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American Trucking Associations says industry is in big trouble

Mujahideen

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#41
There are miles and miles of better places to park
Ok, tell me where?

I do this for a living damn near everyday. Some places are saturated with trucks and have little parking. Where are they supposed to park?

Most Walmart’s have even been kicking overnight trucks out.
 

D-FENZ

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#42
NOT just off the end of the on-ramp. Like I said pull up a couple of hundred yards or even a fucking mile down the highway to avoid being just off the end of the ramp.

Sounds like we're going circular here and I just might be talking to part of the problem.
 

Mr Paradise

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#43
Prime when that grocery warehouse up in Massachusetts finally gets you unloaded at 2am on a snowy February Tuesday night (appt time was 1900) and the security guard says you can’t break on their lot and you got 30 minutes left on your 14 .......just remember these four wheelers say there’s miles and miles of parking out there.

I love it when four wheelers talk trucking .....no fvcking clue.
 

mtnman

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#45
Just something I saw two weeks ago. I was on I-71 between Louisville KY and Cincinnati. Speed limit is 70mph. I'm doing 85 and just keeping up with traffic. Traffic which is mostly semi's. I'm in the fast lane because the slow lane is nothing but potholes due to heavy truck traffic. At 85mph a semi passes me on the right, he was doing at least 95mph, no big deal but...The driver had his left leg hanging out of the window and was looking at his phone. Yep they are pros. My phone does not have a camera, if it did that driver would be unemployed today.
 

Mr Paradise

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#46
Just something I saw two weeks ago. I was on I-71 between Louisville KY and Cincinnati. Speed limit is 70mph. I'm doing 85 and just keeping up with traffic. Traffic which is mostly semi's. I'm in the fast lane because the slow lane is nothing but potholes due to heavy truck traffic. At 85mph a semi passes me on the right, he was doing at least 95mph, no big deal but...The driver had his left leg hanging out of the window and was looking at his phone. Yep they are pros. My phone does not have a camera, if it did that driver would be unemployed today.
Mostly that’s a European/Canadian immigrant thing. For some reason they like that left leg up in the window. They also wear flip flops ....we don’t like them either.

I doubt he was doing 95 though ..... most trucks are governed and even if his wasn’t there’s so much truck traffic on that lane you don’t have the space to kick it open on that hilly 2 lane.
 
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Mujahideen

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#47

mtnman

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#48
Mostly that’s a European/Canadian immigrant thing. For some reason they like that left leg up in the window. They also wear flip flops ....we don’t like them either.

I doubt he was doing 95 though ..... most trucks are governed and even if his wasn’t there’s so much truck traffic on that lane you don’t have the space to kick it open on that hilly 2 lane.
I was doing 85 with HAL driving(cruise) he passed me very quickly, he was doing 95.
 

mtnman

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#49

mtnman

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Mostly that’s a European/Canadian immigrant thing. For some reason they like that left leg up in the window. They also wear flip flops ....we don’t like them either.

I doubt he was doing 95 though ..... most trucks are governed and even if his wasn’t there’s so much truck traffic on that lane you don’t have the space to kick it open on that hilly 2 lane.
He was barefoot.
 

Buck

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#52
I know what road taxes are. They are not near high enough to make up for the damage.
It MOST CERTAINLY is not from anyone underpaying on their Taxes, Sir, I assure you of that

States choose to what degree their inner city streets, local, county roads and even their own state roads are their pleasure, the Federal Highway System is not

You wanna pay more good money after bad, be my guest...it's part of what's killing that industry
 

Mujahideen

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#53
It MOST CERTAINLY is not from anyone underpaying on their Taxes, Sir, I assure you of that

States choose to what degree their inner city streets, local, county roads and even their own state roads are their pleasure, the Federal Highway System is not

You wanna pay more good money after bad, be my guest...it's part of what's killing that industry
The consumer (you) pay the taxes in the end anyway. It gets factored into the price of whatever is shipped.

If trucks are paying more, then that means you are too. I would question what’s being done with the money if the roads are bad. It’s probably in some government cronies pocket.
 

