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November 26 2018

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10 The Journal of Commerce | November 26 2018 Cover Story In Chicago, "truckers are start- ing to approach us with low rates, so something must have changed," Daniel Martin, vice president and co-founder of SNA Cargo, said early this month. "A few weeks ago we struggled to find any capacity out of the Chicago rail ramps and since last week, three truckers have already approached us telling us they have available capacity." Earlier this year, when dray capac - ity was very tight and rates shot up as much as 40 percent, "our truckers started to invest in new equipment and started to pay their drivers more, so this could be a result of their efforts (in terms of attracting more drivers and having more equipment)," the freight forwarding and logistics executive told The Journal of Commerce. The new capacity coming online in certain markets at certain times, whether drayage or truckload, most likely reflects higher driver pay and new equipment, as well as changes made to transportation networks by carriers and shippers to adjust to the ELD mandate, which sucked up time and truck capacity just as freight demand surged in the first half of 2018. "Now it's absolutely easier to get 30-day payment terms, where some months ago everybody wanted pre- pay," he said. "It's a huge change. We US SHIPPERS MOVING cargo before the winter holidays may get some surprise capacity in their stockings, but the capacity openings aren't a sign of economic weakness, nor are they an excuse for shippers to let down their guard. The changes across the US transpor- tation landscape, from a trade war with China to seemingly unstoppable e-commerce growth, require from logistics managers a drill-like precision and agility, and closer collaboration with carriers. They're a sign of more complex peak season in a rapidly evolving trans- portation market limited by regulation such as the electronic logging device (ELD) mandate and pressured by the time-sensitive fulfillment demands of e-commerce, penalties charged by big box retailers for missed deliveries, and the need to import large amounts of goods ahead of waves of US tariffs. If you're in the right place at the right time, capacity suddenly may be available. It may not last for long, however, or be available elsewhere at the same price. That's a sign of how re- gionalized and complex transportation markets that blend asset and non-asset carriers, intermodal rail and drayage, air and ocean, truckload and less-than- truckload freight have become in 2018. The bumpy final mile New peak season landscape tests US shippers By William B. Cassidy

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