Recon Logistics - Freight Advisors

Recon Market Update - February 17, 2022

Posted by Hank Newman on Feb 17, 2022 8:23:50 AM
"Keep Rolling with the Punches," Diesel Crosses $4, and "Who Owns My LTL Carrier Now?"
I was asked to comment on the Freedom Convoy and its impact on trucking in general. Initially, I decided not to due to the fact I'd need to put some of my own opinions on it, which could lead to some unintended consequences. Many of you could guess where I'd go with that. Then I thought about how I would view all this if I were a smaller manufacturer dependent on my freight moving across the border. That's when I came up with the idea that I'd feel pretty much like a boxer in the 10th round of a brawl. It just keeps coming, doesn't it? From two weeks to slow the spread to two years of continued suppression, varying science interpretations, inflation roaring, the "great resignation," record freight rates, congested ports, diesel now at $4, etc., etc.!

I'd be livid that yet another disruption was at hand. But am I not used to it by now? Now put yourself in the shoes of a trucker. And I can only imagine what it's like in Canada. From Hero to Zero. Shippers haven't changed their behaviors much — truckers are still treated as second-class citizens, and all these Covid restrictions have made it worse. Yeah, I'd be ticked off if I were a trucker too! Truckers being the independent breed that they are, have had enough. Good!

Here are the facts on the ground, and they are getting worse with Canada now moving to freeze bank accounts and canceling insurance on participating truckers. Capacity, as tight as it has been, just gets tighter. US truckers don't want to go to Canada if they can help it, wondering if they will have to be quarantined (remember the ban at the border that went into effect recently?) and not allowed out. LTL carriers are reluctant to pick up cross-border freight due to the delays. Border crossing charges are likely to go up.

Everything just becomes more challenging. The same game we've been playing for two years now. Deal with it — your rates are higher, and it's more difficult to move products. Blame Canada — they've done a heck of a job making a bad situation worse — congrats! Maybe near-shoring should include Canada as well! Blame Recon — why not? We even had a supplier tell us last week our job is to guarantee trucks! Lol — so much for keeping my opinion to myself, but enough is enough. At least it appears enough was enough for the Super Bowl, right?

So who owns my LTL carrier? Dang — AAA Cooper bought by Knight-Swift, Midwest bought by Knight-Swift, Pilot Freight bought by Maersk, UPS bought by T-Force, and, of course, Central Freight Lines shuts down. It's a very interesting environment, and with so much capital looking to be deployed, you have to wonder what the LTL environment will look like 5-10 years down the road. A safe prediction? Rates are going up!  

Finding a truck continues to be really, really challenging! Plan ahead!


Tags: LTL, Freight Rates, LTL Carrier Cost, Logistics, LTL Service, Freight News, Freight Update

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