GOLDBRIX

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#54
Yeah that went out the window when the old timers started retiring and the mega carriers to keep up with demand replaced them with low wage steering wheel holders.

My very first trucking job I was lucky to make $300 a week while being away from home and my trainer didn’t teach me a god damn thing. In that situation I couldn’t even tell you what being professional was.

The only reason why I didn’t quit was because I had little else going for me but I knew from talking to the old heads that there was light at the end of the tunnel.

Took a few years to figure most of it out; now I take my job very seriously, some say too seriously. I put a lot of preparation into all my trips, but I’ve only got there by finding out what happens when you don’t.

There are a lot of truckers on the road trying to figure that part out. Most of my students I can already tell they won’t prepare as much as I do and I know that they are going to struggle and fail or smarten up.... but like I said before, the people who haven’t learned to be professional are allowed to be trainers and that’s the biggest problem that I see.
IDK about the rest of the nation but in Kentucky many OTR drivers seem to use Walmart parking lots when there is not a Truck Stop or Rest Area close.
Even small wallyworlds have big parking lots. I see RVs and trucks on the outside perimeter of that parking. Just My Observation.
 

Scorpio

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#55
Yeah that went out the window when the old timers started retiring and the mega carriers to keep up with demand replaced them with low wage steering wheel holders.

My very first trucking job I was lucky to make $300 a week while being away from home and my trainer didn’t teach me a god damn thing. In that situation I couldn’t even tell you what being professional was.

The only reason why I didn’t quit was because I had little else going for me but I knew from talking to the old heads that there was light at the end of the tunnel.

Took a few years to figure most of it out; now I take my job very seriously, some say too seriously. I put a lot of preparation into all my trips, but I’ve only got there by finding out what happens when you don’t.

There are a lot of truckers on the road trying to figure that part out. Most of my students I can already tell they won’t prepare as much as I do and I know that they are going to struggle and fail or smarten up.... but like I said before, the people who haven’t learned to be professional are allowed to be trainers and that’s the biggest problem that I see.

and sometimes shit just happens,

guy I know, been driving and hauling flats for about 40 yrs now.
pulled over out west, flat land both ways to check his load
middle of the day

a toyota something or other comes flying up on him and piles right into the back of the trailer, peeling it back and the driver like a can opener
so not only does he get to deal with that, he has to hang around wasting time while they try to clean up the mess that was made of his rig before he could roll again.
 

Mujahideen

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#56
And that’s why “parking down the highway” for the night anywhere on the shoulder isn’t even an option. The lawyers will have you for dinner and consider it lucky if your buddy avoided jail time.
 

edsl48

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#58
Trucking Recession: Heavy-Duty Truck Orders Collapse, Production Slashed, Cancellation Orders Soar

New reports from the trucking industry show the transportation recession continues to gain momentum through the end of summer, likely to continue through 2019 into 1H20.
The US trucking industry had a blockbuster year in 2018, as high demand for freight allowed transportation companies to expand fleets. But since freight demand was artificial, sparked by importers pulling forward to get ahead of tariffs, the good times were destined to end and end rather sharply.
The Institute for Supply Management's purchasing managers index plunged to 49.1 in August, the first time a contraction has been seen since 2016. Prints below 50 suggest the manufacturing economy is shrinking. Data also showed new orders dropped to a seven-year low, while the production index hit 2015 lows.


A transportation/manufacturing recession is developing, but it didn't start overnight. The first signs of a slowdown began last summer when freight rates peaked last June, and have since collapsed 20% through this year, reported The Wall Street Journal.
"There are more trucks than there are loads now," said Kyle Kottke, general manager for Kottke Trucking Inc. in Buffalo Lake, Minn.​
Production for new trucks is still elevated, as manufacturers fulfill orders placed last year, but new purchases and production volumes are starting to weaken.
According to ACT Research, heavy-duty truck orders from the four largest truck makers in North America (Daimler Trucks North America, Paccar, Volvo Trucks USA, and Navistar International) collapsed 80% in July YoY. Orders in June plunged 69% from a year earlier.

