to questions about its handling of ELD data.

What the Dispute Actually Tests

The substantive question raised here is not which company is right. It is who holds commercial rights to the operational data a motor carrier generates, and what happens to freight movement when the parties to that question disagree.

Carriers purchase ELD hardware and pay monthly subscriptions to satisfy hours of service recordkeeping obligations under Part 395. The data those devices produce has since acquired a second function, serving as the verification layer that brokers use to confirm equipment presence and movement before tendering freight. That second function developed without a settled commercial framework governing who pays whom for the connection that carries it.

Highway has stated publicly that carriers control their own ELD connections and can connect or disconnect at will, and that it accesses carrier data only with authorization. That describes the mechanics accurately. It does not address the commercial arrangement between the two vendors, which carriers are not party to and have no standing in. Carrier consent governs whether data moves. It does not govern what one company may charge another to carry it.

For brokerage executives, the immediate exposure is narrower and more concrete. Loads moved by carriers running one specific ELD platform no longer carry a guarantee those brokers had priced into their risk posture, and the alternative tracking method Highway has offered is, by its own description, less reliable than the equipment-linked connection it replaces.

Neither company has publicly described the state of discussions between them or indicated a timeline for resolution.

Nothing in the dispute alters federal compliance obligations. Motive devices remain FMCSA-registered and continue to satisfy hours of service recordkeeping requirements under Part 395. What changed is commercial visibility inside a private vetting platform, an arrangement that sits alongside the federal requirement rather than within it.

Why It Matters

Carrier vetting has consolidated onto a small number of platforms whose access to operational data depends on commercial agreements between vendors that neither carriers nor brokers are party to. When one of those agreements breaks down, the verification layer brokers rely on degrades without any action by the carrier being verified.