Dear Outside Counsel – Advice from Your In-House Transportation Colleagues

Dear Outside Counsel – Advice from Your In-House

PRESENTERS Transportation Colleagues

Cheryl A. Barnes

Cheryl Barnes has been a practicing attorney for over 20 years and has held the position of General Counsel for the past 10. She currently serves as VP, Legal Affairs and General Counsel for Estes Forwarding Worldwide, a Richmond based transportation company. In this role Ms. Barnes oversees all legal issues, ranging from insurance and contracts to Human Resources, which provide her the opportunity to work with a wide variety of outside counsel.

Prior to Estes Forwarding, Ms. Barnes worked as Associate Counsel for the national non-profit, Covenant House Washington in Washington, DC where she worked extensively on government compliance, property acquisitions and contract negotiation. Before moving to DC, Ms. Barnes began her legal career practicing criminal law working as a Public Defender at both the State and Federal levels.

Ms. Barnes received her BA in Psychology and Political Science from the State University of New York, Oneonta and her JD from Capital University Law School. She is admitted to the bar in Virginia, the District of Columbia and Ohio.

Ms. Barnes is a member of the Transportation Lawyers Association and the Virginia Bar Association.

Matthew A. Gernand

No biographical information provided.

The biographical information is provided by the speakers or collected from their websites.

Dear Outside Counsel - Advice From Your In- House Transportation Colleagues January 26, 2019 | Williamsburg Lodge | Williamsburg, VA

CONTINUING Written Materials LEGAL EDUCATION

A presentation of The Virginia Bar Association’s Transportation Law Section

DEAR OUTSIDE COUNSEL – ADVICE FROM YOUR IN-HOUSE TRANSPORTATION COLLEAGUES

129th Annual Meeting of the Virginia Bar Association January 26, 2019

Presented By:

Cheryl Barnes, Esq., VP, Legal Affairs and General Counsel, Estes Forwarding Worldwide Matthew A. Gernand, Esq., Norfolk Southern Corporation

DEAR OUTSIDE COUNSEL – ADVICE FROM YOUR IN-HOUSE TRANSPORTATION COLLEAGUES

BIOGRAPHIES OF SPEAKERS

Cheryl Barnes, Esq., VP, Legal Affairs and General Counsel, Estes Forwarding Worldwide Cheryl Barnes joined Estes Forwarding Worldwide in 2008 and currently serves as vice president of legal affairs and general counsel. She began her career practicing criminal law, acquiring her trial skills as a public defender at both the state and federal levels. She then spent several years as associate counsel for a national nonprofit organization in Washington, D.C. In this role Cheryl was responsible for contract negotiation, government compliance, acquisition of new properties and overseeing the HR department. Cheryl received her BA in psychology from the State University of New York College at Oneonta and her JD from Capital University Law

School.

Matthew A. Gernand, Esq., Norfolk Southern Corporation Matthew Gernand joined Norfolk Southern in 2012 and his practice focuses on Environmental and Health and Safety law. He provides counsel to Norfolk Southern in a wide range of areas including, permitting, real estate transactions, regulatory compliance and environmental litigation. Prior to joining Norfolk Southern, Matt was a partner at Bingham McHale in

Indianapolis, IN where his practice focused on Environmental Law. Prior to joining Bingham

McHale, Matt was an attorney for the Indiana Department of Environmental Management.

2 DEAR OUTSIDE COUNSEL – ADVICE FROM YOUR IN-HOUSE TRANSPORTATION COLLEAGUES

I. Best Practices for Outside Counsel When Working with In-House Counsel:

A. Ask and respect the preferences of in-house counsel regarding scope of outside counsel’s responsibilities. Every client is different and part of these differences include different preferences regarding communications, level of involvement in certain matters, and other, more nuanced preferences depending on the nature of the client’s business. It is the job of outside counsel to understand its role and balance the appropriate level of involvement.

B. Understand the company. Learn not just about the nature of the company’s business, but also about the corporate culture and what makes this particular company unique from others.