As heavy-duty truck orders collapse, suppliers, such as ones who produce transmissions have predicted that the outlook for sales this year will be horrible.
XL Specialized Trailers, a manufacturer of specialized trailers for hauling heavy things, has warned that in the last three months, orders have plummeted.
"We are planning for 2020 that is not going to be as good," said Stuart Sleper, president of XL Specialized Trailers.​
ACT Research stressed that last year's surge in trucking demand has led to overcapacity for the industry, could depress freight rates for the next several years. About 6% more capacity was brought online last year, or about 90,000 heavy-duty trucks. Production of heavy-duty trucks could reach 350,000 vehicles this year, the second-highest level since 2006.
ACT Research expects heavy-duty trucks to decline to about 238,000 vehicles next year, a production level that is more in line normal years.
"It would not take much of a weaker [gross domestic product] to send the truck industry down more," said Don Ake, vice president of commercial vehicles at transportation-equipment research group FTR.​
Ake said that manufacturers have already notified suppliers about future production cuts beginning this quarter. He expects other truck manufacturers to start slashing production by 20% by the end of the fourth quarter from current levels.

Order cancellations have already started to surge as freight companies are beginning to realize the overcapacity crisis.
Dave de Poincy, president of East Manufacturing, said the company's trailer cancellation rate jumped to 8% in late summer, compared with an average of around 1%. He expects production of trailers to drop 20% later this year.
"They don't need any more trailers right now," he said. "The flatbed industry is a real indicator of economic health."​
What's new in this report is that production cuts of heavy-duty trucks and trailers are starting as cancellation requests soar — couple this with a transportation/manufacturing recession, and the increasing possibilities of a full-blown recession could be as early as next year.
 

GOLDBRIX

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#59
I think the manufacturers need to improve or work on Just-In-Time Deliveries of vehicles. They expect their suppliers to work that way when creating these vehicles.
Cancellation of orders should not be that dramatic of an effect.
Just a few years ago the Central Kentucky area seemed to be the parking lot for over produced cars. One large lot was visible from I-75 between Lexington and Richmond. That lot has since dried up. There was another lot in Lexington used by dealers for overages. That is down to about 20-30 cars instead of the hundred +/- a few years back.

Its the economic pendulum swing. Production ramped up to high and now the pendulum has swung back and catching the manufacturers off guard.
In a year or two this panic article will be Dust in the Wind. JMHO
 

Buck

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#60
It can take a year, from the moment a truck is ordered (bought), to the moment it's delivered and special application trucks can take 18 months or longer to assemble

Lots of trucks on the road may not appear to be specially equipped, but many are, vocational trucks are not found on a local dealers lot, they need to be equipped with the customers stuff (hydraulics, special load carrying devices...)
 

edsl48

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#61
4,500 US Truckers Lose Their Jobs In August Amid Freight Recession

The US trucking industry had a blockbuster year in 2018, as high demand for freight allowed transportation companies to expand fleets. But since freight demand was artificial, sparked by importers pulling forward to get ahead of tariffs, the good times were destined to end and end rather sharply.

According to new data from the Bureau of Labor Statistics (BLS), the boom in trucking jobs could be over. More than 4,500 truckers lost their jobs in July and August as the freight industry continued trending lower.

This was the first time the BLS slashed trucking jobs since March when about 1,200 were laid off. The latest cut was the biggest since April 2018, when about 5,500 truckers lost their jobs.

Donald Broughton, principal and managing partner of research firm Broughton Capital, told FOX Business that in 1H19 nearly 640 trucking firms failed. That equates to 20,000 trucks have been pulled off the road.


In 2018, only 310 trucking companies failed, which points to an accelerating trend that could transform into a major bust cycle for the industry in 2020.

"This has to do with the spot market," American Trucking Associations chief economist Bob Costello told FOX Business. "Those fleets that are primarily in the spot market are facing volumes that are down nearly 50% and rates that are down nearly 20%."​
As previously reported, we've detailed how a freight recession continues to gain momentum through the end of summer, likely to continue through fall into 1H20.



