Commerce Express Weekly Road Map:
August 1st, 2023
Keeping you informed on the latest news/insights in our industry.
Commerce Express Blog
The branches of 2021’s Bipartisan Infrastructure Law (BIL) are extensive. Within the colossal $2.1 trillion package, billions of dollars’ worth of new infrastructure projects were outlined in the legislation.
Of course, having a war chest of this much funding unlocks unprecedented potential to improve the country’s roadways and infrastructure. This very responsibility has largely fallen onto the U.S. Department of Transportation.
Trucking Update
Yellow Corp. Has Shut Down Operations
As of noon on Sunday, Yellow Corp. has shut down operations, according to a notice on the gates at its terminals, multiple outlets report.
Yellow Corp. has been unable to come to an agreement over operational changes, after many months of negotiations with its Teamsters union.
Many expect Yellow Corp. to officially announce the file of bankruptcy in coming days.
Volvo Has Recalled 63,095 Trucks Due to Ineffective Wiper Motors
A recall on 63,095 trucks has been issued by Volvo Trucks North America, due to the windshield wiper motors wearing out prematurely, which can limit visibility in rainy conditions.
The reason for the safety recall was due to warranty claims reaching 5.8 percent. Roughly 6 percent of the recalled trucks – 2022-2024 VNR, VNL, VHD and VAH models – are expected to have this issue, per Freightwaves. Of the recalled trucks, 55,012 are in the U.S. and 8,083 are in Canada.
Additionally, Volvo will begin replacing the wiper motor assembly with units produced with verified components.
Teamsters Local Unions Vote in Overwhelming Support for the Tentative Contract
On Monday, Teamsters local unions (who represent the 340,000 full and part-time workers at UPS), voted 161-1 to endorse the tentative five-year agreement, and recommend to its members to pass it.
Now those union members will have the opportunity to vote on ratifying it between August 3rd and 22nd.
As Freightwaves reports, the tentative agreement includes sizable wage increases, installation of air conditioning in new vehicles, the end of a controversial two-tier wage system, catch-up raises for part-time employees, MLK Jr. Day as a paid holiday, and new language to prevent forced overtime on days off.
Did You Know: Prices for Diesel Have Increased
Benchmark diesel price has increased by 22.2 cents per gallon, totaling at $4.127 per gallon, according to the DOE and EIA.
This one week surge is one of the biggest ever seen by the Department of Energy/Energy Information Administration.
Rail Update
Rail Freight to the U.S. From Canada Continues to Drop After Port Strike
Rail freight from Canada to the U.S. has certainly been impacted from the Canadian port strike that occurred. While a tentative agreement has not been secured yet – that hasn’t stopped rail operations from being disgruntled.
Weekly rail traffic from Canada into the U.S. has continued to dropped. However, the first full week of the strike saw a 46 percent decrease in rail trade from Canada, data from the AAR shows, while the second week saw a 36 percent decrease.
When the strike first started, the Railway Association of Canada estimated it would take three to five days for every day the strike lasted for rail networks and supply chains to recover.
Those in the chemical industry have been especially impacted, and as CNBC reports, railroads move large amounts of anhydrous ammonia, potassium compounds, urea, plus millions of tons of raw materials that are used to produce fertilizer.
Where are things at with the Canada Tentative Labor Agreement?
The latest update, as of 7/31/2023: An announcement was reported by CNBC, of a new tentative agreement. The union caucus still has to vote on it and then if approved, will go to the members to vote on it. No specific details of the new agreement have been released.
This new tentative agreement comes after union members rejected the original tentative agreement last week. That previous agreement included the increase of compounded wage over 4 years by 19.2 percent, a signing bonus of about $3,000 per full-time worker, and an 18.5 percent increase in the retirement payout.
Additionally, Canadian National announced they are running additional trains in order to help speed up the process of clearing out the container congestion.
Weekly Rail Traffic for the Week Ending July 22nd, 2023
- Total U.S. weekly rail traffic was 473,736 carloads and intermodal units – down 3.2 percent compared to the same time last year, according to data from the AAR.
- U.S. weekly intermodal volume was 251,282 containers and trailers – down nearly 5 percent (4.8 officially), compared to the same time last year.
- Motor vehicles and parts, non-metallic minerals, and metallic ores and metals all posted increases. While grain, coal, and forest products all saw decreases.
- Additionally, North American rail volume for the first 29 weeks of this year were 18,690,310 carloads and intermodal units – which is down 4.2 compared to last year at this time.
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