FreightWaves Today

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The Department of Transportation is escalating its battle against "CDL mills" accused of certifying unqualified drivers, promising to eliminate unsafe operators and investigate fleets that hire them. This heightened regulatory enforcement is already leading to a significant capacity shakeout in the truckload market, which could potentially overshadow Schneider’s tough Q3 earnings report.

DOT Secretary Sean Duffy is expanding driver enforcement to shippers who load up rigs, warning that companies must ensure truck drivers meet federal English language proficiency rules or face substantial penalties. This focus on language compliance follows the sidelining of more than 7,000 truckers reportedly for English proficiency violations due to a revived out-of-service criterion this year.

Meanwhile, UPS announced that 2,000 drivers left UPS after taking buyouts in the third quarter, part of a major streamlining campaign that has eliminated 48,000 jobs over the past 18 months. Across the industry, TFI International reported mixed signs of a turnaround at TFI’s U.S. LTL operations, showing flat year-over-year operating ratios and decreased operating income across all major segments.

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Transportation Secretary Shawn Duffy announced a major new initiative this week, ramping up efforts to crack down on fraudulent CDL mills and unsafe drivers after increased roadside inspections led to over 7,000 service violations. The Department of Transportation is now focusing on the integrity of the certification process and plans to investigate both driver training programs and trucking companies that hire drivers with questionable credentials, holding them accountable for safety standards.

LTL carrier XPO continues to defy the soft market cycle, reporting significant margin improvement in its LTL segment during the third quarter. The company achieved an 82.7% operating ratio for the quarter by leveraging a variety of pricing levers and implementing AI optimization initiatives.

Parcel analyst Satish Jindel estimates that approximately 2,000 unionized delivery drivers accepted a voluntary separation package offered by UPS during the third quarter. These buyouts, which cost the company $175 million and offered severance packages of $1,800 per year of service, were part of a major streamlining campaign intended to align capacity with lower volumes.

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The Great Freight Recession continues its relentless purge in the carrier sector, claiming Illinois-based VIB Trans, a 29-truck carrier, as the latest casualty to file for Chapter 11 amid deeply depressed spot rates and relentlessly high operating costs. This pain is accelerating due to an 18% drop in freight volumes coupled with immense overcapacity, driven by 310,000 new trucks and 200,000 new CDLs added to the system since 2019.

Strategic experts are anticipating the Largest capacity purge in history coming as new regulations tighten enforcement around non-domiciled CDLs and ELP requirements. This regulatory squeeze could eliminate up to 600,000 active drivers from the system, potentially leading to sharp volatility spikes and market rationalization that ultimately benefits surviving carriers with higher pay and increased freight rates.

While carriers fight for survival, the brokerage world is thriving, C.H. Robinson again is strong, and Wall Street throws roses after the company posted extremely strong third-quarter performance, including a 22.6% increase in income from operations. C.H. Robinson’s core North American Surface Transport segment successfully grew combined truckload and LTL volume by 3%, demonstrating significant market share growth against a declining industry benchmark.

In strategic updates, UPS is reversing its costly insourcing strategy for low-budget shipments, tentatively agreeing to UPS, Postal Service to reunite for delivery of low-budget shipments via the USPS last-mile network. This reversal acknowledges that UPS's internal cost structure struggled to compete, especially after Ground Saver volume plummeted nearly 33% year-over-year.

Internationally, the U.S. and China suspended punitive reciprocal fees on docking ships for one year amid trade talks, which were originally imposed to revive U.S. shipbuilding. Plus, we cover immediate executive changes at CSX as CEO Steve Angel switches up leadership, naming Kevin Boone CFO and promoting Mary Clare Kenny to Chief Commercial Officer.

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VIB Trans, an Illinois-based carrier with 29 trucks, has filed for Chapter 11 bankruptcy amidst the long-running "Great Freight Recession" .

Brokerage giant C.H. Robinson showed robust profitability for the third quarter, which sent its shares soaring 20% right after the earnings release . The company saw income from operations jump 22.6% and adjusted gross profit for its core North American Surface Transport segment rise 5.6% year-over-year .

We examine the tentative agreement reached between UPS and the U.S. Postal Service to resume last-mile parcel delivery for UPS’s low-cost Ground Saver shipping service . This strategic move is part of a multi-pronged effort at UPS to reduce costs, patching up a relationship that had previously dissolved in 2024 over rate hikes on the final mile component .

Stick around for more content later today, including a new episode of The Long Haul featuring Tyler Harden of TTN Solutions and Natasha Sanders of Amazon Freight Partner. Plus, listen to Freightonomics, where Henry Byers and Jared Flinn join the conversation to discuss what's currently happening in the freight market.

