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May 12, 2014

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SURFACE & DOMESTIC TRANSPORTATION 64 THE JOURNAL OF COMMERCE www.joc.com MAY 12.2014 By Mark Szakonyi BIG DATA TO THE RESCUE New analysis of electronic data offers trucking companies and shippers valuable information to improve efficiency BIG DATA, the explosion of electronic infor- mation that can be analyzed, isn't only a buzzword thrown around by the likes of IBM and Facebook. It's also a means to boost truck utilization as capacity tightens. Atlanta-based technology and data ana- lytics company First Advantage, for example, uses information collected by trucking com- pany customers to target when trucks aren't being operated efficiently and which drivers are running afoul of regulations, said Dan Filby, executive vice president and manag- ing director. In one case, First Advantage showed a motor carrier that some of its trucks were idling unnecessarily after nighttime loadings in Nebraska, Filby told the NAFTANEXT conference in Chicago last month. The trucking company "would never have been able to isolate or identify those opportunities without (data sets to) drill down into quickly," Filby said. First Advantage also has helped truck- ing company customers target which trucks aren't being utilized well, giving carriers an opportunity to sell the assets or shift them to an area where they would be more pro- ductive. Because the company tracks the seven metrics used by federal regulators in the Compliance, Safety, Accountability pro- gram, it can let carriers know which drivers are close to hitting the point at which they THE HARSHEST WINTER in years is over, but the tight capacity it produced is likely to linger, squeezing truckload shippers and hitting them right where it matters most: in the pocket. That's one of the takeaways from first quarter earnings reports from some of the largest truckload carriers, including Swift Transportation, which expects rates to rise as the year progresses. Swift Transportation increased its revenue per loaded mile 3 percent in the first quarter as truck pricing rose and the company was paid for repositioning trucks. "We believe the capacity availability concerns expressed by shippers are likely to materialize into more than the previously anticipated range of 2 to 3 percent," Swift President Richard Stocking said during a first quarter earnings conference call with investment analysts. The nation's third-largest truckload carrier, Werner Enterprises, said the first quarter was the strongest for freight demand in 10 years, despite — and to an extent because of — severe cold and succes- sive storms. The early timing of the 2014 Chinese New Year and lean retail inventories con- tributed to the surge in demand, as did w eather-related backlogs and intermodal rail service problems. Truck capacity also tightened because of trucking company failures and an "extremely challenging" truck driver mar- ket, the Omaha, Nebraska-based company said. A "meaningful improvement" in winter freight demand is pushing truckload rates higher this spring, as shippers look to lock down truck capacity for the fall peak ship- ping season. Following widespread U.S. supply chain disruptions and equipment short- ages last winter, many trucking analysts a nd executives expect truckload rates to rise at least 4 percent on average in 2014, with rates in some lanes going much higher. "We are in the process of negotiating rate increases with many customers during the traditionally substantial spring bid sea- son," Werner said last month. Werner expects demand to continue to rise. "We are seeing a meaningful improve- ment in our freight demand, which we believe is a longer-term shift in market dynamics," the company said. "We're seeing individual increases for small to midsize companies of 10 to 20 per- cent," said Mike Regan, chief of relationship development at TranzAct Technologies, a freight payment firm handling billing for thousands of shippers. JOC Contact William B. Cassidy at wcassidy@joc.com and follow him on Twitter: @wbcassidy _joc. By William B. Cassidy RATES TRUCKIN' HIGHER Truckload carriers say the first quarter's tight capacity isn't likely to ease anytime soon "We are seeing a meaningful improvement in our freight demand."

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