And we've routinely pointed out that freight is a leading indicator of where the economy could be headed. At least 70% of domestic goods are moved on heavy-duty trucks, so when freight companies are cutting their workforce - it's typically the onset of an economic downturn.

As far as a downturn, the Institute for Supply Management's purchasing managers index plunged to 49.1 in August, the first time a contraction has been seen since 2016. The index printed below 50 suggests a manufacturing recession is developing. Data also showed new orders dropped to a seven-year low, while the production index hit 2015 lows. So it makes sense why trucking jobs are being slashed, it's because of manufacturing output is slowing, which requires fewer trucks to haul goods.



And to make matters worse, ACT Research warned that last year's surge in trucking demand has led to overcapacity for the industry, could depress freight rates for the next several years. About 6% more capacity was brought online last year, or about 90,000 heavy-duty trucks. Production of heavy-duty trucks could reach 350,000 vehicles this year, the second-highest level since 2006.

What's new in this report is that trucking layoffs are increasing - and it's the overall growth rate cycle downturn in employment that could start weighing on consumer sentiment and ultimately shift the economy into a full-blown recession sometime next year or the year after.
 

Joe King

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#62
The latest cut was the biggest since April 2018, when about 5,500 truckers lost their jobs.
5500 is more than 4500, yes? If so, why weren't we told to freak out about it back in '18?
Or was it just not close enough to election season for it to be used to foster fear of a recession?
 

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#64
20 2019

NWSA handles record international container volumes through July
Aug 20 2019


The Northwest Seaport Alliance reached a historic milestone in July, handling a record 1,818,221 international twenty-foot equivalent units (TEUs) year to date, a 6.2% increase from the prior year. This surpasses the previous record set in 2005 of 1,801,175 TEUs.
Total container volumes from January through July 2019 totaled 2,241,764 TEUs, a 6.4% increase from the same period in 2018. Import and export volumes grew 4.2% and 8.3%, respectively.
Total overall container volumes for July reached 326,515 TEUs, a 0.3% decrease from July 2018. International imports were down 5.5%, and exports were up 3.1%. Shipping lines canceled several sailings to manage container capacity in the trans-Pacific trade. In addition, July 2018 was an unusually robust year as shippers increased orders in advance of tariffs.
July also marked the launch of the $500 million Terminal 5 construction project in Seattle. Modernizing the 185-acre container terminal will increase the NWSA’s capacity to handle the largest container vessels serving our gateway.
Domestic volumes in July increased 4.4% over July 2018. This marked the seventh consecutive month of domestic container growth. Alaska’s year-to-date volumes were up 8%. Hawaii’s year-to-date volumes were up 3.4%.
Other cargo highlights:
  • Breakbulk cargo volumes were up 18.3% year to date to 163,650 metric tons.
  • NWSA auto volumes year to date were 97,957 units, up 24.9%.
View the July 2019 cargo reports:

https://www.nwseaportalliance.com/stats-stories/cargo-stats
 

GOLDBRIX

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#65
If traffic gets to the rails in will get to the trucks just later.
 

Scorpio

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#67
that is kind of a interesting chart above re rail,

how much was moved by truck in 2000 vs rail, as from 2000, the rail traffic overall is way down

did they move from rail to truck because of 'just in time' leading to a boom in drivers and trucks or???

would have to research all of it to try to piece it together
 

GOLDBRIX

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#68
both requiring less drivers/trucks
When was the last time a train delivered to your door ?
Long Haul may suffer, but the local drivers that like to get home every night still have HELP WANTED signs up ( In my area). YMMV
 

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#69
On railcars, 15/16 were the years that killed the PRB. We went from near full capacity to trickles out here. The two big mines could load in the neighborhood of 120,000 cars per month back in the early ‘00’s
 

