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USPS quarterly parcel volumes fall 12% as e-commerce plan implemented

Side view of a USPS van being loaded from the rear by letter carrier.

The continued decline in mail and parcel volume contributed to a 64% drop in controllable income for the U.S. Postal Service during the first quarter, underscoring why Postmaster General David Steiner is pushing to grow revenue through higher rates and a new program aimed at attracting retailers to handoff e-commerce shipments for last-mile delivery.  

More than 1,200 companies have shown interest so far in bidding for last-mile service, Steiner said in a presentation to the USPS Board of Governors on Thursday afternoon, adding that programs for first-mile package collection from retailers, as well as returns, could be established later this year. 

The fact that results went south during the strongest shipping period of the year, when seasonal surcharges and higher rates are applied, raises questions about the level of progress five years into a transformation plan designed to increase efficiency. Steiner, who took the helm last summer, acknowledged that more work remains to make the organization financially sustainable.

Postal Service operating revenue dipped 1.2% to $22.2 billion, while expenses increased 4.6% to $23.5 billion, year over year for the three months ended Dec. 31, according to financial results released Thursday. Transportation costs, which have been heavily targeted by a multi-year transformation strategy, rose 2% to more than $2.4 billion. Controllable income, essentially adjusted operating income that excludes expenses such as workers compensation that are out of management’s control, plunged to $350 million from $968 million. 

Net loss for the quarter totaled $1.3 billion after the Postal Service posted a $144 million profit in the prior year period. Beyond lower revenues and higher costs, the bottom line was impacted by increases in unfunded employee and retiree benefit costs, such as workers compensation, that are mandated by law. Last year, the USPS lost $9 billion, with a controllable loss of $2.7 billion, despite a short-lived profit during the first quarter.

Parcel revenue was essentially flat on a volume decrease of 243 million pieces, or 12.1%. Strong demand for USPS Ground Advantage, the organization’s economy product with two-to-five day service standards, and price increase for package services (catalogs and other large printed media) helped offset revenue decreases in Priority Mail and Parcel Select services resulting from increased last-mile competition for e-commerce delivery, in-sourcing from major customers like Amazon, and the trend away from expedited products, according to the Postal Service. Volumes declined in all parcel categories except Ground Advantage.

First-class mail revenue increased 1% on a volume decline of 702 million pieces, or 6.1%, versus the same quarter last year. Marketing mail revenue fell 2.7% on a 10.9% decline in volume. 

On the positive side, the USPS was able to deliver mail and packages within two and a half days on average compared to 2.8 days and on-time delivery scores were higher across nearly all product types, with the best scores coming at the post office level, according to the financial report. The Postal Service actually demonstrated the largest performance improvement among major parcel carriers, meeting on-time delivery standards 94.1% of the time during December compared to 90.4% in 2024, according to data analytics and consulting firm ShipMatrix. 

ShipMatrix’s methodology excludes delays caused by weather, but the Postal Service is required to report service performance without regard to circumstances beyond its control, something Steiner said he is working to correct because it doesn’t provide useful information for customers.

Compared to last year, the Postal Service recorded a 23% reduction in calls to its customer care center and a 44% decline in package related customer service inquiries, which management attributed to technology investments and better logistics planning.

“While we are pleased that the holiday quarter was quite strong with regard to service improvement as measured by our on-time delivery scores and other important service performance metrics, we continue to face difficult systemic financial and business model headwinds,” Steiner said in the earnings announcement. “To right our financial ship, we are aggressively pursuing growth strategies — which include creating new opportunities for businesses to leverage our vast last-mile delivery network – and driving greater efficiencies throughout our operations. We are convinced that these efforts, if combined with needed regulatory, administrative, and legislative changes, can meet the needs of the American public and return the Postal Service to long-term financial stability and strength.”

Last-mile e-commerce revenue 

Leadership says it needs to achieve further operational efficiencies, boost revenue by offering more innovative products that increase demand, and secure legislative and regulatory reforms for the turnaround plan to succeed.

Steiner last month launched a revenue initiative aimed at driving greater use of the last-mile delivery network by large e-commerce merchants and logistics intermediaries. Shippers who drop off bulk parcel loads can now digitally bid for access to local post offices for doorstep delivery. Steiner’s predecessor, Louis DeJoy, forced large shippers to deliver parcels to intermediate distribution centers— so the Postal Service could do the sorting itself and charge higher rates — instead of thousands of destination delivery units. But the system was only open to direct shippers, not logistics providers, and was only used by a limited number of very large companies because of the high volumes required to make it economical. 

“Allowing customers to bid on last mile capacity is building a new win-win partnership model. It improves their service while reducing their costs and builds revenue for the Postal Service,” the Postmaster General told the board. 

The new way “is more transparent, better adapted to today’s e-commerce landscape and, most of all flexible, to their needs. And to date, more than 1,200 companies and individuals have requested to join the portal. Not all 1,200 will be qualified bidders but the sheer number shows the dramatic interest in our last mile. Why this matters is that we’re giving customers the ability to fit our network to their business. No longer forcing their business to fit our bureaucracy,” Steiner added.

The last-mile bid portal is a model for how the USPS can innovate to get better asset utilization and grow. “We must be willing to test new models like last mile bidding and then scale what works,” he said.   

