Author: Vitaliy Dadalyan

Intermodal Volumes Reflect Sluggish Market Conditions

Total intermodal volume fell in the third quarter of 2016, according to an Intermodal Association of North America quarterly report.

Intermodal trailer volumes fell by 26.9% and international shipments fell 6.7%, which contributed to the 4.6% overall loss for the quarter. The domestic container business gained 3.3%, which helped to offset the losses.

"The Q3 results were in line with the previous quarter, reflecting sluggish market conditions," said Joni Casey, president and CEO of IANA. "Projections for 2017 are more optimistic, based on continued increases in consumer spending and expectations that the international side of the equation will stabilize."

The seven highest-density trade corridors account for more than 63% of total intermodal volume. Collectively, volume on these corridors fell by 3.9% year-over-year.

The Midwest-Northwest corridor saw a 3% gain in traffic while all other corridors posted declines. The largest was an 11.2% reduction in volume in the South Central-Southwest corridor followed by a 5.3% reduction in the Midwest-Southwest corridor.

Regionally, losses were widespread due to weaker international traffic. The Mountain Central and Mexico regions were both in the negative at 11.5% while Western and Eastern Canada came closest to breaking even, falling 0.2% and 2.9% respectively. The Southwest, Midwest and Southeast regions all posted losses around 4.6%.

The two exceptions were the Northeast and Northwest, which benefited from a growth in international shipments, driving increases of 0.1% and 4.4% respectively.

Intermodal marketing companies demonstrated gains in the highway market sector. Thanks to excess trucking capacity, highway volumes were up 14.6% from the previous year. Intermodal loads fell 11.6 %. The net result for reporting IMCs was a total volume decrease of 0.1%.

The Intermodal Market Trends & Statistics report is published quarterly by IANA and is available on a subscription and individual copy basis. The report features detailed analyses and reproducible graphical representations of Q3 2016 results. For ...Read the rest of this story

Earnings Watch: USA Truck Reports Quarterly Loss

The trucking company USA Truck reported on Friday that its financial picture turned slightly negative in the third quarter of the year as it continues to move to a more asset-light business.

Its net loss was $700,000 million, or 9 cents per share, compared to net income of $2.7 million, or earnings of 26 per share, a year earlier.

Revenue in the most recent quarter totaled $105.5 million compared to $123.5 million for the prior-year period. Revenue, which excludes fuel surcharges, was $94.7 million compared to $109.8 million for the 2015 period.

“We marked significant progress toward our goals of expanding the scope of USAT Logistics, improving service levels in our truckload business and reducing operating costs in the third quarter,” said President and CEO Randy Rogers. “Those gains were, and for the near term will likely be, offset by a weak freight environment and unfavorable comparisons versus prior periods due to the loss of certain dedicated account customers earlier this year.”

He said that while he's encouraged by the company's progress, USA recognizes the results have fallen short of goals and hopes to achieve substantial improvements in profitability as the Arkansas-based company moves into the 2017 bid season.

“One of our principal goals is for our higher margin, asset-light brokerage operations to contribute 50% of the company's consolidated revenue,” Rogers said. “In support of this objective, during the quarter we expanded its sales channels to include agents in secondary markets and since have consolidated operations from smaller, inefficient offices into our larger regional centers while maintaining existing client manager relationships.”

USA Truck said it achieved a modest improvement in loaded rate per mile to $1.725 despite the difficult rate environment. The company also said it posted a 4.3% decrease in operating expenses from the previous quarter to the lowest in more than four years.

“In light ...Read the rest of this story

Continental Tire Breaks Ground for New Mississippi Tire Plant

CLINTON, MISSISSIPPI -- Continental is investing more than $1.4 billion in a new truck tire manufacturing plant. The official groundbreaking ceremony took place on Wednesday. The facility is located in Hinds County off of Interstate 20, two miles from Clinton and 20 miles from the state capital of Jackson, and will employ about 2,500 people by the time it reaches full capacity in the next decade.

Continental expects to begin actual construction of the plant in 2018, following 18 months of clearing and preparation work at the 1,000-acre site.

"Building this new facility in Mississippi is a critical part of our growth strategy for Continental Tire, known as Vision 2025," said Nikolai Setzer, member of Continental's Executive Board and head of Continental's global tire business worldwide. "This is the first new plant, globally, for the truck tire business in more than ten years. We are convinced that the state of Mississippi provides the best options for Continental to grow our tire business."

Setzer says Continental looked at many prospective sites, including Mexico, before settling on Clinton Mississippi.

"We looked at the entire picture, including where our customers are and how we get raw material into the plant," he said. "We looked at economic and political stability, currency exchange rates, the availability of a skilled labor force, sources of training and even the size of the available land plots."

Continental says growth in its commercial vehicle tire business has consistently exceeded the market over the last five years and the company continues to see customer demand for its products -- both new truck and bus tires as well as retreads which are growing beyond the company's existing capacity.

“This plant is a significant step in addressing our commitment to grow our commercial vehicle tire business in North America,” said Paul Williams, executive vice president, commercial vehicle tire, ...Read the rest of this story