C. Identify creative solutions. Creativity and problem solving are two of the primary reasons that an in-house counsel retains outside counsel. If outside counsel is not adding value by thinking outside the box while still providing exceptional service, then in-house counsel may no longer find outside counsel’s services necessary or justifiable.

D. Communicate. Communication is key to preserving a strong relationship between in-house and outside counsel. Some in-house counsel want to be apprised and give approval before outside counsel can take any action. Other in-house counsel are the exact opposite and want to only be made aware of dispositive issues. Either way, communication and establishing the parameters of those communication is essential to maintaining a healthy in-house/outside counsel relationship.

E. Explain your methodology. Some outside counsel are subject matter experts in their respective areas of practice, which is likely what made them attractive to in-house counsel.

Leverage knowledge and expertise by explaining difficult legal concepts in a concise, easy-to- understand format.

3 DEAR OUTSIDE COUNSEL – ADVICE FROM YOUR IN-HOUSE TRANSPORTATION COLLEAGUES

F. Solicit feedback. Asking for constructive feedback can preserve and enhance an in-house/outside counsel relationship. Perhaps consider a “year in review” at the end of each year to reflect on the services provided and to identify areas for improvement. Having a formal mechanism for such feedback can help prevent tensions down the road.

G. Keep up with current events in our business and industry. Understanding the current industry news and trends makes outside counsel more effective.

H. Pay attention to key legal issues and cases, which may have legal ramifications within our business. Industry trends are helpful, but a grasp of current legal issues and recent developments in the law make for a well rounded outside counsel.

4 DEAR OUTSIDE COUNSEL – ADVICE FROM YOUR IN-HOUSE TRANSPORTATION COLLEAGUES

II. Hot Topics Affecting the Transportation Industry

A. Tariffs – The recent uncertainty surrounding trade action raises concerns of

increased prices and diminished returns. The American Road & Transportation

Builders Association has warned that "for every $1 spent on highway and bridge

construction, 10 cents goes toward steel-related materials,” meaning the recent steel

tariff would hurt “the transportation construction industry’s ability to deliver needed

infrastructure improvement projects.” Aerospace manufacturers are increasingly

using composite materials, which somewhat lessens the impact on steel and

aluminum imports on them, but not all transportation-related industries are so

fortunate. The Auto Alliance has commented that the contemplated tariffs “will result

in an increase in the price of domestically produced steel – threatening the industry’s

global competitiveness and raising vehicle costs for our customers."

B. Disruptive Technologies - Autonomous technologies and electrified equipment

are already increasing safety and improving efficiency in the transportation and

intermodal industries. Autonomous vehicles, but not necessarily driverless vehicles,

may be utilized most robustly in ports and other controlled environments. For

instance, in the maritime industry, smart ships that allow ships to operate with

different capabilities either remotely or under semi-autonomous or fully autonomous

control are on the horizon. In addition to autonomous, there are other technological

developments that may prove disruptive to the various transportation and intermodal

sectors. Drones, for instance, are becoming increasingly popular and dangerous for air

traffic.

5 DEAR OUTSIDE COUNSEL – ADVICE FROM YOUR IN-HOUSE TRANSPORTATION COLLEAGUES

C. Truck Driver Shortage – Demand for delivered goods is increasing, but the supply

of truck drivers continues to decline. It is estimated that 51,000 more drivers are

needed to meet current demand. The low supply of drivers is creating a capacity

crunch, which is forcing certain manufacturers and businesses to delay nonessential

shipments to avoid increased costs.

D. Investments in Infrastructure - On February 12, 2018, the President released his

infrastructure proposal, “Legislative Outline for Rebuilding Infrastructure in

America,” which places maritime infrastructure on equal footing with other surface

transportation modes in terms of potential funding opportunities. At the heart of the

proposal are three new programs – an Incentives Program, Rural Infrastructure

Program, and Transformative Infrastructure Program – that would be open to

maritime infrastructure-related projects, including deepwater ports, inland ports, locks

and dams.

