Talking Transports

The first quarter may have marked the bottom for freight markets, even as the outlook remains mixed with a high degree of uncertainty. In this Talking Transports podcast, Ravi Shanker, Morgan Stanley’s managing director and lead analyst for North American freight transportation and airlines, joins Lee Klaskow, Bloomberg Intelligence senior transportation and logistics analyst, to share his takeaways from 1Q earnings and his longer-term outlook. Shanker expects the truckload market cycle will turn on increased demand over an acceleration of supply leaving the market as inventories are restocked. He also talks about precision-scheduled railroading, focusing beyond operating ratio for railroads, parcel markets, airlines service, less-than-truckload valuation and how a quote in Car and Driver magazine changed his life. See omnystudio.com/listener for privacy information.

New and pending shipping regulations are increasing the complexity and costs to operate in the dry-bulk market, resulting in higher barriers to entry. This could drive market consolidation as carriers look to build scale. In this Talking Transports podcast, Cetus Maritime Chief Operating Officer Olivia Lennox-King joins Lee Klaskow, Bloomberg Intelligence senior transportation and logistics analyst, to talk about the state of the dry-bulk and handysize markets. Increased ton-miles from market dislocation, like those in the Red Sea, coupled with a low order book, should bode well for Handy-size rates this year. Lennox-King also talks about how the sector will most likely look to meet global standards to reach net-zero greenhouse-gas emissions by 2050. See omnystudio.com/listener for privacy information.

A more competitive bid season, an irrational spot market and severe January weather took a toll on truckers this year. More capacity will need to exit the market before freight rates and earnings can inflect positively for truckload carriers. In this Talking Transports podcast, American Trucking Associations’ (ATA) Chief Economist and Senior Vice President Bob Costello joins Lee Klaskow, Bloomberg Intelligence senior transportation and logistics analyst, to talk about the state of the truckload and less-than-truckload segments and what lies down the road for the trucking industry. The market has become more volatile, and a turnaround will likely happen quicker than in previous cycles, Costello says. He also talks about autonomous trucking, electric trucks, new emission standards and driver availability. See omnystudio.com/listener for privacy information.

Assessing and mitigating geopolitical risks is becoming more important for supply chains. In this Talking Transports podcast, Eurasia Group’s president and founder Ian Bremmer joins Lee Klaskow, Bloomberg Intelligence’s senior transportation and logistics analyst, to share his perspective on the threat of an escalating conflict between Israel and Iran as well as hot spots around the world that have an impact on global trade. Increased tensions between China and its neighbors in the South China Sea could have ripple effects on trade and may be more of a peril for regional stability than a conflict with Taiwan. Bremmer also talks about artificial intelligence, the rise of populism, social media’s impact on the political process and what a change in the administration in the US might mean for businesses. See omnystudio.com/listener for privacy information.

There’s plenty to unpack this year from road, rail, ocean and air freight markets as the 1Q earnings season kicks off with J.B. Hunt on April 16. In this Talking Transports podcast, Barclays’ director of airline and transportation research Brandon Oglenski joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to share his thoughts about the quarter and his longer-term outlook. With changes underway at Union Pacific, Norfolk Southern and Canadian Pacific Kansas City, Oglenski says this will be the year of the railroad. He also talks about precision schedule railroading, less-than-truckload prospects, the US Postal Service’s shift toward UPS and all of the freight that’s piling up in the West Coast ports. See omnystudio.com/listener for privacy information.

Supply chain dislocations, low orderbook and low-single-digit demand growth for oil bodes well for crude tanker rates over the coming years. In this Talking Transports podcast, DHT Holdings President and CEO Svein Moxnes Harfjeld joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss the outlook for the very large crude carrier (VLCC) tanker market. The changes in freight flows from Russia’s war with Ukraine has had a bigger impact on rates then the crisis in Red Sea, as VLCC ships don’t traverse the Suez Canal when fully loaded. Moxnes Harfjeld also talks about DHT’s approach to lowering emissions, the shadow fleet, changes in global crude demand and life before shipping as a drummer in the band Small Affairs. See omnystudio.com/listener for privacy information.