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#71
i'll just add, remember, this has occurred, all by design
this is not a 'natural market cycle' or any 'economic bubble', by design, this is the destruction the the American Economy and we are discussing but one branch of the JIT Delivery Schedule, the Travel America This Summer, blah blah, that is being dismantled and this 'outcome', is generally what the plan wanted, specifically speaking, it's still got a long way to go as it's still functioning today, regardless of how many bones on the carcass we can see, it's still alive

idk if any of it can come back, so, let's plan on tomorrow:
We all travel by trains, so, there needs to be more tracks laid or cargo trains will just have to learn to share a bit better, which still means slow travel time...
Petroleum is forbidden so, everyone has an electric car, where the hell the power will come from, idk, but we all have them and our 'time compression', travel, has been greatly reduced, we can only travel within a set mileage of our home port without a charging delay...slow travel time

any trucks will be electric and on top of tire piles across the globe, we'll soon have battery piles across the globe and just wait for your favorite burrito food-truck to erupt into flames right there at the curb, as your burrito was just going in...it would seem the trailer full of batteries he needs to haul, to keep his deep fat fryer on-line, just caught on fire, all by itself...

And just wait, the newest generation of truck looks more designed to travel on Mars, than it does here on earth, might as well just let it drive itself...oh, wait

just looking forward
cool:
 

Mr Paradise

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#72
Someone actually wrote a recession scare tactic article about 4,500 truckers losing their jobs when there’s 3.5 million of us in the USA. That’s like predicting the end of the fast food industry because a couple of Long John Silvers closed up shop.

1 long haul trucker can pick up a load in LA and deliver it in Chicago 72 hours later.

Now when that same load goes by container a local driver out in LA has to pick it up and take it to the San Bernardino BNSF railyard.

A day or two later a BNSF yard driver will be assigned to move that container to the designated track and drop it off where a crane operator will “load” container on the train.

A few days later....

Train rolls into Chicago and waits for track space for “unloading” (12-24hrs)

A BNSF Chicago yard driver moves a chassis to track in preperation of unload.

A few hours later another BNSF yard driver takes container and chassis from track and drives it to designated lot assignement.

A day or two later a local driver finds container in lot, hooks up and takes load into Chicago for delivery.


1 driver vs 5 drivers

And that’s if there’s nothing wrong with the chassis on the Chicago end. If the local driver goes into the lot 2 at the Kedzie railyard and noticed he’s got a flat tire or some other mechanical problem (happens a lot) well then he has to go get a flip ticket from a railroad personnel and then go get a chassis picked from the stacks by another “driver/picker” and then drive over to the flip booth and get in line.
(2hrs later)
Another BNSF yard driver takes flip ticket and then drives over and picks up bad unit and brings back to crane area where a crane operator “flips” container from bad chassis to good chassis .....and off local goes to make delivery.

1 driver vs 6 drivers (7 if you count picker)
72hrs vs 7-10 days
 

Scorpio

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#73
why I stated the move to 'just in time' necessitated trucking, not to mention, port to port accessibility, ie sending small lots down to small locations.

whereas if time is not of the essence, then rail is cheaper per ton than truck

and doing the 1 driver vs 5,6, or 7 is plain silly, and doesn't add to the argument as all as it is apples and oranges

those trinkets being hauled around to stuff all of the treasonous retailers shelves have already spent oodles of time in the chin factory, loading dock, trucking main docking to load, then at sea for a month, then back to the next off load facility, etc. So clearly, that stuff isn't time sensitive.

months and even a year tied up and a few days difference at the end is a game changer? Not really.

then of course you have more time sensitive product, and trucks will be used to get if off the factory floor and in the field asap. Just depends on what is being discussed.

It is about efficiency of product movement vs the cost. Whatever gets the stuff from point a to b at the cheapest price.

the modern goods transportation system is a symphony, very complex, yet accomplished without a great deal of drama
 

Buck

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#75
Someone actually wrote a recession scare tactic article about 4,500 truckers losing their jobs when there’s 3.5 million of us in the USA. That’s like predicting the end of the fast food industry because a couple of Long John Silvers closed up shop.

1 long haul trucker can pick up a load in LA and deliver it in Chicago 72 hours later.