“As we look at 2026, I see growth priorities in finding and enhancing strategic partnerships that expand reach, volume and relevance, bolstering flagship products that improve service and reliability — improvements that customers can really feel, leveraging our first-mile assets and capabilities from collection to retail to returns to upstream logistics so we can capture value earlier in the pipeline. I believe that these things we can control can help us evolve, help us create and maintain a stronger, more modern posture in today’s market.”

Structural hurdles

Mail volumes, including bulk marketing mail, have declined 50% since 2007, according to the Postal Service. Despite these declines, mail services still accounted for more than half of operating revenue in 2025. While the postal carrier has received some additional pricing flexibility from the Postal Regulatory Commission in recent years, mail services are still subject to an inflation-based price cap system that officials argue limits their ability to offset declining volumes or generate increased revenue. 

Steiner last month asked the Postal Regulatory Commission to provide the Postal Service with unlimited power to raise prices for all first-class mail, marketing mail, newspapers and magazines, areas where the agency dominates the market. Direct mailers and other critics warned against granting unrestricted rate increases, saying the recent proliferation of hikes in mailing rates and stamp prices has driven away customers and that further price increases will hurt the public and businesses alike. 

“USPS cannot afford to continue prioritizing packages over mail and penalizing its biggest revenue generator,” said Kevin Yoder, executive director of Keep US Posted, an advocacy group that includes nonprofit organizations, newspapers, greeting card publishers, magazines, catalogs and small businesses fighting for an affordable Postal Service. “The package growth DeJoy [the previous postmaster general] sought has not, and will not, materialize. While businesses and consumers have many private sector options for package delivery, we all rely on USPS to deliver the mail, and it’s the only service provider that delivers anywhere in the U.S.  It’s easy to attribute decreasing mail volume to the growth of digital communication, but the fact is that price increases and productivity declines are pushing even more mail out of the system. The USPS cannot continue to vampirize the mail, its biggest revenue source, and compromise the mail delivery on which both Americans and businesses depend.”

One reason costs continue to rise is that the number of delivery points keeps growing. Last year, the USPS delivered to 1.8 million more addresses than in fiscal year 2024. The combination of more daily stops and lower mail volume has resulted in a drop in the average number of pieces delivered per delivery point per day from 5.5 pieces in 2007 to 2.4 pieces in 2025, a decline of 57%, according to the national post. 

The Postal Service continues to press Congress and regulators to lift onerous retirement benefit and worker compensation requirements that other agencies and private companies don’t face. It also wants the ability to diversify pension investment vehicles beyond bonds, a higher statutory debt ceiling, and more flexibility over pricing to better respond to market conditions and recoup costs.

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

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When drivers say no: Truckers speak out about unsafe working conditions

Truck drivers across the U.S. say they are increasingly pressured to operate equipment they believe is unsafe — from dilapidated trailers, to overloaded tankers and malfunctioning braking systems — and some say speaking up can cost them their jobs.

Two former truck drivers interviewed by FreightWaves, who requested anonymity due to fear of retaliation, described what they say were repeated attempts by their former employers to push productivity over safety. 

Their experiences highlight both the risks drivers face on the road and the legal protections available when drivers refuse unsafe work.

“This trailer is not safe to move”

One former over-the-road truck driver said the Texas-based company he worked for repeatedly attempted to pressure him into hauling damaged or improperly repaired trailers, including equipment with brake defects, alignment problems and visible structural damage.

“I told them flat-out, this trailer is not safe to move,” the driver said, describing an incident involving a trailer that had recently rolled over. “They kept trying to push me anyway.”

In another exchange, the driver said he made clear he would not attach to unsafe equipment.

“I told them, ‘This trailer is not safe to move. I am not going to hook up to this thing,’” he said. “They were trying to push me anyway.”

He said dispatchers sometimes urged him to continue driving equipment that should have been taken out of service — even after licensed mechanics warned the carrier that the trailer could not legally return to the road.

Ultimately, the driver refused. “Part of my job is to check that equipment before it goes on the road,” he said. “If I touch the road with unsafe brakes and someone gets hurt, that’s on me.”

He said his decision to refuse unsafe equipment may have prevented a serious accident and that his motivation was never personal retaliation.

“This isn’t about vengeance. It’s about safety,” he said. “There are other companies doing the same thing, and it gives the whole industry a bad name.”

“There are other companies doing this,” he added. “And unless drivers know their rights, it keeps happening.”

“They counted bathroom breaks against productivity”

A driver based in Illinois, who is pursuing an OSHA whistleblower complaint against his former company, described a workplace culture in which drivers were penalized for stopping — even to use the restroom — because non-driving time was treated as unproductive under the carrier’s internal metrics.

He said drivers were given a basic reference sheet showing which activities counted toward productivity (i.e. loading, unloading, fueling and similar tasks). “Outside of those listed categories, most on-duty time when the truck wasn’t moving would lower your productivity average,” the driver said. “There was never a clear written explanation of how time spent waiting in line, sitting in traffic, in the shop, calling dispatch, or handling normal needs like restroom breaks was actually calculated. Because of that, drivers were often unsure how much of that time counted and how much did not.”

The driver said he raised repeated concerns about basic human needs, weight compliance and safety inspections — all documented in emails and messages — but received no corrective action before being terminated.

