2013’s Top 10 News Stories The news that shaped the year in logistics and transportation
December 01, 2013
New Hours-of-Service (HOS) rules affecting truckload market
The long-dreaded new components of motor carrier HOS regulations took effect on July 1, and the reception from the shipper and carrier communities has been largely negative. Changes to the 34-hour restart provision have been the biggest culprit, with industry estimates pinning the loss of carrier productivity from the HOS rule changes from 2 percent to 10 percent.
Still a long road ahead for YRC
Despite some previous signs of progress, LTL carrier YRC Worldwide still faces an uphill challenge as it tries to get back into the black and meet pending debt obligations to its lenders in early 2014. On top of that, its network optimization plan for its largest group, YRC Freight, had a bumpy beginning, which led to tonnage, earnings, and volume declines in the third quarter.
Labor peace arrives for East and Gulf Coast ports
The United States Maritime Alliance (USMX), a group of container carriers, direct employers, and port associations serving U.S.-based East and Gulf Coasts, and the International Longshoremen’s Association (ILA), the largest union of maritime workers in North America, finally arrived to a state of labor peace in April. ILA membership signed off on a six-year Master Contract that covers roughly 14,500 members in a ratification vote held at East and Gulf Coast member ports.
Trucking M&A activity starting to heat up
The second half of the year brought increased activity in trucking deals, with some closed and pending deals in the news. The largest potential merger would be Phoenix-based Knight Transportation’s proposed $242 million takeover, including debt assumption, of financially ailing USA Truck.
UPS-TNT deal fails to come to fruition
The planned acquisition of Netherlands-based TNT Express by UPS was officially called off in January. This decision by UPS followed a decision from the European Commission (EC), the executive body of the European Union, which prohibited the acquisition. UPS said that as a result of the prohibition by the EC, the deal would not be completed and UPS and TNT entered into a separate agreement to terminate the merger protocol.
USPS losses continue to mount
While its Shipping Services group continues to make positive inroads, the United States Postal Service (USPS) still has a way to go to turn a profit. For the 2013 fiscal year, the USPS incurred a $5 billion net loss and continues to feel the impact of the decline of First Class mail volumes and its federally-mandated payments prefunding health retiree benefits.
LNG making inroads in freight transportation
As diesel prices saw ongoing weekly declines through much of the second half of the year, liquefied natural gas (LNG) deployment and testing continues to increase in both the trucking and railroad sectors. Industry experts say that with natural gas prices low, LNG usage could be a long-term benefit, but upfront costs are a factor, too.
Water Resources Development Act has strong potential
The chances of a new water resources bill being passed for the first time since 2007 are strong, with the House and Senate both signing off on the Water Resources Development Act by wide margins. This bill would allocate increased resources for the Harbor Maintenance Trust (HMT) Fund that is comprised of revenues collected annually from importers and domestic shippers for deep-draft navigation maintenance dredging and the operation and maintenance of large and small ports.
E-commerce continues to change complexion of supply chain
The ongoing emergence of consumers shopping online is having a major impact on supply chain and logistics processes in the form of changing delivery patterns and schedules, with a focus on next- or same-day delivery and where to set up warehouses and distribution centers.
Intermodal continues to roll
Increasing intermodal usage by shippers was reflected in data from the Association of American Railroads (AAR). The AAR said August marked the single best-ever monthly performance for the mode at 1,031,179 containers and trailers.
Subscribe to Logistics Management magazine
entire logistics operation. Start your FREE subscription today!