Now when that same load goes by container a local driver out in LA has to pick it up and take it to the San Bernardino BNSF railyard.

A day or two later a BNSF yard driver will be assigned to move that container to the designated track and drop it off where a crane operator will “load” container on the train.

A few days later....

Train rolls into Chicago and waits for track space for “unloading” (12-24hrs)

A BNSF Chicago yard driver moves a chassis to track in preperation of unload.

A few hours later another BNSF yard driver takes container and chassis from track and drives it to designated lot assignement.

A day or two later a local driver finds container in lot, hooks up and takes load into Chicago for delivery.


1 driver vs 5 drivers

And that’s if there’s nothing wrong with the chassis on the Chicago end. If the local driver goes into the lot 2 at the Kedzie railyard and noticed he’s got a flat tire or some other mechanical problem (happens a lot) well then he has to go get a flip ticket from a railroad personnel and then go get a chassis picked from the stacks by another “driver/picker” and then drive over to the flip booth and get in line.
(2hrs later)
Another BNSF yard driver takes flip ticket and then drives over and picks up bad unit and brings back to crane area where a crane operator “flips” container from bad chassis to good chassis .....and off local goes to make delivery.

1 driver vs 6 drivers (7 if you count picker)
72hrs vs 7-10 days
oh, my very smart friends, there so much more...every forklift is battery powered, every crane is electrically powered, cables run to it from a transformer, it has a limited range on the dock, and road calls? Every Service Truck will be weighed down with a power pack, just imagine, they will have to jump start some vehicles, but, not every day and yet, they'll be carting around that battery pack every mile, every day...the second set of equipment required just to keep this type circus going will be enormous as the shop will need to have some down time for repairs, maintenance...and we all know, this isn't going to happen, it just won't. the expenses are too high and the returns are not there

Shit Show is an understatement, complete understatement




Is that acrylic? Beautiful
I got a few wood sets, a few older stamped metal sets, i can't remember, i haven't played with them in a decade or more. they used to sit in my office, now they sit in boxes...:('

Nice Award! Duly Earned! There used to be a time, the Million Mile Truck was an industry goal, minimum maintenance, optimum up-time

Now-a-days, a $150 sensor will shut you down, an electronic time clock will shut you down, a flat tire will still shut you down but your truck and insurance payment is through the roof...fuel costs can sometimes be managed but not the cost of last years new truck, if only to comply...

I think I once told of a retro-fit kit that is available through Cummins, probably Cat and everyone else...
This Kit transforms an EPA Certified engine back into a basic computer controlled engine, your HP comes back, your power comes back...several thousand dollars later, you have a real engine that can be operated in most butt-hole countries in the world where fuel is of questionable quality...

You can not get that kit here unless you are an importer but most are just sent overseas letting the buyer perform the repairs. There are engine dealerships all over the world and they all service these motors with parts availabilities

We First Country Folks get the chance to debilitate ourselves while we pay out the pocket for the privilege to do so


and, if only because all other options have been taken away from us


Imagine that, destruction by design
and it's worse in the EU
 

Mr Paradise

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#76
Thanks Buck, I think it’s acrylic ....not 100% sure. Drive safe everyone.
 

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#77
Cass Freight Index Down 9th Month "Signaling Economic Contraction”


byMish
Updated on 5 hrs-edited

Year-over-year freight volume is down nine consecutive months starting December of 2018.
The Cass Freight Index report cites "More Signs of Contraction".
  • When the December 2018 Cass Shipments Index was negative for the first time in 24 months, we dismissed the decline as reflective of a tough comparison. In January and February 2019, we again made rationalizations. When March was also negative (-1.0%), we warned that we were preparing to “change tack” in our outlook; when April was down (-3.2%), we said, “we see material and growing downside risk to the economic outlook.”
  • With the -3.0% drop in August, following the -5.9% drop in July, -5.3% drop in June, and the -6.0% drop in May, we repeat our message from last three months: the shipments index has gone from “warning of a potential slowdown” to “signaling an economic contraction.”
  • We acknowledge that: all of these negative percentages are against extremely tough comparisons, and the Cass Shipments Index has gone negative before without being followed by a negative GDP. However, weakness in demand is being seen across most modes of transportation, both domestically and internationally, with many experiencing increases in the rates of decline.
  • We know that freight flows are a leading indicator, so by definition there is a lag between what they are predicting and when the outcome is reported. Nevertheless, we see a growing risk that GDP will go negative by year’s end.
  • The weakness in spot market pricing for many transportation services, especially trucking, is consistent with the negative Cass Shipments Index and, along with airfreight and railroad volume data, strengthens our concerns about the economy and the risk of ongoing trade policy disputes. Weakness in commodity prices, and the ongoing decline in interest rates, have all joined the chorus of signals calling for an economic contraction.

