State of the Industry Report February 2023
Industry Insight from RXO Experts
Cross-Border Market Update
We are seeing an increase in domestic capacity thanks to a combination of factors including consumer demand, overflow inventory and nearshoring. Having a cross-border option to transload helps you find the most competitive rates. With increased demand for cross-dock rates and transloading options, RXO’s brand new facility in Laredo, TX can be integral to your border crossing operation.
Pedro Encinas
Director,
MX Customs Brokerage,
Laredo, TX
RXO Extra™ Launches With Expanded Carrier Rewards and Discounts
RXO Extra links loyal carriers to expanded suite of cost-saving partnerships in an online marketplace.
RXO Delivers Strong Fourth Quarter Driven by Brokerage Volume Growth
RXO Delivers Strong Fourth Quarter Driven by Brokerage Volume Growth Despite a challenging macro and muted peak season, RXO delivered strong results with EBITDA of $64mm, ahead of consensus expectations.
RXO in the news
To learn more about RXO and see our current news releases, please use the following link:
Top Industry News
Ohio Train Derailment Could Bring Cancer Risk, Millions in Damage
Weeks after a train carrying carcinogenic chemicals derailed in East Palestine, Ohio, the extent of the damage to the nearby community is still unclear. Railroads face a traffic backlog and operator Norfolk Southern Corp. could rack up tens of millions of dollars in costs.
Import Demand Continues to Fall
Lunar New Year normally brings a slow shipping period for imports, but the lead-in period was also lackluster. With many companies calling for a return to seasonal patterns later in the year, just how close are we to that being a reality?
US and Global Macroeconomics
ATA’s Bob Costello Presents Mixed Picture on Economy
TransportTopics: The U.S. economy is poised for a short and shallow recession during the second half of the year, but circumstances specific to current economic conditions — including high interest rates, persistent inflation and a cooling housing market — make predictions more challenging than usual, said American Trucking Associations chief economist Bob Costello.
Supply Chains Have Healed, Yet Their Mark on Inflation to Endure
TransportTopics: Supply chains across the world are healing up almost as fast as they broke down. That doesn’t mean the pressure they’re exerting on inflation will disappear as quickly.
Tesla, GM Among Carmakers Flocking to Mining Events Amid Battery Metals Scramble
SupplyChainBrain: Top automakers including Tesla, General Motors, and Ford are heading out on the mining conference circuit as soaring demand for metals used in electric vehicles ignites a scramble to lock in long-term supplies.
4th Consecutive Weekly Drop Posted for Benchmark Diesel Price
FreightWaves: DOE/EIA price down more than 32 cents a gallon in that time; some predict significant increases in Q4.
Cass: January Shipments Better than Expected; TL Takes Share from Other Modes
Cass says freight rates will be down 6% to 7% year-over-year in the next few months if seasonal patterns hold true.
Smart Solutions
Modes Overview
- Parcel Volumes to Remain 20% Above Pre-Pandemic Rate this Year. More from FreightWaves.
- Last-mile Companies Poised to Shake up the Market. More from FreightWaves.
- ‘Colossal’ Tidal Wave of New Container Ships about to Strike. More from FreightWaves.
- Air Cargo’s Lunar New Year Blues. More from Logistics Management.
- FRA to Issue Final Rule Affecting Railroad Contract Workers. More from FreightWaves.
- RXO Makes Dedicated Freight Accessible, Desirable for Shippers and Carriers. More from FreightWaves.
- Running on Ice: Cold Chain Demands Grow Stronger. More from FreightWaves.
Infrastructure and Regulation
One Year Later: How Ukraine-Russia War Reshaped Ocean Shipping
- Sizing up the war’s effect on container, crude, diesel, LNG and dry bulk shipping
- There have been a multitude of sanctions. Russia has indeed faced challenges importing and exporting. But cargo has continued to flow, like water drawn by gravity around a stone.
- Cargoes either take a longer route, or a replacement source steps in. Across all the major ocean shipping segments — containers, tankers, dry bulk, gas — the first year of the war has shaken up markets but hasn’t stopped trade.
Trade Groups, Unions Differ in Responses to NTSB Report on NS Derailment
Groups seem to be at odds on pace of next steps after Norfolk Southern derailment
Cross-border: Mexico, Canada and International
Nearshoring Creates Booming Demand for Border Logistics Facilities
Business is good at the Otay Mesa port of entry, California’s largest commercial land border crossing, which tallied $62.4 billion in trade in 2022, a 12.7% year-over-year (y/y) increase compared to 2021. The Otay Mesa port of entry is just south of San Diego along the border across from Tijuana, Mexico.
The growth of trade at Otay Mesa has been spurred by the nearshoring of manufacturing and supply chains from Asia into Mexico, which is creating a surge in demand for industrial space in cities and communities along the border, according to trade operators.
Canada Devotes Millions in Federal Funding to Train, Recruit New Truckers
Funds to help train, find jobs for up to 2,600 truck drivers, other industry positions
Technology
Cyber Insurance Is Back From the Brink After Onslaught of Ransomware Attacks
The cyber-insurance market, battered by a rash of pandemic-era ransomware attacks, is making a comeback. Price hikes are moderating, new carriers and fresh sources of capital are emerging, and companies can better afford coverage.
Chip Makers Turn Cutthroat in Fight for Share of Federal Money
In early January, a New York public relations firm sent an email warning about what it characterized as a threat to the federal government’s program to revitalize the U.S. semiconductor industry.
What to Expect in Network Connectivity for the Supply Chain in 2023
Recent news reports suggest that supply chain normalization might not be attainable in 2023. Plagued by compounding delays and perpetual labor shortages, the global supply chain is in a predicament that requires multiple solutions.
Initiatives – Safety
FMCSA Proposes Changes to Its Motor Carrier Safety Measurement System
The Federal Motor Carrier Safety Administration has announced it won’t adopt a complex data collection method recommended in 2017 by a special National Academy of Sciences academic panel to calculate safety scores for motor carriers.
However, the agency said in a notice that it will make changes to its motor carrier Safety Measurement System that will include using certain aspects of the complex data collection method known as the Item Response Theory.