He has since filed a retaliation complaint under federal whistleblower statutes.

Alleged pressure to overload tankers

The Illinois-based truck driver said he also faced systemic pressure from his previous employer to overload fuel tankers beyond legal limits to meet productivity and financial targets.

“If truck stop shows they only have space for 7,500 gallons, you should load 7,500,” the driver said. “The expectation was to average roughly the maximum legal load (around 7,800 gallons). If a location only had space for less, I would load what fit, but that shortfall affected the running average. Drivers were then expected to bring the average back up on later loads, which created pressure to push higher numbers over time.”

He said internal metrics penalized drivers who stayed under legal maximums, while rewarding those who loaded heavier — even when doing so risked violating weight limits.

“Internal driver averages were shared, and drivers below target were highlighted while those above target were praised,” the driver said.

He said he raised concerns with human resources but received no corrective response.

“I asked HR, how is it that drivers are being praised for loading over legal limits?” he said.

Brake warnings and productivity pressure

The Illinois-based driver said he also experienced pressure to keep operating trucks with unresolved safety warnings, including brake-system alerts.

“I got an ABS warning — ‘service now’ — after offloading diesel,” he said. “It was telling me to go to the shop.”

Instead, he said he was instructed to keep driving and let a different shift handle repairs.

“I told my lead there was an ABS issue, and he told me, ‘No, the night driver will take it later,’” he said.

The driver said waiting for guidance on safety concerns was itself treated as a performance problem.

“My lead is not a mechanic. He can’t decide what’s safe,” he said. “If there’s a brake issue, the truck has to go to the shop.”

He added, “Waiting for an answer about a safety issue also counted against my productivity.”

What drivers can do when conditions are unsafe

Federal and state laws provide truck drivers with protections when they refuse to operate unsafe equipment or report violations.

Drivers facing unsafe conditions are advised to:

  • Document everything, including dispatch messages, repair orders, photos and ELD records
  • Report safety concerns in writing, using internal safety channels
  • Refuse unsafe work, when operating the vehicle would violate safety laws
  • File a whistleblower complaint if retaliation occurs, particularly under the Surface Transportation Assistance Act (STAA) or applicable state laws

Truck Parking Club hits 4,000 locations, targets 10,000 by year-end

A semi-truck parked at a Truck Parking Club location in front of a building with a large yellow "TRUCKPARKINGCLUB.COM" sign, highlighting a reservable private truck parking space offered through the Chattanooga-based platform.

Truck Parking Club, the digital marketplace connecting commercial drivers with private parking spaces, announced it has reached 4,000 Property Member locations across 49 states, with plans to more than double that figure to 10,000 locations by the end of 2026.

The Chattanooga, Tenn.-based company added 1,000 locations in just three months and now offers over 66,000 instantly reservable truck parking spaces, addressing a national shortage of 1.7 million spaces that costs the trucking industry more than $100 billion annually.

Its rise is meteoric. The platform’s growth has attracted major carriers, with 92 of the top 100 U.S. carriers now using Truck Parking Club. The company was recently ranked No. 24 on the FreightWaves FreightTech 25 list for 2026.

To better understand the growth story, FreightWaves spoke with Reed Loustalot, chief marketing officer at Truck Parking Club.

Growing from 4,000 to over 10,000 locations would more than double the company’s footprint.

The math is straightforward, if daunting: add 6,000 new properties in roughly 11 months. That means recruiting thousands of individual business owners who have never considered parking semi-trucks as a revenue stream.

To accomplish this, Loustalot describes the recipe for success as extreme amounts of work and building a community and ecosystem to support it.

Beyond the milestone: A remarkable growth story

Loustalot doesn’t want the story to just be about hitting big round numbers. Reaching those numbers has taken Truck Parking Club on an odyssey in search of additional pavement to book.

Loustalot noted Truck Parking Club attended over 70 shows last year to expand reach and respond to feedback that the platform solves problems across the supply chain.

“That could be a storage company or a repair shop or a trucking company or a warehouse,” Loustalot said. Year to date, the company has already attended seven trade shows by early February.

Some of the biggest contributors are trucking companies with yard space, repair shops, self-storage facilities, towing companies and even third-party logistics providers with extra yard space. The variety of potential places to park translates into endless leads.

Truck Parking Club’s efforts have taken it to dozens of supply chain conventions, including self-storage shows, trucking conferences, towing shows and retailer conventions — anywhere a company with extra space might consider listing a spot.

“You’re going where they go,” Loustalot said. “And there’s a reason we do this.”

He described the strategy as a shotgun approach. “It’s a shotgun because it’s literally how wide our market is. And if we’re serious about adding 6,000 locations in 11 months, we have to cast as wide a net as possible while maintaining a high bar for quality and thoroughly vetting what we actually onboard to the app.”

There is a method to the madness, and it runs through the community the company has cultivated.

The right partners and the value of skin in the game

Behind the growth numbers lies a business model that Loustalot describes less as a tech platform and more as stewardship of small-business communities. When a driver books a spot through Truck Parking Club, the majority of every transaction goes directly to the property owner — whether that’s a family-owned repair shop in Akron, Ohio, or a regional trucking company with extra pavement.