E. Federal Arbitration Act - Transportation contracts inherently evidence “a

transaction involving commerce,” in the words of the Federal Arbitration Act, 9

U.S.C. § 1, et seq. Those that contain provisions for the resolution of disputes through

arbitration will fall within the purview of Section 2 of the Act. That section instructs

that “[a] written provision in any maritime transaction or a contract evidencing a

transaction involving commerce to settle by arbitration a controversy thereafter

arising . . . or to submit to arbitration an existing controversy arising out of such a

contract [or] transaction . . . shall be valid, irrevocable, and enforceable, save upon

grounds as exist at law or in equity for the revocation of any contract.”

F. Recent United States Supreme Court Cases

6 DEAR OUTSIDE COUNSEL – ADVICE FROM YOUR IN-HOUSE TRANSPORTATION COLLEAGUES

1. Atlantic Marine Construction Co., Inc. v. United States District Court for the

Western District of Texas, 571 U.S. 49 (2013) - held that the only proper

mechanism for enforcing a forum selection clause that calls for venue in a

particular federal court is via a motion to transfer venue pursuant to 28 U.S.C.

§1404(a).

2. Epic Systems Corp. v. Lewis, 584 U.S. ___ (2018) - arbitration agreements for

individualized proceedings must be enforced under the Federal Arbitration

Act.

3. Henry Schein Inc. v. Archer and White Sales Inc., argued Oct. 29, 2018

(decision pending) - the Court will decide whether the Federal Arbitration Act

permits a court to decline to enforce an agreement delegating questions of

arbitrability to an arbitrator if the court concludes the claim of arbitrability is

“wholly groundless.”

4. Lamps Plus, Inc. v. Varela, argued Oct. 29, 2018 (decision pending) - the

Court will decide whether the Federal Arbitration Agreement forecloses a

state-law interpretation of an arbitration agreement that would authorize class

arbitration based solely on general language commonly used in arbitration

agreements.

7 12/10/2018 America has a massive truck driver shortage. Here’s why few want an $80,000 job. - The Washington Post The Washington Post

Wonkblog Analysis America has a massive truck driver shortage. Here’s why few want an $80,000 job.

By Heather Long America has a massive shortage of truck drivers. Joyce Brenny, head of Brenny Transportation in Minnesota, increased driver pay 15 percent this year to try to attract more drivers. Many of her drivers now earn $80,000, she says, yet she still can't find enough people for the job.

About 51,000 more drivers are needed to meet the demand from companies such as Amazon and Walmart that are shipping more goods across the country, according to the American Trucking Associations. The driver shortage is already leading to delayed deliveries and higher prices for goods that Americans buy. The ATA predicts that it's likely to get worse in the coming years.

Many trucking companies are so desperate for drivers that they are offering signing bonuses and pay raises. So why don't more Americans want this job? We asked truck drivers who have been doing the job anywhere from four months to 40 years for their views.

Most said the answer is simple: The lifestyle is rough. You barely see your family, you rarely shower, and you get little respect from car drivers, police or major retailers. Michael Dow said he has been divorced twice because of trucking. Donna Penland said she gained 60 pounds her first year from sitting all day and a lack of healthful food on the road.

A few drivers told The Washington Post that they earn $100,000, but many said their annual pay is less than $50,000 (government statistics say median pay for the industry is $42,000). As for the bonuses, driver Daniel Gollnick said they are a “complete joke” because of all the strings attached.

Despite the hardships, half said they would recommend the job to friends and family, chiefly because, as Gollnick said, “it's the easiest money you can get without a college degree.” Here are the drivers' perspectives on America's trucking crisis.

“I have been divorced two times because of truck driving.” — Michael Dow

Michael Dow of Dallas has been a truck driver for more than two decades. He and his brother started a company, Dow Brothers Transportation, this year. They hope it will more than double their pay from prior years.

Age: 48

Why don't people want this job? “The pay is so far behind the curve. I make less money now than I did 20 years ago if you adjust for inflation and cost of living. I figured it out once, and I was making $14 or $15 an hour driving for the big carriers. People flipping hamburgers are demanding $15 an hour.”

Have you gotten a raise? “I have, because I went out and started my own company this year. The rates have never been this good in over 20 years. I hope the driver shortage continues. Skilled drivers like me aren't cheap right now. I'm anticipating I'll make $85,000 to $120,000 this year.”