Better service and reduced rate volatility are just some of the benefits to becoming a shipper of choice. In this Talking Transports podcast, John Janson SanMar’s Vice President of global logistics, joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss how relationships with trucking, intermodal, parcel and ocean partners are critical for managing his supply chain. SanMar has moved some imports away from the East Coast to avoid potential disruption due to pending labor negotiations. Janson also talks about bid season across modes of transportation, railroad service, inventory destocking, sustainability, near-shoring trends and how he pushed his dream of being a placekicker for the Chicago Bears aside for a career in logistics. See omnystudio.com/listener for privacy information.

Shippers are increasingly looking for freight forwarders to drive more-resilient networks, which are under strain from risks in the Red Sea, low water levels in the Panama Canal, port labor negotiations and a trend toward derisking supply chains. In this Talking Transports podcast, DHL Forwarding’s CEO of the Americas Tim Robertson joins Lee Klaskow, Bloomberg Intelligence senior transportation and logistics analyst, to discuss how DHL is positioning in a rapidly changing environment. A focus on high-growth segments like health care and small- to medium-sized shippers should fuel organic expansion at one of the largest forwarders. Robertson also talks about technology-fueled productivity investments, market consolidation, near-shoring trends and how a chance meeting got him into logistics. See omnystudio.com/listener for privacy information.

A focus on value-added verticals, like life sciences and over-dimensional markets, has helped mitigate the weak freight backdrop for some North American freight brokers. In this Talking Transports podcast, Tucker Company Worldwide CEO Jeff Tucker joins Lee Klaskow, Bloomberg Intelligence senior transportation and logistics analyst, to discuss the broker’s more resilient business model and how the company may be positioned for growth when the freight cycle turns. Trucking conditions could improve as the market appears to be at equilibrium, with more capacity slowly leaving the market and demand growth likely around the corner. Tucker also talks about technology, the bid season, sustainability and the importance of therapy and communication when running a privately held business with his brother. See omnystudio.com/listener for privacy information.

The exit of Yellow Corp. from the less-than-truckload (LTL) market last summer helped mitigate weak freight demand and provided a tailwind for pricing. In this Talking Transports podcast, Old Dominion Freight Line’s CFO Adam Satterfield joins Lee Klaskow, Bloomberg Intelligence senior freight transportation & logistics analyst, to discuss the outlook for LTL markets and how the company is positioned to take on more freight demand when it starts to inflect upward. The company’s industry-leading service levels — measured by low cargo claims and high on-time deliveries — has allowed it to drive rates higher. Tonnage growth should come at high incremental margin and could drive a sub-70 operating ratio over time. See omnystudio.com/listener for privacy information.

Transport management teams appear cautiously optimistic that freight demand will bounce off the current state of malaise. In this Talking Transports podcast, Citi Research Managing Director and lead equity analyst of air freight, surface and marine transportation Christian Wetherbee joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss his takeaways from Citi’s industrial conference in Miami last week. J.B. Hunt’s management noted increased competition early on during its intermodal bid season. Norfolk Southern’s presentation left the audience wanting more details about how its strategy is better than the one proposed by activist Ancora. Wetherbee also talks about how the trucking, railroad, ocean and parcel markets are shaping up heading into March. See omnystudio.com/listener for privacy information.

The crisis in the Red Sea, low water levels in the Panama Canal and other supply-chain dislocations have increased the importance of enabling shippers to know where their freight is. That helps ensure customers’ needs are met and production shutdowns avoided. In this Talking Transports podcast, Project44’s founder and CEO Jett McCandless joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss the importance of supply-chain visibility and how the company is leading the digitalization of freight markets. McCandless also talks about acquisitions, investing for growth and leveraging its datasets with AI to empower customers, as well as the company’s journey toward going public and getting an enterprise value of over $100 billion. See omnystudio.com/listener for privacy information.

The low orderbook, demand growth and longer ton-miles created by supply-chain disruptions bode well for the health of the dry-bulk industry. In this Talking Transports podcast, Seanergy Maritime Holdings Chairman and CEO Stamatis Tsantanis joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss the opportunities and challenges facing the global dry-bulk shipping market. A prolonged crisis in the Red Sea could drive Capesize rates and profit higher for owners in the coming months. One of the biggest challenges will be the industry’s ability to meet the International Maritime Organization’s goals for zero emissions by 2050 through a transition toward greener fuels, he says. Tsantanis also talks about the impact of Russia’s war on Ukraine and China’s demand for raw materials. See omnystudio.com/listener for privacy information.