“When you park at Rick’s Repair Shop in Akron, Ohio, and you pay with Truck Parking Club, you’re paying Rick,” Loustalot said. “In a way, I think we really need to talk more about how we’re building essentially an ecosystem of all these local businesses and drivers and fleets, and they’re essentially transacting and meeting, and we’re kind of the stewards of that community.”

The company acts as gatekeeper: handling onboarding, customer service and quality control. But the core is an ecosystem where hosts and drivers transact directly, with built-in incentives to keep standards high.

Drawing a comparison to ride-sharing platforms, Loustalot explained how accountability drives quality. The company has accumulated many tens of thousands of reviews across its properties and plans to make ratings affect visibility to drivers.

“It’s like Uber,” Loustalot explained. “A good rating keeps quality high because hosts know they need to deliver a great experience to stay visible. Drivers review seriously because they know the next person relies on that information.”

Unlike government-funded parking projects that may lack long-term maintenance incentives, property owners on the platform have financial motivation to keep their lots in good condition. If they want to continue earning revenue, they need to maintain positive reviews and provide reliable service.

“The only way we provide an excellent experience at that volume is by creating a system where properties are incentivized to improve based on feedback,” Loustalot said.

“Bar none, our aim is to provide drivers an excellent experience,” he added. “They know they’re going to have a spot, they can rely on it, they know they can trust the listing page, they know they can trust the photos, they know they can trust the reviews.”

Winning over both drivers and their fleets

Loustalot noted one recent trend is the nation’s largest trucking fleets warming to the idea of paying for driver parking.

“Not many do it yet,” Loustalot admitted, “but more will. We’re removing the traditional reasons they said no.”

For large fleets that are onboarded, Truck Parking Club’s biggest champions are often the drivers themselves.

Company drivers regularly tell Truck Parking Club that they pay for parking themselves to avoid trading $10 for an extra 50 or more miles of productivity. Parking peace of mind translates into more miles and a larger paycheck.

The company is working to convert more fleets into paying for their drivers’ parking, addressing traditional barriers.

“If historically what it’s meant for a big fleet to pay for a driver’s parking is either you just blindly trust the random receipt that your driver gave you or you don’t, and then go through the work of building the infrastructure to reimburse that money on paychecks,” Loustalot said. “We remove all of that because a fleet with us has one source of truth for payments and receipts.”

Fleet managers can track every location, payment and booking frequency. They can view photos, security features and available amenities for each location their drivers use.

It can also be a cash-generating option for fleets with a large real estate footprint. Many large carriers own or lease yards with underutilized space. The platform allows them to monetize that excess capacity while providing solutions where they need additional storage.

“I don’t care if it’s five trailers or 500 trailers,” Loustalot said. “I don’t care if it’s one location or 100 locations. We’ve done it all.”

The business case for fleet-paid parking extends beyond driver retention. Safety concerns play a role, as drivers parking in unauthorized locations create liability. Asset utilization matters too. When drivers shut down four hours early because they’re uncertain about finding parking, both the company and driver lose money.

Loustalot adds that for smaller fleets that can’t afford real estate, temporary or long-term parking can help them grow their business.

“We’ve had carriers tell us they have customers asking them to do projects in Ohio, and the carrier says no because they don’t have a yard there,” Loustalot said. “We can literally, on a month-to-month basis, give them access to flexible storage space.”

This flexibility allows carriers to take on new business without committing to multi-year leases.

Enhancing driver flexibility and the Super Trucker Membership

The flexibility theme extends to drivers as well. The company recently launched its first membership subscription, called the Super Trucker Membership, priced at $9.99 per month.

Members receive 5% back on every booking compared to the standard 1% return for non-members. The rewards accumulate in what the company calls “Club Cash,” a wallet feature tied to user accounts.

The membership also provides five free refunds and five free booking changes per month. Previously, all bookings were non-refundable due to the payment system structure. Now members can cancel and receive their money back in Club Cash for future bookings or move a reservation to a different date, all through the app without calling customer service.

“This is ultimately all about providing flexibility, because that’s how drivers are most affected,” Loustalot said. “They have flexible options, they have limitless places to park, and they always know they’re going to have a spot. That’s the world we’re trying to create.”

The platform serves diverse use cases beyond standard overnight parking. Drivers use the service for storing trucks near their homes, taking 34-hour resets near attractions and parking during vacation time.

“We hear stories like using a spot for five days so we could go to the Macy’s Thanksgiving Day Parade,” Loustalot said. “We’ve got a bobtail location on the beach in Florida, and there’s people there all the time. You think they’re just hanging out in the truck? No, they’re going to the beach.”

Looking ahead: Locations as service nodes

Loustalot doesn’t shy away from ambitious predictions about Truck Parking Club’s trajectory. Within three years, he expects the company to become the largest single entity parking trucks in the United States — handling millions of bookings annually.

“That is where we will be in not a very long time,” Loustalot said. “And if it takes three years, it takes three years. That’s not a long time.”

The long-term vision extends beyond parking reservations. Loustalot describes each location as a “node” around which useful services for truckers can aggregate: food, repairs, potentially even electric vehicle charging — whatever the market demands.

“Every single one of our locations is its own little node,” Loustalot said. “And the services that are useful to truckers will aggregate around the nodes. Food, repairs, charging, whatever services the market demands will appear.”