Would you recommend this job? “I have a 21-year-old son in the military who is about ready to come out. In all honesty, I do not wish him to get into this industry because it's a hard life. I don't recommend it to anyone who has a family. My kids are in their 20s now. I missed most of their lives growing up. They tell me they wish I would have been home more. I have been divorced two times because of truck driving. For a real perspective, talk to a trucker's wife.”

“I see those ads for big driver bonuses, but it's a complete joke.” — Daniel Gollnick

Daniel Gollnick of Melrose, Wis., drives for a company that has him home each night. He used to drive a flatbed truck across the country, but his girlfriend didn't like him being away so much.

Age: 28

Yearly income: $45,000

Did you get a raise lately? “We got a $1 raise this year. We were at $17.50 an hour for most drivers. Now we're at $18.50. That barely covers inflation or anything. I see those ads for big driver bonuses, but it's a complete joke. I've worked for a couple of major trucking companies: Roehl Transport and Melton Truck Lines. Both offered sign-on bonuses, but what they don't tell you is what it's dependent upon to get that $1,000. Sometimes you needed to have certifications to deal with hazmat or be qualified to drive on military bases or ports. And you need to meet fuel-usage requirements, but they usually give you the oldest trucks that are least likely to get the sign-on bonuses because they use more fuel.”

Would you recommend this job? “I do. I tell friends who are working minimum-wage or factory jobs to go get their CDL [Commercial Driver's License, which takes a few weeks]. It's the easiest money you can get without a college degree, but it's a hard industry. You're going to be alone a lot.”

Is the industry in a crisis? “There are not enough truckers. I've been running around doing extra runs, because we are shorthanded. But I've noticed I'm not truly picking up more physical freight. I'm just picking up at more places.”

https://www.washingtonpost.com/news/wonk/wp/2018/05/28/america-has-a-massive-truck-driver-shortage-heres-why-few-want-an-80000-job/?utm_term=.094fd9ae… 2/7 12/10/2018 America has a massive truck driver shortage. Here’s why few want an $80,000 job. - The Washington Post “I gained 60 pounds because it's a sedentary life.” — Donna Penland

Donna Penland of Houston decided to get her CDL 18 months ago after her boyfriend was laid off from his job and wanted to try trucking. The duo “teamdrove” a truck, meaning they would trade off driving so the vehicle would be on the road almost 24 hours a day. They eventually broke up, but Penland continued driving on her own.

Age: 50

Yearly income: "$50,000 is where you’re going to be when you work for a big company. If you want to make more money than that, you have to find an independent person with two or three trucks that really does appreciate you as a driver and they share profits with you.”

Have you received a raise? “I work for Marten Transport now. They don't offer signing bonuses, but I work on a Coca-Cola dedicated route, and Coke is putting up bonuses because they need drivers. So I got a $3,500 signing bonus. But they don't just give you $3,500. I received $500 after 30 days and another $1,000 after 60 days. They spread it out.”

Would you recommend this job? “No. Not to most of my friends. It takes a special kind of person, because you basically give up your life for the job. You are dedicated to that truck. Most people are 'over the road' drivers, because that is where you make the most money. It means you go coast to coast and border to border. You are supposed to get a day off after every seven days of driving, but companies prefer that you stay out 60 days and then take just a few days off. I gained 60 pounds because it's a sedentary life. You just drive, sleep, drive, sleep. Companies don't treat you like a human. You are a just a machine that makes money for them.”

Is this a good job for women? “I think it is a good profession for women, but there are a lot of doors to break down. The guys treat you like you're stupid and don't know anything. And companies are almost always asking you to do stuff that's illegal — to work extra hours or to dump trash illegally.”

“I wouldn't let my kids even think about doing this.” — Boris Strbac

Boris Strbac of Milwaukee is the manager of Star Trucking. He employs 35 drivers and is a former driver who has worked for other companies and on his own.

