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August 14 2023

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August 14, 2023 | Journal of Commerce 47 www.joc.com Surface Transportation quickly. Most experts believe there is enough capacity to handle Yel- low's freight, but they say costs to shippers will rise quickly. "Capacity in LTL isn't nearly what people think it is," said Regan. "Terminals are the big sticking point. There are fewer LTL termi- nals today than when Consolidated Freightways went out in 2002." With freight demand down from last year, shippers had been leaning on LTL providers for smaller rate hikes, if not outright rate cuts, said Satish Jindel, president of SJ Con- sulting Group. "All of that suddenly fl ips upside down," he said. "It will now be mid-single-digit to high- single-digit rate increases." JOC Journal of Commerce analyst Cathy Morrow Roberson contributed to this report. email: bill.cassidy@spglobal.com twitter: @willbcassidy carriers weeks ago, when Yellow warned it could run out of cash. "We expired their rates in our [transportation management sys- tem] and started fl ushing the pur- chase orders out of the system," said one e-commerce retailer that used Yellow for middle-mile shipments between warehouses and fulfi llment centers. Market prices are already rising, the shipper said. "We're not seeing increases from our other contract LTL carriers, but we did have a carrier we were negotiating with say they'd have to raise their rates from ones provided earlier in the bidding process," said the retailer, who did not want to be identifi ed. Price hikes are expected to pick up their pace. Remove a company the size of Yellow — the fi fth-largest LTL car- rier ranked by volume, according to SJ Consulting Group — and slack LTL capacity is likely to tighten LTL freight demand, while depressed compared with 2022, was still "solid" in the second quarter, Saia President and CEO Fritz Holgrefe said in a July 28 earnings call. "The pace of volume declines moderated each month as we moved through the quarter and have actually turned positive so far in July," he said. Some of the recent volume improvements at Saia may refl ect a shift of freight away from Yellow. Several large shippers that used Yellow told the Journal of Commerce they began switching to other LTL 11447 Start the conversation — Magazine — Events — Online — Multimedia — Lead Generation — Custom Content — Webcasts Deliver your brand messaging to our audience across platforms "If the market rebounds, it's going to make 2021–22 look like a walk in the park."

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