The company has already seen some electric vehicle charging companies list spaces on the platform — not for charging yet, but because they have unused space while infrastructure is built out. Formal partnerships remain on the horizon.

“Any one of those folks is welcome to work with us right now,” Loustalot said. “As time goes on, we’ll pay attention to what there’s demand for, and how it would work, and how it would improve the experience drivers would have with us, and we’ll evaluate it.”

The ultimate goal, Loustalot said, is a world where drivers have unlimited, reliable options — where the anxiety of finding a spot disappears entirely.

“That’s the world we’re trying to create,” he said. “Drivers have flexible options. They have limitless places to park, and they always know they’re going to have a spot.”

Freight market tightens in Q4 despite subdued volumes, U.S. Bank data shows

Line of semi-trucks on a U.S. interstate highway, illustrating tightening freight market capacity and rising truckload rates in Q4 2025 according to U.S. Bank Freight Payment Index data

U.S. Bank released its Freight Payment Index on Tuesday, showing that the fourth-quarter freight market saw a slight increase in shipment levels while capacity continued to contract. The capacity contraction pushed shipper spending to its highest level since early 2024, even as freight volumes remained historically low.

For shippers accustomed to a buyer’s market, the data suggests the window may be closing.

The U.S. Bank National Shipments Index posted a modest 1.5% sequential increase from the third quarter but declined 4.9% compared with the same period in 2024. Meanwhile, the National Spend Index surged 4.6% quarter over quarter and rose 5.2% year over year — the first annual spending increase in three years.

One sign of continuing capacity tightening is the widening gap between spending and shipments. This indicates shippers faced substantially higher costs to move only marginally greater volumes of freight.

Capacity squeeze driven by exits and enforcement

Several factors contributed to the capacity crunch in the fourth quarter. Prolonged market downturns prompted carriers to downsize fleets and reduce the number of independent contractors.

The total number of carriers operating also decreased throughout the year. Stricter government regulations added pressure, with tougher English Language Proficiency standards removing thousands of drivers from service.

The Department of Transportation temporarily paused the issuance of non-domiciled commercial driver’s licenses (CDLs) to certain non-citizens and non-permanent residents. The rule potentially affects nearly 194,000 CDL holders, though a court case has suspended its implementation for now. The regulatory environment remains uncertain.

Economic data offered little support for demand recovery. Manufacturing output showed no month-over-month growth for four consecutive months, and the ISM Manufacturing Index reached its lowest level since October 2024 in December. Retail sales through October were flat month over month and rose only minimally above inflation over the past year.

Consumer activity also played a part in dampening demand. Federal Reserve Beige Book reports indicated cautious discretionary spending among middle- and lower-income households, while higher-income groups generally maintained their spending habits, partially offsetting weakness in other segments.

Spot and contract rates climb as fuel costs fall

Rate data from DAT Freight & Analytics confirmed the capacity-driven pricing environment. Spot market rates — typically a leading indicator for contract rates — rose an average of 10 cents per mile, a 4.8% increase over the third quarter. Year over year, spot rates gained 5.1%, substantially higher than the 1.4% annual gain in the third quarter.

Contract rates posted 1.4% sequential growth for the second consecutive quarter, with year-over-year increases of 2.9% compared with the fourth quarter of 2024.

Fuel costs did not drive the higher spending. Average fuel expenditures declined 2.9% from the third quarter, dropping 1 cent per mile. The national average price for on-highway diesel fuel was 5.2 cents per gallon lower than the previous quarter. This leaves capacity constraints as the primary driver of elevated costs.

Regional performance mixed

Regional data showed inconsistent recovery patterns.

The Northeast emerged as the top performer, with both quarterly and annual increases in shipments and spending. The Northeast Regional Shipments Index rose 4.2% from the third quarter and 12.1% year over year, while spending increased 5.5% quarter over quarter and 16.7% year over year.

Modest manufacturing improvement in New York state and New England, combined with resilient spending from higher-income households, helped offset reduced spending by lower- and middle-income consumers.

The Southwest faced the greatest challenges, with shipments down 25.4% year over year despite a 5.4% quarterly rebound. The annual shipment average fell 31.6% compared with 2024 — the steepest decline among the five regions.

Despite softer volumes, shipping costs surged due to tighter capacity, likely influenced by stricter English Language Proficiency requirements for drivers. Cross-border movement dipped 0.8% from the quarterly average, and inbound truck traffic from Mexico declined 1.3% compared with October and November 2024 figures. The Federal Reserve Bank of Dallas reported falling retail sales early in the quarter.

The West recorded a slight 1.3% quarterly shipment decline but ended the year 5.4% higher than 2024. The annual average rose 3.2% — notable given declines of more than 16% in both 2023 and 2024. Tariff-related trade policy changes in 2025 boosted import volumes.

Early reports indicated slight dips in seaport and land port volumes from the third quarter. The Port of Los Angeles cited trade policy uncertainty for lower volumes in November and only a minor year-over-year increase in October. Land port truck traffic in October and November was 2.9% below the third-quarter average.

The Midwest posted a 3.5% quarterly shipment increase but remained 3.3% below the prior year — the least severe year-over-year decline among 2025 quarters.