Age: 45

Would you recommend this job? “Never. I wouldn't let my kids even think about doing this. This is a really, really hard job. On top of that, people don't respect truck drivers. We are treated as the bad guys on the road by other drivers and the police. The majority of police treat drivers like criminals. We get pulled over for stupid stuff. One of my drivers got a violation because he didn't have enough windshield fluid. That violation stays on the driver's record and my company's record for three years.” https://www.washingtonpost.com/news/wonk/wp/2018/05/28/america-has-a-massive-truck-driver-shortage-heres-why-few-want-an-80000-job/?utm_term=.094fd9ae… 3/7 12/10/2018 America has a massive truck driver shortage. Here’s why few want an $80,000 job. - The Washington Post Is the industry in a crisis? “We are seeing record bookings this year and record pay per mile. The reason is there aren't enough drivers. The whole industry is a mess. And it's going to get a hell of a lot more interesting soon. No one knows what to do about the driver shortage. People are banking on driverless trucks, but those are not coming anytime soon.”

“You can kiss your social life goodbye.” — Lee Klass

Lee Klass of Portland, Ore., has been driving for four decades. He owns his truck now and does the jobs he wants. He says the real problem isn't the shortage of drivers — it's all the experienced drivers leaving.

Age: 70

Yearly income: Just less than $50,000

How can companies attract more drivers? “Less rules, more money.”

What has changed about truck driving in 40 years? “There's massive turnover in truck driving. People are leaving by the tens of thousands. It's a tough life, and there are too many regulations now. There's a ton more electronic monitoring than when I started. For people who have issues with authority, and I was certainly one of those, this was a good job. You were left on your own. As long as you got your loads delivered, nobody bothered you. Now you're monitored. As soon as you stop, you get a message from the company asking, 'Why have you stopped?' And the government is tracking you with the electronic logging device.”

[In December, the U.S. government required all truck drivers to switch to electronic logging devices that track their hours and ensure they don't drive more than 11 hours during a 14-hour period. Then drivers are required to take a 10-hour break.]

Would you recommend this job? “You can kiss your social life goodbye.”

“It's more than getting behind a steering wheel and driving.” — Ryan Kitchel

Ryan Kitchel of Greensboro, N.C., has been a flatbed truck driver for two years. He used to work in emergency services but wanted a change. He is home most weekends, but during the week he drives all over the East Coast with “open trailers” that carry steel, roofs, FEMA trailers and more.

Age: 36

Yearly income: $100,000

https://www.washingtonpost.com/news/wonk/wp/2018/05/28/america-has-a-massive-truck-driver-shortage-heres-why-few-want-an-80000-job/?utm_term=.094fd9ae… 4/7 12/10/2018 America has a massive truck driver shortage. Here’s why few want an $80,000 job. - The Washington Post Have you gotten a raise lately? “I make decent money. I get paid a percentage [of my load cost]. But I make about the same that my dad made in the 1970s.”

What's frustrating about being a truck driver? “My dad was a truck driver. There was a different level of respect for truck drivers then and more camaraderie. Car drivers today have no understanding of what we do. They cut us off all of the time. Car drivers see a space between trucks, and they jump in. They don't realize that's our stopping lane. We need that space.”

Why aren't more people becoming truckers? “I used to train drivers. A lot of guys don't realize everything that is involved in trucking. It's more than getting behind a steering wheel and driving. You got to be able to do your paperwork. You got to watch your surroundings. You have to keep the truck and trailer in line. You have to watch everyone around you, because cars aren't watching.”

Would you recommend this job? “Yeah. What other job are you going to do minimum training for and jump out of the box making $50,000?”

“Companies don't want to hire you until you have six months of experience.” — Donald Rich

Donald Rich of Yountville, Calif., spent 20 years as a cook in the Army. After retiring from the military, he began working at restaurants, but the pay was so lousy that his wife encouraged him to become a truck driver. He got his license in February and was hired immediately.

Age: 53

Yearly income: $60,000 (expected)

What do you like so far about trucking? “It pays twice as much as the restaurant business. And the potential is there to make a lot more. The first year is supposed to be the hardest. A lot of trucking companies don't want to hire you until you have at least six months of experience.”