Cass asks "When Will the GDP Turn Negative?"
Year-Over-Year Drops
Those reported monthly drops are not what they may seem at first glance. They are year-over-year drops not sequential drops.
The report says "another 3% in August". It's really another month of year-over-year contraction.
Europe and Asia
  • Airfreight volumes in Europe continue to suggest that the region’s economy continues to cool.
  • Airfreight volumes in Asia suggest that the region is on the verge of, or is already entering, a recession.
  • As we’ve highlighted before, when trade tariffs slow the rate of growth for our global trading partners, it poses a real threat to the U.S. rate of economic growth.
European Airfreight



Our European Airfreight Index was down a concerning -7.2% in April, only down -2.6% in May, dropped -7.5% in June, and the July index fell -5.8%, and consistent with the deteriorating Eurozone PMI. While the -6.9% July overall drop in London airfreight volume suggests that economic headwinds from Brexit remain, particularly since the largest rates of decline (down -11% to -25%) are being experienced in the lanes between (to and from) London and other EU airports. Although the European data is by itself distressing, it’s the Asian data that has become the most alarming.​
Asia Pacific Airfreight



Asian airfreight volumes were essentially flat from June to October 2018, but have since deteriorated at an accelerating pace (November -3.5%, December -6.1%, January –5.4%, February -13.2%, March -3.6%, -10.2% in April, -8.5% in May, -7.4% in June, -6.8% July, and preliminary August -9.4%).
If the overall volume wasn’t distressing enough, the volumes of the three largest airports (Hong Kong, Shanghai, and Incheon) are experiencing the highest rates of contraction.​
Cass Shipments vs GDP



Based on the trend since the beginning of the year, but especially the data over the last four months, the Cass Shipments Index is signaling that GDP may be negative, or at least come close to being negative, in Q3. If it does not, since reported GDP often lags the economic activity represented by freight flows, continued weakness in the Cass Shipments Index at the current magnitude should result in a negative Q4 GDP.​
Dat Dry Van Trucking



The Consumer Economy - We should note that dry van trucking volume has historically been a fairly reliable predictor of retail sales (container volume serves a similar role).
When studied using the DAT Dry Van Barometer, current demand is at levels in line with capacity, which suggests that the consumer economy is still relatively healthy and that retail sales are not contracting.
That said, this is a period that seasonally should be seeing much stronger volumes, which makes us cautious about the outlook for demand in September and October.​
DAT Flatbed Trucking



The DAT Flatbed Barometer indicating that capacity exceeds demand is a negative sign for the U.S. industrial economy. In line with recent rail volumes, it has started to suggest a more bearish outlook.​
There are many more charts in the article.

Mike "Mish" Shedlock
 

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#78
Orders of Heavy Trucks Collapse, Layoffs Start
by Wolf Richter • Oct 3, 2019 • 22 Comments • Email to a friend
“Fleets are nervous. The latest manufacturing and construction numbers are concerning. The trade issue with China looms.”
Layoff decisions by heavy-truck manufacturers are trickling out. A couple of days ago, it was Daimler-owned Freightliner, which said in a statement to WBTV that it would “adjust its production output in line with lower market demand and release approximately 450 production workers [out of 2,878 employees] at its Cleveland manufacturing plant based in Cleveland, North Carolina, and approximately 450 workers [out of 1,714 employees] in Mt. Holly, North Carolina, effective October 14, 2019.” These layoffs represent 16% and 26% of the workforce at the respective plants.
Orders for heavy trucks, after a red-hot period that ended in the fall of 2018, have been in a horrific plunge. In September 2019 compared to September last year, truck makers received about 12,100 orders for Class-8 trucks, down 71% from a year ago, according to preliminary estimates by FTR Transportation Intelligence. It was the 11th month in a row of year-over-year declines, including July and August plunges of 80%:

“Fleets are moving around, or canceling orders previously placed but are not ordering many new trucks for Q4 delivery,” FTR said in the statement. “Carriers have not begun ordering for 2020 requirements yet, due to the tariffs and the economic uncertainty.”
Class-8 orders “are stuck at the bottom of the cycle,” said FTR vice president, commercial vehicles, Don Ake, adding: “Fleets are nervous. Freight growth continues to ease back. The latest manufacturing and construction numbers are concerning. The trade issue with China looms. In this environment, fleets see no reason to begin ordering for 2020 until Q4.”
The shipment boom in 2017 and 2018, as a result of front-running potential tariffs, triggered rumors of a “capacity crisis” among trucking companies, which then engaged in a historic ordering boom in 2018 to expand their capacity to be able to handle the shipment boom. But then in late 2018, overall freight shipments in the US suddenly began to fall, and have fallen ever since, and it was over.
The chart shows this boom in orders for Class-8 trucks and then the sharp drop-off in orders down to historically low levels where they appear to have gotten “stuck”:

As a result of the historic ordering boom in 2018, truck makers accumulated an equally historic backlog for building 2019 models, and the subsequent collapse in orders that started late last year was buffered by this backlog, and truck deliveries hit record highs months after orders had begun to collapse.
Truck makers recognize a sale when the truck is delivered to the customer, which is months after the truck was ordered. For the industry overall, truck sales, as measured in deliveries, surged during 2018 and into 2019, to hit 47,300 deliveries in July (seasonally adjusted), surpassing the peak before the Financial Crisis, according to data by the Commerce Department.
But in August, deliveries fell, and in September deliveries fell again, to 41,800 (seasonally adjusted), down 4.6% from September last year, the first year-over-year decline since the March 2017. These deliveries are still all 2019 models for which orders closed some time ago:

Truck makers don’t disclose their order backlogs. But when production cuts and layoffs start, it’s safe to assume that much of the order backlog has been built and delivered. Now deliveries are declining, and the layoffs are starting.
This is likely what is happening at Freightliner, where layoffs are set to begin on October 14. The company said in its statement to WBTV, referring to the order boom last year, and its untimely end:
This levelling-off in the market requires us to adjust our production levels to meet the normalized demand and therefore reduce our current build rates and employment levels at these locations. We have already witnessed some of our industry competitors making changes in their production plans and employment levels to accommodate.​
Daimler also owns Western Star, and their industry competitors are Peterbilt and Kenworth, divisions of Paccar [PCAR]; Navistar International; and Mack Trucks and Volvo Trucks, divisions of Volvo Group. Navistar already announced layoffs in its medium-duty truck division.
What’s next for truck makers? Note Freightliner’s description of “normalized demand.” This is probably an accurate description of a market that had been totally distorted by the tariff-frontrunning boom, and now struggles with the harsh return to “normal.” The cyclicality of this industry is legendary, but even for this cyclical industry, the ordering boom in 2018 and the current order collapse is extreme.
As the backlog dwindles further, there will be further production cuts and layoffs until capacity is roughly in line with incoming demand for trucks.
The level of orders over the past five months in the 10,000 to 13,000-unit range is catastrophically low – about half of the industry capacity – and is likely a counter-reaction to the boom. At some point, the excesses will be worked off, and this catastrophically low level of orders will tick higher. But the cloud 9 that truck makers had been on until summer this year will likely not return anytime soon.
 

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#79
So like most things, it’s cyclical.
 

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#80
$4 per gallon Diesel fuel will only exacerbate this cycle.