Manufacturing signals were mixed, with the Federal Reserve Bank of Cleveland reporting a minor decline in demand for manufactured goods early in the quarter, while the Federal Reserve Bank of Chicago noted modest improvement in construction, manufacturing and consumer spending.

Besides the West, the Southeast was the only region with consecutive quarterly shipment declines, down 2.4% in the fourth quarter for a two-quarter total drop of 4.4%.

A federal government shutdown likely affected northern parts of the region, where many government employees reduced spending. The Federal Reserve noted declining consumer confidence in the quarter’s first six weeks, reduced new manufacturing orders amid tariff uncertainty, and more cautious discretionary spending from middle- and lower-income households.

Year over year, Southeast shipments dropped 5.9% — the second-largest decline behind the Southwest. Spending rose just 0.7% quarter over quarter (the smallest gain among regions) and 2.3% for the second half of the year (also the lowest).

Outlook points to tighter capacity

The fourth-quarter data confirms a gradual shift toward a moderately tighter market. Capacity contraction drove rates higher despite sluggish demand. For 2025 overall, the index fell 9.9% from the 2024 average — less than half the 20.4% decline seen in 2024. Freight volumes appear to have stabilized near their lowest levels, positioning the market for potential recovery if broader demand strengthens.

First look: Tough market for brokers evident in RXO 4Q earnings

RXO management in its third quarter earnings call, several weeks after the fourth quarter already had begun, said things were not going the way the brokerage would have desired. Several key numbers in RXO’s fourth quarter earnings released Friday morning backed that up.

Various numbers showed just how tough the quarter was for RXO, the latest data in line with challenging results reported by standalone brokers and the brokerages within trucking companies. Those various results show what happens when the freight market suddenly gets stronger, as it did in the last four to five weeks of the quarter, and 3PLs face the reality of filling earlier booked capacity with higher-priced truckload rates.

Adjusted EBITDA for RXO (NYSE: RXO) in the quarter was $17 million. That was down from  $32 million in the third quarter but also was down from $42 million in the fourth quarter of 2024. The adjusted EBITDA margin in the third quarter was 2.3%; in the fourth quarter, it dropped to 1.2%. A year ago, the EBITDA margin was 2.5%.

The outlook isn’t much better. RXO said it expects its first quarter adjusted EBITDA will be between $5 million and $12 million, which would be a downturn from the fourth quarter. It would also be far less than the $22 million in the first quarter of 2025.

1Q Brokerage volume to drop

RXO said its Brokerage volume in the first quarter would be down 5% to 10% from a year earlier.

“In the fourth quarter, tightening in the freight market accelerated, driven by continued reductions in truckload capacity,” CEO Drew Wilkerson said in a prepared statement released by RXO with its earnings. “This impacted our buy rates and squeezed our Brokerage gross margin.”

The squeeze was clear in looking at sequential data on revenue versus the cost of transportation. In the third quarter, RXO had revenue of $1.42 billion and transportation costs of $1.14 billion. In the fourth quarter revenue rose to $1.47 billion, up 3.5% but RXO also saw a 5.2% gain in the cost of transportation to $1.2 billion. 

The bottom line GAAP net loss was $46 million in the fourth quarter. That was more than a $25 million GAAP net loss in the fourth quarter of 2024, and $14 million in the third quarter.

It wasn’t just a squeeze in margins that affected RXO. It also reported a decline of 4% year-on-year in brokerage volume. The positive side in that number is that LTL volume was up 31% from a year ago, but truckload brokerage declined 12%.

The brokerage margin at RXO also showed weakness in the fourth quarter, coming in at 11.9%. Sequentially, that was down from 13.5% in the third quarter and 13.2% a year ago. 

Weaker gross margin in 1Q

RXO sees a downturn in its gross margin, predicting a first quarter gross margin of between  11% and 13%. The gross margin in the fourth quarter was 14.8%, compared to 15.5% in the fourth quarter of 2024.

With that sort of financial performance, it was no surprise that RXO, in announcing its earnings, tried to play up various positive data. The company said its Managed Transportation unit in the quarter was awarded more than $200 million of freight under management, which allowed an “increase (in) the synergy loads provided to Brokerage.”

 But even with that optimistic outlook , Managed Transportation revenue declined to $133 million from $141 million a year ago. That was down sequentially from $137 million. 

RXO also used the opportunity to disclose it had replaced a $600 million unsecured revolving credit facility with a $450 million asset-based revolving credit facility. The transaction was completed at some point in the first quarter.

More articles by John Kingston

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FMC fines MSC millions for Shipping Act violations

The Federal Maritime Commission said it has fined Mediterranean Shipping Company $22.67 million for three types of Shipping Act violations.

The decision followed an enforcement proceeding for three types of Shipping Act violations by the Swiss-based carrier. The Commission’s Bureau of Enforcement, Investigations, and Compliance (BEIC), through its Offices of Investigation and Enforcement, investigated and prosecuted.

The Shipping Act of 1984 requires ocean carriers to file agreements with the FMC covering  rate discussions and service contracts, and bars unfair practices such as excessive rebates or discriminatory rates.

Published estimates peg privately-held MSC’s revenue at $38.4 billion in 2025. 