Have other companies tried to lure you away? “Yes. Other companies have already tried to lure me away. I've had calls from eight or nine companies already. Some tell me to stay where I am and get more experience.”

Why is the industry in a crisis? “There's a lot of wasted time in trucking. The industry could be a lot more efficient. You end up sitting outside a business for six or eight hours waiting for someone to unload your truck. Businesses don't care, but you are losing hundreds or thousands of dollars of potential pay because you have to just wait.”

https://www.washingtonpost.com/news/wonk/wp/2018/05/28/america-has-a-massive-truck-driver-shortage-heres-why-few-want-an-80000-job/?utm_term=.094fd9ae… 5/7 12/10/2018 America has a massive truck driver shortage. Here’s why few want an $80,000 job. - The Washington Post Would you recommend this job? “Yes. It will give you a survival income. But it might not be for you if you don't like small enclosed spaces and you want to bathe more than twice a week.”

Teddy Amenabar contributed to this report.

Correction: An earlier version of this story said Donna Penland drives for Martin Transportation. She drives for Marten Transport.

The U.S. doesn’t have enough truckers, and it’s starting to cause prices of about everything to rise

The rise of the blue-collar signing bonus — now up to $25,000

The alarming statistics that show the U.S. economy isn’t as good as it seems

Heather Long Heather Long is an economics correspondent. Before joining The Washington Post, she was a senior economics reporter at CNN and a columnist and deputy editor at the Patriot-News in Harrisburg, Pa. She also worked at an investment firm in London. Follow 

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39,761 views | Feb 8, 2018, 09:00am The Four Biggest Freight Transportation Trends To Watch For In 2018

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POST WRITTEN BY Kristy Kristy Knichel Knichel

Kristy Knichel is a Pittsburgh native and CEO/President of her family-owned and operated company, Knichel Logistics.

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https://www.forbes.com/sites/theyec/2018/02/08/the-four-biggest-freight-transportation-trends-to-watch-for-in-2018/#20d57efcf16a 1/11 12/9/2018 The Four Biggest Freight Transportation Trends To Watch For In 2018 The transportation industry is entering into a new year that has the potential to be even stronger than the previous one. DAT reports a particularly robust year in shipping in 2017, especially in the second half. Based on what we have seen in the industry during that time, here are the top four trends to watch for in the freight transportation industry for 2018.

Capacity Crunch

We are experiencing a market with low truck supply and high freight demand. One of the reasons for tightened capacity is the ongoing driver shortage. Year after year, older drivers are retiring with fewer younger drivers taking their places. The work is difficult -- it involves working long hours, driving long distances, being away from family for long periods of time and less-than-ideal pay. Fewer drivers mean fewer trucks on the road to haul this increase in freight, which, in turn, drives up the rates because of the premium placed on securing a truck. It was a good year for the U.S. economy, and this additional freight volume combined with two major hurricanes diverting resources also greatly impacted the ability to secure trucks.

Another factor that is impacting capacity is increased government regulations such as the electronic logging devices mandate which began on December 18. The ELD mandate essentially requires all motor carriers to install electronic devices in their trucks that will automatically track drivers’ hours of service. By law, drivers are only allowed to drive for 11 hours with a mandatory, continuous rest period of 10 hours, daily. Prior to the mandate, most (but definitely not all) drivers kept manual log books to track their hours of service, while some of the larger carriers already had ELDs. Most smaller carriers have become compliant, but some are having issues with the cost of installing the devices and even more dislike the automatic tracking of their movements. Regulations such as these are implemented with the intention of creating safer roads, however, they are also perceived by drivers as an infringement on their personal space -- as many consider their trucks to be a home away from home in addition to a workspace.

Rising Rates

https://www.forbes.com/sites/theyec/2018/02/08/the-four-biggest-freight-transportation-trends-to-watch-for-in-2018/#20d57efcf16a 2/11 12/9/2018 The Four Biggest Freight Transportation Trends To Watch For In 2018 Spot rates were on the rise for much of 2017 and could continue to do so throughout 2018. This trend goes hand in hand with the capacity crunch. As freight demand rises and supply (available trucks) falls, rates rise. There are typically two types of rates in the transportation industry: spot market rates and contract rates. Spot rates are those that are quoted on the spot and are typically done for freight that is ready to move. Contract rates are those that are locked in with a carrier via contract with the shipper and are usually based on a year-long estimate of freight volume.