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The freight market is at a "pivotal moment" as shifting industry narratives meet long-overdue regulatory action and the harsh realities of a capacity glut. Hear how the ATA executed a stunning tactical retreat on their decades-long "truck driver shortage" claim, now admitting the problem is a "shortage of quality drivers" rather than quantity.

This retreat coincides with federal regulators moving to fix a self-created crisis: the DOT issued an emergency rule restricting non-domiciled CDLs that were improperly granted to at least 200,000 non-U.S. residents since March 2019. This massive influx of drivers fueled the "Great Freight Recession," yet real inflation-adjusted truck driver wages have only increased minimally since 2010.

We examine the brutal financial impact of overcapacity, including Pamt Corp.’s fourth consecutive quarterly net loss and its unsustainable 106.7% adjusted operating ratio for its truckload unit. Conversely, Landstar System's mixed results showed strong flatbed trends and the first sequential increase in its exclusive carrier base since 2022, potentially signaling a slow market turn as regulatory changes threaten to remove 200,000 owner-operators from the pool.

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Truckload carrier Pamt Corp. books another loss in Q3, reporting a net loss of $5.6 million for the third quarter, marking its fourth consecutive net loss in a market that continues to hammer the freight industry. The company's consolidated revenue dropped 18% year-over-year, and its truckload unit reported a tough 106.7% operating ratio, exacerbated by its high reliance on the tariff-hampered auto industry.

In contrast, Flatbed trends buttress Landstar amid dry van slump, as the company reported strong flatbed volumes even though dry van freight demand remains soft. Landstar reported adjusted earnings per share of $1.22, just one cent shy of consensus estimates, and management noted that potential regulation-induced capacity crunch on the owner-operator population may signal a future market flip.

Also covered today, Port Houston completes ship channel dredging amid environmental scrutiny, finalizing its share of the $1 billion Houston Ship Channel Expansion (Project 11) to widen the waterway to 700 feet through Galveston Bay. Port CEO Charlie Jenkins confirmed the project is already delivering measurable gains, improving safety and reducing vessel emissions by allowing ships to move more efficiently through one of the nation’s busiest waterways.

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DAT, a subsidiary of Roper Technologies, is evolving into an automated, AI-powered freight marketplace, a transformation discussed by executives at the FreightWaves F3 and on the Roper earnings call. This strategic shift is predicated on a series of key acquisitions, including the Convoy tech stack, Trucker Tools, and Outgo, which aim to build capabilities across the entire freight automation workflow, promising savings of $100–$200 per load. 

We dive into the immediate crisis caused by federal attempts to restrict non-domiciled CDLs, a pool that has added over 200,000 licenses since 2019, contributing to the "Great Freight Recession". The U.S. Postal Service’s sudden ban on these drivers led to immediate, severe service disruptions and a rapid reversal, highlighting the supply chain's critical reliance on this driver segment. 

The program features an update on Union Pacific’s aggressive campaign to secure approval for its $85 billion acquisition of Norfolk Southern, a merger that would create the first U.S. transcontinental freight railroad. This campaign includes strategic political maneuvering, such as a donation to President Trump's White House ballroom project and securing job guarantee backing from its largest labor union.

In air cargo news, we cover Kalitta Air's deployment of the first-ever Boeing 777 converted freighters, dubbed the "Big Twin," for dedicated customers like DHL Express and Challenge Group, leveraging their increased volume and fuel efficiency. Finally, we examine Marten Transport's third-quarter earnings, which saw overall profitability maintained despite a loss in the Truckload segment, and discuss how the U.S. reached a trade framework with China even while tensions flared with Canada over a new 10% tariff increase. 

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The US and China have reached a framework for a new trade agreement, potentially averting the threatened 100% tariff on Chinese imports, even as the U.S. has raised tariffs on Canada by 10%.

Accucold has launched a new dual compressor combination refrigerator and freezer designed specifically for the life science, healthcare, and pharmaceutical sectors. These new models, available in two widths, feature independent temperature control across multiple compartments and include user-focused safety features like audible and visual alarms that alert users to temperature excursions, power loss, or door openings.

The freight industry is closely monitoring the potential for a severe capacity crunch following increased enforcement of non-domiciled CDL issuance nationwide. FreightWaves founder and CEO Craig Fuller suggests that the emergency rule addressing the improper granting of at least 200,000 non-domiciled CDLs will lead to a significant tightening of truckload capacity across the United States.

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