The probe alleged that MSC violated the Shipping Act over the course of several years. The first, which occurred from 2018-2020, related to MSC’s billing of customs agents for demurrage and detention charges, or late fees, even though the agents were not involved in moving the cargo. The FMC affirmed an earlier decision of an Administrative Law Judge. The civil penalties for these violations totaled $65,000.

The investigation also affirmed an ALJ finding that MSC failed to include in its published tariff from 2021-2023 late fees for non-operating reefers (NORs). The agency modified the initial decision to reflect knowing and willful violations starting only from the point of MSC’s March 2022 statement to the Commission that it would modify its tariff. The penalties for those violations totaled $9.46 million.

In the third instance BEIC alleged that MSC overcharged its customers demurrage and detention fees for use of said reefers. The Commission reversed the ALJ’s determination that MSC’s NORs “billing system” mistake did not violate a portion of the Act, but held that overcharges occurred in about 23% of all NOR bills during the entire year of 2021. 

“Therefore, the Commission concluded that MSC’s billing was not merely the result of a mistake but rather that it constituted an unreasonable practice within the meaning” of the Act. It assessed a penalty of $5,000 per violation, or a total of $13.145 million.

Find more articles by Stuart Chirls here.

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Amazon posts Q4 gains from fulfillment orders and faster last-mile delivery

Amazon beat reported mixed financial results in the fourth quarter on Thursday, with revenue surpassing Wall Street estimates, while earnings slightly missed projections

During Amazon’s earnings call, CEO Andy Jassy touted the e-commerce segment’s ability to deliver more essentials to more customers as key growth drivers during the fourth quarter.

“For the third year in a row, globally, in 2025, we achieved both our fastest-ever delivery speeds for Prime members, while also reducing our cost to serve,” Jassy said.

However, shares tumbled more than 8% in after hours trading on the company’s forecasted capital expenditures of about $200 billion for 2026, higher than expected.

The e-commerce and cloud services giant’s (Nasdaq: AMZN) net sales for during the quarter rose 14% year-over-year to $213.4 billion, exceeding estimates. Net income was $21.2 billion ($1.95 per diluted share), an increase from the previous year, although the $1.95 EPS missed analyst expectations.

In North America sales — the company’s largest e-commerce segment — increased 10% year-over-year to $127.1 billion. Operating income climbed to $25 billion, supported in part by improved fulfillment-network efficiency.

In the U.S., Prime members received more than 8 billion items the same or next day in 2025, up over 30% year over year, with groceries and everyday essentials accounting for roughly half of that volume. Same-day delivery remains Amazon’s fastest-growing delivery option, used by nearly 100 million U.S. customers last year.

“Our regionalization has improved local inventory placement, leading to faster delivery at lower costs,” Chief Financial Officer Brian Wachter said, adding that the company continues refining how inventory is positioned to reduce distance traveled and package handling across the network.”

Amazon said it expects first-quarter 2026 net sales of $173.5 billion to $178.5 billion, representing 11% to 15% year-over-year growth, including a roughly 180-basis-point benefit from foreign exchange. 

Operating income is forecast at $16.5 billion to $21.5 billion, compared with $18.4 billion a year earlier, reflecting about $1 billion in higher Amazon Leo-related costs as satellite operations scale, along with continued investment in quick-commerce offerings and more aggressive pricing in international stores.

Amazon said it plans to invest about $200 billion in capital expenditures across the company in 2026, a sharp increase from roughly $131 billion spent in 2025, underscoring its aggressive push to expand infrastructure capacity.

The bulk of that spending is expected to go toward data centers, fulfillment operations, delivery infrastructure and automation.

“We see strong demand for these services, and we continue to like the investments in this area,” Wachter said during the call. “I would add that, you know, if you look at the capital we’re spending and intend to spend this year, it’s predominantly in AWS, and some of it is for our core workloads, which are our non-AI workloads, because they’re growing at a faster rate than we anticipated. But most of it is in AI, and we just have a lot of growth and a lot of demand.”

AmazonQ4/2025Q4/2024Y/Y % Change
Net revenue$213.4B$187.8B14%
Operating income$25B$21.2B18%
North American sales$127.1B$115.6B10%
International sales$50.7B$43.4B11%
Adjusted earnings per share$1.95$1.864.8%

Key fourth-quarter financial metrics.

Nashville-based Quickway Transportation, affiliates file for Chapter 11 bankruptcy

Quickway Transportation and its affiliate entities, Quickway Logistics and Quickway Carriers, have each filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Middle District of Tennessee, according to court filings submitted in late January.

Quickway Transportation listed between $0 and $50,000 in estimated assets and liabilities and fewer than 50 creditors in its voluntary Chapter 11 petition, which was signed by Brian Hall, CEO of Paladin Capital Inc., the company’s parent operator.

Separate but similar Chapter 11 petitions were also filed by Quickway Logistics and Quickway Carriers on the same day.

The bankruptcy filings follow a previously disclosed operational wind-down. In a WARN notice filed with the Tennessee Department of Labor and Workforce Development, Quickway Transportation permanently shut down its facility in Murfreesboro, Tennessee, on June 15, resulting in layoffs for 45 employees.

Federal Motor Carrier Safety Administration records show Quickway Transportation remains listed as an active interstate carrier with 228 power units and 319 drivers as of Feb. 4, though the company reported more than 21.7 million miles driven in 2024.