The worst appears to be behind transportation markets, and it’s just a matter of time before the freight recession gives way to growth. In this Talking Transports podcast, Deutsche Bank’s managing director in charge of transportation and shipping research, Amit Mehrotra, joins Bloomberg Intelligence senior transportation & logistics analyst Lee Klaskow to discuss the outlook for freight markets and which companies have secular tailwinds. He’s looking for companies with opportunities for outsized demand growth or turnaround-operations stories. J.B. Hunt, Saia, Norfolk Southern, Union Pacific and UPS are some of Mehrotra’s favorite freight stocks in 2024. He also talks about precision-schedule railroading, intermodal trends, the Red Sea crisis and share opportunities for less-than-truckload carriers. See omnystudio.com/listener for privacy information.

Less-than-truckload (LTL) pricing power and share gains from the demise of Yellow last year could position carriers for earnings growth and margin expansion in 2024. In this Talking Transports podcast, Saia President and CEO Fritz Holzgrefe joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss the outlook for the LTL markets and the company’s expansion prospects. Improved service and increased reach has helped Saia offset inflationary pressures, with an 8.7% increase in contract renewals in 4Q. It plans to open 15-20 new terminals to better serve customers and provide a springboard for organic growth. Holzgrefe also talks about how the company is investing in facilities, tractors, trailers and technology to position for expansion. See omnystudio.com/listener for privacy information.

The worst appears behind the freight transportation market and there are early indications that 2024 will be better than last year. In this Talking Transports podcast, NFI Industries’ Vice Chairman and President Ike Brown joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss where we are in the freight cycle and how the company is positioned for growth in the dedicated, drayage, warehousing and brokerage segments. NFI’s businesses are facing rate and margin pressures given the weak freight backdrop. Being a private company allows NFI to invest through the cycle to be better positioned for when growth returns. Brown also talks about electric trucks, technology as a productivity tool, freight flows and what’s it like to manage a family operation with his two brothers and their kids. See omnystudio.com/listener for privacy information.

Freight transportation and logistics companies may face lower costs to attract and retain employees now that tighter labor conditions are loosening, which could help margins in 2024. In this Talking Transports podcast, CS Recruiting’s CEO and founder Charlie Saffro joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss how the labor markets have evolved since the pandemic and what companies can expect this year. The freight economy has been weakening since 2022, as illustrated by the closing of Yellow, a large less-than-truckload carrier, and technology-driven freight broker Convoy, last year. This is leading to weaker labor conditions relative to the national market. CS Recruiting is an executive search firm specializing in the supply-chain, logistics and transportation industries. See omnystudio.com/listener for privacy information.

US railroads may still be too short staffed to continue improving service, especially as volumes recover this year. In this Talking Transports podcast, the Surface Transportation Board (STB) Chairman Martin Oberman joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss the state of the railroad industry from the regulator’s perspective. Lower head counts from the transition to precision-scheduled railroading and furloughs in 2020 contributed to poor service and supply-chain dislocations during the pandemic, Oberman says. Improving service is imperative for railroads to win share back from trucks and also for the overall health of the economy. Oberman also discusses reciprocal switching, industry consolidation and his pending retirement from the STB. See omnystudio.com/listener for privacy information.

Increased attacks on vessels in the Red Sea are among a number of dislocations and challenges facing the global marine-shipping industry in 2024. In this Talking Transports podcast, Scorpio Tankers President and Director Robert Bugbee joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss the state of the product-tanker industry. Ton-miles were already rising amid supply-chain changes and the impact of the war in Ukraine and low water levels in the Panama Canal. A low order book bodes well for product-tanker rates into 2025, even after the near-term benefits from ships diverting around the Cape of Good Hope, Bugbee says. He also discusses Scorpio’s fleet, its use of cash and where ship technologies are changing to meet long-term emissions targets. See omnystudio.com/listener for privacy information.

Improving service levels will be critical for the railroad industry to win market share from other modes. In this Talking Transports podcast, Association of American Railroads (AAR) President and CEO Ian Jefferies joins Lee Klaskow, Bloomberg Intelligence senior transportation & logistics analyst, to discuss how the railroad industry is focused on providing a safer and more predictable service, which along with infrastructure investments could help capture share from trucking. This might help the industry surpass peak intermodal volume reached in 2018. Railroads have changed their approach to labor based on the lessons learned from the pandemic era. Jefferies also discusses how proposed regulations could affect railroads, and the benefits from precision scheduling. See omnystudio.com/listener for privacy information.