Eventually rates will stabilize, but for the time being, I expect them to rise as capacity remains tight. The likely outcome of increased truck rates will be the transition from highway transport to rail freight. Intermodal or rail is typically less expensive than truck due to the nature of the mode, and we are already seeing shippers switch to intermodal to circumvent the capacity and rate issues of the highway.

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Disruptors

More and more, we are seeing new technologies break into the transportation scene. Uber Freight launched last spring and is essentially an app for freight that operates like Uber’s ride-sharing service. Both Convoy and Amazon have apps that target on-demand freight, as well. These apps operate by matching trucking companies with shippers who have freight that needs to move.

One of the things I think they may have success with is capturing transactional market share. Currently, these apps are in their infancy and are in limited geographic markets, but there is potential for growth. From our end, we are seeing transactional business pick up substantially, so it’s highly probable that https://www.forbes.com/sites/theyec/2018/02/08/the-four-biggest-freight-transportation-trends-to-watch-for-in-2018/#20d57efcf16a 3/11 12/9/2018 The Four Biggest Freight Transportation Trends To Watch For In 2018 more shippers will become willing to embrace any solution that provides them with a truck. And carriers will be more than willing to embrace it if they feel those platforms can offer them higher- and faster-paying freight.

Another potential disruptor is the autonomous vehicle boom. Tesla has already unveiled their electric semi-truck, which has a range of 500 miles on one charge. Pre-orders are piling in from large asset companies, so there is clearly an interest in this technology. No longer having to pay for diesel fuel or the upkeep of maintaining a combustion engine, while having increased visibility from the streamlined cabin of this truck are all alluring factors to many drivers. It looks like right now the only thing holding Tesla back is the 500-mile cap and current lack of charging stations.

I still think we are a few years out from seeing autonomous trucks impact the industry in any significant way. A lot of the activity, industry chatter and pre- orders is likely due to the fact that larger asset companies want to make sure they are not just standing around with their hands in their pockets -- they want to show their shareholders that they are not ignorant of innovative technology and what may be a new era of transportation.

Changing Behaviors

Both shippers and carriers will have to be flexible in this new shipping environment. Most individuals generally only change behaviors if they can no longer deal with less-than-ideal situations. With that being said, it will be interesting to see how shippers (specifically the ones that have a reputation for not being driver friendly) change their behaviors.

On the carrier side, as long as supply and demand stay relatively status quo, you will see carriers act more selectively with the business they handle. This will be realized by carriers taking significant increases for specific business or flat-out refusing to work with shippers that are no longer a strategic choice for them. A good example of this behavior would be axing shippers that make drivers wait. Now, more than ever, time equals money and time spent sitting at loading docks unnecessarily cuts into the bottom line for carriers. https://www.forbes.com/sites/theyec/2018/02/08/the-four-biggest-freight-transportation-trends-to-watch-for-in-2018/#20d57efcf16a 4/11 12/9/2018 The Four Biggest Freight Transportation Trends To Watch For In 2018 Young Entrepreneur Council (YEC) is an invitation-only, fee-based organization comprised of the world's most successful entrepreneurs 40 and younger. YEC members represent nearly every industry, generate billions of dollars in

revenue each year an... MORE

43,450 views | Nov 30, 2018, 09:41am An Escalating Crisis In Central African Republic

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https://www.wsj.com/articles/tighttruckingmarkethasretailersmanufacturerspayingsteepprices1515150000

WSJ LOGISTICS REPORT Tight Trucking Market Has Retailers, Manufacturers Paying Steep Prices Some companies are delaying nonessential shipments rather than scramble to ind a truck

Freight demand has strengthened in recent months, as manufacturing activity expanded and retailers stocked up for the holidays. A tractor trailer rolls along the highway in Miami in November. PHOTO: JOE RAEDLEGETTY IMAGES

By Jennifer Smith Updated Jan. 5, 2018 218 p.m. ET

Retailers and manufacturers grappling with an unusually tight trucking market are paying the steepest prices in years to keep their goods moving.

