Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.
How far are U.S. trucking companies willing to go to recruit qualified drivers? How about Central Europe?
Two asset-based truckers, one a large well-known brand and the other a smaller lesser-known firm, have begun to
explore the potential of importing drivers from countries in the region to operate their rigs, according to C. Thomas
Barnes, president of Con-Way Multimodal, a freight broker and third-party logistics provider that spends about $2.4 billion
a year across multiple transport modes. Barnes said he's had a "strategic dialogue" with top managements at both truckers,
neither of whom he would identify. Nothing formal has been planned, he said.
Barnes said trucking companies will increasingly look outside traditional channels to recruit drivers amidst a
shortage that appears to be becoming more pronounced. "Most asset-based transportation companies are looking for a new
angle or process that will give them a competitive advantage in the increasingly difficult driver recruiting space," he
said in an email. "This is an example of a different approach that has been talked about [in concept] by several companies."
Such thinking underscores how creative—or desperate—managements have become to put people in the cabs. For
several years, there have been concerns about driver shortages, but no one saw it in widespread form. Now, however, it is
starting to fully materialize, if comments and anecdotes from trucking executives and analysts are any indication. "The
market for driver recruiting and retention was tighter than I've ever seen it in the first two months of the year," Darren
Hawkins, president of YRC Freight, the long-haul unit of less-than-truckload (LTL) carrier YRC Worldwide Inc., said this
week at the NASSTRAC annual conference in Orlando. As a 20-year industry veteran, Hawkins has lived through various periods
of driver tightness.
The problem, which was thought to be confined to truckload carriers whose drivers could be away for weeks at a time, is
spreading to almost every corner of trucking, according to John G. Larkin, transport analyst for investment firm Stifel,
Nicolaus & Co. "LTL, dedicated, drayage, private fleets: They're all crying for help," Larkin said at the same conference.
Larkin said driver pay isn't the obstacle, noting that even carriers who pay drivers more than $70,000 a year, generally
much more than the typical truckload carrier pulls in, are struggling to find labor. Even driving schools are having trouble
meeting sign-up targets
despite offering students and graduates bona fide job opportunities and making it easier than ever to
repay loans. The problem is the "societal blackballing of the profession" that has made an unglamorous but critical and
skilled trade undesirable to those looking for work, he said.
According to the American Trucking Associations, the trucking industry will require, on a net basis, 96,178 new commercial
drivers per year over the next 10 years. That's after deaths, retirements, and departures of all kinds are factored in. The
demographics are not favorable: The average U.S. truck driver is male, in his mid-50s, weights about 250 pounds and has a life
span about 10 years shorter than the same person that's not in the field, according to Larkin.
Jack Holmes, president of UPS Freight, the LTL unit of Atlanta-based UPS Inc., said he hasn't had trouble finding and keeping
drivers, noting UPS' relatively generous pay and benefits as well as the appeal of the LTL segment where drivers are generally
better paid and drive shorter hauls, which gets them home more frequently. Still, Holmes notes that more folks are leaving the
field for a variety of reasons than those entering it.
The situation is worsening as demand picks up—albeit moderately—and capacity continues to shrink in part because
of the lack of qualified drivers, Holmes said. The days of 2006 when there was abundant supply will be turned on their head, he
said. Without some form of capacity relief, such as changes in federal law allowing nationwide use of 33-foot double-trailers
instead of 28-foot doubles, "it's going to come to a bad end."
Warmer weather is providing some temporary pause. A 16-percent increase in available trucks on the spot market for the week
ending April 12 helped restore some balance to the load-to-truck ratio, according to data released today by consulting company DAT. As a result, spot market rates dipped significantly from last week's levels. Per-mile dry van rates
out of Chicago dropped 18 cents, according to DAT data. Rates out of Columbus, Ohio, a key mid-nation truck market, dropped 8
cents, while rates out of Houston fell 10 cents.
But no one believes the market will flip with the bloom of daffodils. Mother Nature only piled on to secular problems that are constraining supply. Besides a shortage of drivers, there are equipment, wage, and fuel inflation and new
government directives that have curbed productivity. The result is narrowing profit margins that make an already-demanding job
that much harder. The burden is especially onerous on the nation's owner-operators, who account for about two-thirds of the
nation's truck fleet. If the fleet backbone shrivels, so will the supply chain.
Eric McGee, senior vice president of transportation for Lowell, Ark.-based J.B. Hunt Transportation Services Inc., said the
supply-demand scale is somewhat balanced at this time. However, that balance is so tenuous that it will only take one
disruption—such as labor strife on the West Coast waterfront as management and ship labor try to make a June
30 deadline for reaching a new contract—to return to the ultra-tight conditions of February and March, he said.
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Serious inland flooding and widespread power outages are likely to sweep across Florida and other Southeast states in coming days with the arrival of Hurricane Helene, which is now predicted to make landfall Thursday evening along Florida’s northwest coast as a major hurricane, according to the National Oceanic and Atmospheric Administration (NOAA).
While the most catastrophic landfall impact is expected in the sparsely-population Big Bend area of Florida, it’s not only sea-front cities that are at risk. Since Helene is an “unusually large storm,” its flooding, rainfall, and high winds won’t be limited only to the Gulf Coast, but are expected to travel hundreds of miles inland, the weather service said. Heavy rainfall is expected to begin in the region even before the storm comes ashore, and the wet conditions will continue to move northward into the southern Appalachians region through Friday, dumping storm total rainfall amounts of up to 18 inches. Specifically, the major flood risk includes the urban areas around Tallahassee, metro Atlanta, and western North Carolina.
In addition to its human toll, the storm could exert serious business impacts, according to the supply chain mapping and monitoring firm Resilinc. Those will be largely triggered by significant flooding, which could halt oil operations, force mandatory evacuations, restrict ports, and disrupt air traffic.
While the storm’s track is currently forecast to miss the critical ports of Miami and New Orleans, it could still hurt operations throughout the Southeast agricultural belt, which produces products like soybeans, cotton, peanuts, corn, and tobacco, according to Everstream Analytics.
That widespread footprint could also hinder supply chain and logistics flows along stretches of interstate highways I-10 and I-75 and on regional rail lines operated by Norfolk Southern and CSX. And Hurricane Helene could also likely impact business operations by unleashing power outages, deep flooding, and wind damage in northern Florida portions of Georgia, Everstream Analytics said.
Before the storm had even touched Florida soil, recovery efforts were already being launched by humanitarian aid group the American Logistics Aid Network (ALAN). In a statement on Wednesday, the group said it is urging residents in the storm's path across the Southeast to heed evacuation notices and safety advisories, and reminding members of the logistics community that their post-storm help could be needed soon. The group will continue to update its Disaster Micro-Site with Hurricane Helene resources and with requests for donated logistics assistance, most of which will start arriving within 24 to 72 hours after the storm’s initial landfall, ALAN said.