Logistics Market
Major Shifts on the Rails and Heavy Demand for Equipment
Schneider is making a major shift in how it moves intermodal freight across the eastern half of the country. Intermodal freight refers to shipping containers moved using a combination of trucks and rail. According to reporting by FreightWaves, Schneider is moving all of its eastern intermodal business from rail carrier CSX over to Norfolk Southern. Schneider aims to use the strategic partnership to open up growth opportunities, improve capacity flexibility, and move additional freight off the highway system onto rail lines.
If you are trying to lease dry van trailers right now, you are facing a tight equipment market. FreightWaves reports that trailer leasing demand has surged to record highs, with utilization rates pushing past levels seen during the pandemic peak. Craig Barth, Chief Financial Officer at Premier Trailer Leasing, told FreightWaves that supply-side constraints are fueling the surge. The tight supply is driving higher demand for older equipment and prompting warnings regarding fraudulent rental schemes as carriers hunt for available trailers.
Where is this underlying freight volume coming from in a mixed macro economy? Trucking Dive reports that Bob Costello, Chief Economist at the American Trucking Associations, identified consumer spending and a massive surge in data center construction as the primary engines keeping overall freight demand afloat. That big tech infrastructure push is expanding globally as well. FreightWaves reports that international logistics provider AIT Worldwide Logistics is buying Australian freight forwarder Connor Anderson International to broaden its footprint across Oceania and support tech buildouts in that region.
LTL Earnings Show Premium Push as Retailers Rework Supply Chains
In the less-than-truckload market, which combines freight from multiple shippers into single trailers, major carriers are reporting solid revenue growth. FreightWaves reports that Saia achieved record third-quarter revenue of 982.5 million dollars. Saia President and Chief Executive Officer Fritz Holgrefe attributed the record numbers to strategic network investments, better customer satisfaction ratings, and lower claims ratios for damaged or lost freight.
Trucking Dive reports that XPO saw its third-quarter revenue rise 12 percent. XPO Chairman and Chief Executive Officer Mario Harik stated that the carrier's deliberate strategy to grow higher-margin premium services is paying off, while the carrier tests new verticals including healthcare and grocery consolidation. Meanwhile, Trucking Dive notes that FedEx Freight focused heavily on customer retention during its initial four months operating as an independent company following its corporate spinoff, even as third-quarter shipment volumes experienced a slight dip.
Shippers are also changing how they source goods and track shipments to regain cost control. Supply Chain Dive reports that grocery retailer Kroger is expanding its direct sourcing operations to boost first-party procurement volume past 10 percent while building out an owned import and distribution system. In parcel shipping, Supply Chain Dive reports that UPS is pushing to double the volume of customer-applied radio frequency identification, or RFID, tags. UPS Chief Executive Officer Carol Tomé expects 6 million packages a day to carry RFID tags by 2027, giving shippers significantly better package tracking visibility across the carrier's network.
Cross-Border Friction, Tariffs, and Fuel Relief Measures
If your supply chain crosses North American borders, several policy and enforcement changes demand your attention. FreightWaves reports that stricter enforcement of cabotage laws is creating tension along the Mexican border. Cabotage regulations restrict foreign commercial drivers and fleets from hauling domestic point-to-point freight inside another country's borders. To support freight traffic while enforcement tightens, state officials in Nuevo León have slashed toll fees at the Colombia Bridge border crossing by 50 percent. Meanwhile, infrastructure investments continue along the border corridor; Supply Chain Dive and FreightWaves report that Walmart plans to break ground this February on a 400 million dollar distribution center in Cibolo, Texas, near San Antonio. The 744,000-square-foot facility is expected to create 425 jobs.
Trade policy friction is also mounting along the northern border. A FreightWaves SONAR report details an escalation in the US-Canada trade dispute. Following earlier tariff hikes, the United States executed an outright import ban on Canadian dairy products, alcohol, and large-displacement motorcycles.
Fuel costs remain another pressure point for carrier operating budgets. Land Line reports that federal agencies are attempting to ease fuel price spikes by encouraging states to grant temporary waivers for red-dyed diesel, an untaxed fuel product normally restricted to off-road equipment. Currently, 31 states have approved the red-dyed diesel waiver while 19 states have not. Land Line notes that despite multiple federal orders and proposals introduced to target fuel costs, tangible financial relief has yet to reach most truck operators.
Driver Enforcement, Equipment Recalls, and Market Rate Data
Highway enforcement and vehicle safety standards are seeing increased focus from regulatory bodies. Land Line reports that a joint law enforcement initiative between state and federal agencies recently resulted in nearly 200 commercial truck drivers being placed out of service for English-language proficiency violations. At the same time, driver groups want more operational control. Land Line reports that truck drivers are petitioning the Federal Motor Carrier Safety Administration for added flexibility inside hours-of-service rules, which set strict limits on daily driving and working hours.
On the legal side, Land Line reports that the Owner-Operator Independent Drivers Association is raising concerns about a new Delaware insurance law. The law lengthens the window of time individuals have to cancel certain injury settlements, which owner-operator groups warn could drive up carrier insurance premiums. Fleet managers should also check their equipment logs: Land Line reports that trailer manufacturers Great Dane and Wabash have issued safety recalls to address manufacturing defects that could cause trailers to drop or stop while operating on the road.
To help shippers evaluate these market shifts, new analytics tools are coming online. FreightWaves SONAR announced new routing guide and contract rate datasets that publish what shippers pay brokers and secondary carriers when primary contract carriers reject tenders. The system also tracks intermodal spot and contract pricing alongside conversion metrics to calculate exact truckload-to-intermodal savings.
What this means for your freight rates
The current market is characterized by targeted constraints rather than broad capacity shortages. Demand is holding steady thanks to consumer spending and data center construction, but operational friction points are adding cost. Trailer availability is tight, LTL carriers are maintaining pricing discipline on premium freight, and cross-border enforcement is slowing down border transfers.
When primary contract carriers reject tenders, routing guides fall to secondary options where spot or backup contract rates apply, quickly driving up your average cost per mile. You should take time this week to review your routing guide compliance and benchmark your active lanes using the free Logistics Market freight rate tool. Comparing your contract and spot rates against real-time market data will reveal where secondary tenders are eroding your margin and help you identify specific highway lanes that could be prime candidates for intermodal conversion.