Quickway Transportation is based in Brentwood about 11 miles south of downtown Nashville.

Affiliate Quickway Carriers, which operates 89 power units and 125 drivers, also remains listed as active in SAFER records 

The filings add Quickway to a growing list of trucking and logistics companies seeking court protection amid prolonged freight market weakness and ongoing cost pressure.

Quickway Transportation has faced scrutiny in the past over labor practices. In 2022, an NLRB administrative law judge ruled the company acted legally in shutting down a Kroger-served facility in Kentucky after a Teamsters union vote, though the decision criticized Quickway’s anti-union tactics and cited two executives for labor law violations, according to prior FreightWaves reporting.

This is a developing story that FreightWaves will continue to cover.

First look: Werner’s Q4 misses mark

a rearview of a Werner trailer on a highway

Werner Enterprises reported a cost-burdened fourth quarter that came in light of estimates even after adjusting for nonrecurring items.

Werner (NASDAQ: WERN) reported a fourth-quarter headline net loss of $27.8 million, or 46 cents per share, on Thursday after the market closed. However, the number included $44.2 million in restructuring and impairment charges, the bulk of which were noncash items. Excluding those charges and other one-off items, adjusted net income was $3.3 million, or 5 cents per share. Adjusted EPS was 5 cents below consensus and 3 cents lower year over year.

The company said it began restructuring its one-way truckload unit during the quarter to improve fleet utilization, remove unprofitable freight and return the segment to profitability.

Click for full report – “Werner Enterprises restructuring one-way fleet”

Table: Werner’s key performance indicators

Consolidated revenue of $738 million was 2% lower y/y and shy of a $761 million consensus estimate.

Total TL revenue was down 3% y/y to $513 million. The segment reported a 97.2% adjusted operating ratio (inverse of operating margin), which was 30 basis points worse y/y.

One-way average trucks in service were reduced by 10% y/y with revenue per truck per week up 2%, resulting in an 8% revenue decline. Miles per truck per week improved 2% but revenue per total mile was off slightly.

Click for full report – “Werner Enterprises restructuring one-way fleet”

Dedicated revenue increased 1% y/y as a 2% increase in average trucks was partially offset by a 1% decline in revenue per truck per week.

The company issued guidance calling for revenue per total mile in one-way to be flat to up 3% y/y in the first half of 2026. Revenue per truck per week in dedicated is expected to come in down 1% to up 2% y/y for full-year 2026.

Werner will host a call on Thursday at 5:00 p.m. EST to discuss fourth-quarter results.

More FreightWaves articles by Todd Maiden:

Foreign trucker CDL rule now under review at OMB

trucks following each other on the highway

WASHINGTON — The Trump administration’s effort to clamp down on the licensing of foreign-domiciled truck drivers has moved into its final stage of executive oversight.

“Restoring Integrity to the Issuance of Non-Domiciled CDLs,” an Interim Final Rule (IFR) published in September, is now officially “pending review” at the Office of Management and Budget (OMB).

The move means that the Federal Motor Carrier Safety Administration has finalized its response to thousands of comments filed in the wake of the rule’s issuance and is now seeking a final green light from the administration’s budget and policy experts.

OMB has a 90-day window to complete its review, though it can move faster for high-priority items. Once cleared, the rule returns to the FMCSA for formal publication in the Federal Register, which will trigger the official compliance countdown for states and motor carriers.

FMCSA’s IFR, which mandates strict immigration verification for non-resident CDL and Commercial Learner’s Permit holders and applicants, was placed in abeyance by a federal court in December to allow the agency to process over 8,000 public comments, ranging from support from truck industry lobbying groups to major pushback from certain states and law-abiding truckers asserting they’re safe to be on the road.

Under the new standards, states must verify and retain copies of foreign passports and Form I-94 for non-domiciled drivers, restricted to specific employment-based visa categories like H-2A and H-2B. FMCSA argues these steps are critical following several high-profile fatal crashes involving foreign drivers with non-domiciled credentials.

The Owner-Operator Independent Drivers Association, one of the strongest backers of the rule, argues that non-domiciled licenses have historically bypassed the rigorous vetting and English-proficiency standards required of U.S. citizens, which has “resulted in improperly licensed foreign drivers flooding U.S. highways.”

Law enforcement officials have also supported the crackdown, citing first-hand views of non-compliance and citing instances of individuals with valid CDLs but who lacked legal work authorization.

But organizations like the Sikh Coalition and various labor groups have warned that the IFR is stripping thousands of legally authorized workers of their livelihoods. Attorneys General from18 states and the District of Columbia have challenged the rule’s legality, arguing that FMCSA lacks data proving that non-domiciled status inherently correlates with lower highway safety, calling the rule “arbitrary and capricious.”

The American Trucking Associations, which generally supports FMCSA’s CDL enforcement efforts, recommended that a final rule include a transition period.

“Given FMCSA’s estimation that this rule will result in a significant number of CDL downgrades (roughly 194,000), it is important that drivers be provided reasonable time to notify their employers,” ATA stated, or, alternatively, “that FMCSA establish a mechanism to ensure motor carriers are promptly informed when a driver’s CDL has been downgraded.”

Click for more FreightWaves articles by John Gallagher.