7 Trending Transportation Updates: November 2016

  • Little Change in Economy, but Rate Increase Coming. Next year, the US economy won’t change much, growth expected to be about 2%. FTR predicts more of the same, but when you factor in low expectations, 2017 will feel like a good year. Shipping prices are expected to increase in 2017 and continue into 2018. FedEx, UPS and several LTL carriers have announced a series of rate increases effective in 2017.
  • Self-Created Holiday has Vigorous Delivery Window. Singles Day is the largest shopping day in the world, 4x bigger than Black Friday. Alibaba was expected to generate $20 billion in total transaction value. Last year, Alibaba did $9.3 billion in revenue on Singles Day, shipping 278 million orders in 24 hours. The same-day delivery window requires a new way of thinking about transportation and logistics. China struggles with delivery, mostly because of an underinvestment in infrastructure and inefficient regulation. So, Alibaba has pledged to invest billions of dollars in order to link third-parties to deliver shipments. (Source) 
  • Busiest Thanksgiving Since 2007. 7 million Americans were expected to travel at least 50 miles for the Thanksgiving holiday, that’s 1 million more people compared to last year. This represents a 1.9% increase over 2015, and the most Thanksgiving travelers since 2007. AAA credits the increase of travel to inexpensive fuel (the second-lowest in a decade for the holiday travel period), rising wages and increased consumer confidence. (Source)

  • Record Breaking Cargo Activity at Port of LA. The Port of Los Angeles, the largest in the US based on container volume per year, had a record-breaking October. Cargo activity at the port surged 16%, making October 2016 the busiest ever for a western hemisphere container port. The port handled 814,574 industry-standard TEUs – the previous record was 800,063 in October 2006. Trucking drayage services aren’t experiencing the same volume; it has dropped 2.5% compared to this time last year. (Read: Will Cuba be the Next Major Transportation Hub?)
  • GOP-Led Congress Expected to Act on Highway Funding. Trucking and transportation industry executives would like lawmakers to advance and President-elect Trump sign a long-term plan that would address the federal Highway Trust Fund’s sustainability. As Transport Topics mentions, highway construction is expensive, and Congress has been disagreeing on the subject of funding infrastructure for almost 25 years. (Read: Will the 45th President Secure Infrastructure Spend?
  • Brake Safety Week Results Are In. Commercial motor vehicles reported 13.2% of inspections resulted in out-of-service orders for brake violations during September’s Brake Safety Week. The CVSA reported 14.8% of inspected vehicles out-of-service with non-brake violations.
  • America’s Positive Outlook at Manufacturing. America’s growing energy sector is creating excitement among manufacturers and rail lines. Norfolk Southern Corp. is excited about long-term opportunities underway thanks to energy abundance in the US. “Cheap energy will influence manufacturing industries,” said the VP of Business Development at Norfolk. (Source)

 

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