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Spooky scary skeletons send shivers down your spine — this year especially as consumer spending for Halloween is expected to hit $12.2 billion, according to to the National Retail Federation. An NRF study found that 73% of Americans will participate in Halloween-related activities. That might explain why stores had back-to-school goods out for about 30 seconds and Halloween goods hit the stores before school started.
The study found that “Like previous years, the top ways consumers are planning to celebrate are handing out candy (68%), decorating their home or yard (53%) or dressing in costume (50%). However, in a return to pre-pandemic norms, more consumers also plan to throw or attend a party (32%) or take their children trick-or-treating (28%).”
Consumers are starting to spend earlier, which means that the traditional rush of seasonal freight is now less of a rush and better planned out for shippers and transportation partners to work with.
However, what should not come as a surprise is that online shopping has risen in popularity, which means the future will no doubt be more direct-to-consumer sales. The impact of stores like Spirit Halloween should not be underestimated as they remain the place to be for all things spooky, taking 39% of the Halloween shopping market.
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The United Auto Workers union has come out on top after nearly seven weeks of stand-up walkouts, where different locations joined in should demands not be met instead of the traditional strike where all locations act in unison. The UAW has tentatively agreed to deals with Stellantis and Ford, and just a few days ago GM joined the group.
Terms of the deal with GM haven’t been released, but given how steadfast the union was in its demands it’s likely it got pretty close to what it was looking for. The Ford and Stellantis deals include “An immediate 11% raise in the top hourly wage rate, additional pay hikes totaling another 14% during the four-and-a-half years of the contract, as well as a return of the cost-of-living adjustment (COLA) meant to protect workers from rising prices. When the COLA and guaranteed pay increases are combined together, they could lift members’ pay more than 30% over the life of the contract,” according to CNN.
It is expected that the rank-and-file membership will ratify this agreement, but it’s not unheard of for such a deal to be rejected, as we saw at the beginning of October when the rank-and-file struck down the tentative agreement with Mack Trucks.
Here’s hoping this is the end of it and automotive freight can return to the market. This is not the best time for a substantial amount of freight to be missing in action.
SONAR TRAC Market Dashboard
TRAC Thursday. In honor of the Future of Freight Festival taking place in Chattanooga, Tennessee, next week, this week’s Market Dashboard lane is from Chicago to Chattanooga. Unlike anyone flying to Chattanooga on the limited number of nonstop flights, there will be a few stops on this 555-mile journey. The good news for brokers and shippers is that spot rates heading into Chattanooga are trending downward. Outbound tender rejections in Chattanooga are ending the month at 2.67%, and outbound tender rejections are finishing out the month in Chicago at 3.31%. Both markets being below 5% rejections typically indicates that contracted rates will yield more revenue than spot market opportunities.
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Who’s with whom? It looks like XPO has done quite nicely in the post-Yellow world, with a 0.4% claims ratio, the best in company history, and increased on-time percentage, despite taking on additional freight volumes. The average daily shipment count increased by more than 1,000 in each month to over 54,000 in September.
According to an article by FreightWaves’ Todd Maiden, “Revenue in the company’s LTL segment increased 2% y/y to $1.23 billion. Tonnage per day was up 3% and revenue per hundredweight, or yield, increased 6% excluding fuel surcharges. The yield metric was aided by a 4% decline in weight per shipment. Pricing increased by 9% on contract renewals during the quarter, nearly double the increase booked in the second quarter.”
XPO is expecting to take its general rate increase early next year. Given the success of the third quarter, here’s hoping it’s a reasonable increase.
The more you know
Borderlands: US mulls terminating tomato trade agreement with Mexico
Where did Yellow’s freight go?
East Coast vs. West Coast: More imports shift back to Pacific ports
State of Freight takeaways: From the floor of a very weak trucking market