Freight demand had been ticking up for months, closely tracking the strengthening U.S. economy. The market got a boost from retailers needing to restock stores and distribution centers amid the biggest jump in holiday sales since 2011. That wave of demand hit the trucking market just as a new federal safety rule kicked in, leading some drivers to idle their big rigs.

By the end of last week, just one truck was available for every 12 loads needing to be shipped, according to online freight marketplace DAT Solutions LLC. That is the most unbalanced market since October 2005, after Hurricane Katrina, and compares with a roughly 1-to-4 ratio at the end of 2016.

Some companies are delaying nonessential shipments rather than scramble to ﬁnd a truck. Others are paying a premium to ensure big rigs will be waiting at their warehouses when they need them. The cost to hire the most common type of big rig shot up to $2.11 per mile, including a fuel surcharge, in the week ended Dec. 30, a 3½-year high, DAT said.

“There’s a shortage of trucks available…there’s delays in shipping,” said DAT analyst Mark Montague. “Some loads that have to move [right now] are paying extremely high rates.”

Trucking companies are responding to strong demand by ordering more trucks from manufacturers. Fleets reserved 37,500 Class 8 trucks, the kind used on long-haul routes, in December, the most in a single month in three years, according to ACT Research.

Freight demand strengthened in recent months as manufacturing activity expanded and retailers stocked up for the holidays. Year-end sales soared past expectations, growing at their fastest pace since 2011, according to Mastercard SpendingPulse. That led some retailers to hire https://www.wsj.com/articles/tight-trucking-market-has-retailers-manufacturers-paying-steep-prices-1515150000 1/2 12/10/2018 Tight Trucking Market Has Retailers, Manufacturers Paying Steep Prices - WSJ even more trucks to replenish stores and distribution centers. Surging online sales have extended freight demand deeper into the holiday season, as retailers and delivery ﬁrms hustle to ship millions of packages to consumers’ doorsteps by Christmas.

The new federal mandate may have exacerbated the capacity crunch. Starting Dec. 18, most big rigs must be equipped with electronic devices that monitor drivers’ hours behind the wheel. The rule is meant to reduce accidents stemming from driver fatigue by increasing compliance with existing limits on driving time.

While most large fleets already track driver hours electronically, many smaller fleets and truckers who own their own vehicles waited until the last minute to switch over from paper logs, which officials say are easier to falsify.

Some drivers reported trouble getting their new electronic logging devices, or ELDs, up and running. Others said they planned to park their trucks over the holidays. Analysts expect some drivers will now cover fewer miles a day because the devices make it easier for law enforcement to know when truckers have exceeded federal limits on driving time.

For example, in the past few weeks the price to ship freight between 500 miles and 750 miles has shot up 30% on some routes, said Dave Menzel, chief operating oﬃcer for Echo Global Logistics Inc., a brokerage. With stricter timekeeping, routes of that length might take two days instead of one, forcing companies needing next-day delivery to hire more-expensive team drivers, Mr. Menzel said.

“We’re seeing a premium on teams that can move loads quickly,” he said.

Frigid weather across much of the U.S. has also increased demand for trucks with temperature- controlled trailers that can keep perishables from freezing. Last week the average rate for refrigerated trucks hit $2.46 on the spot market, the highest since July 2014, according to DAT.

The winter storm pounding its way up the East Coast this week is expected to goose freight rates, as icy conditions and blinding snow make roads treacherous, slowing deliveries.

Trucking capacity was tight through Christmas “and the rates are still high,” said Troy Cooper,

chief operating oﬃcer at XPO Logistics Inc., XPO -0.89% ▲ which has a large trucking division and brokers freight.

Mr. Cooper said demand typically slows through January and February, “so if it stays elevated, that will give you a sign,” he said.

Write to Jennifer Smith at [email protected]

Appeared in the January 6, 2018, print edition as 'Freight Rates Jump In Robust Economy.'

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