<div class="phx-topic abstract-wrapper">Pacific International Lines' traffic in US imports from Asia rose 67 percent year over year in the second quarter.</div>

Pacific International Lines' traffic in US imports from Asia rose 67 percent year over year in the second quarter.

<div>Pacific International Lines' strong financial position relative to other independent ocean carriers makes it a possible target for takeover.Pacific International Lines (PIL) is the next most likely takeover target in the fast-consolidating container shipping industry following <a>last week’s $6.3 billion sale</a> of Hong Kong’s OOCL to China Cosco Shipping, with the Chinese carrier seen as the most likely suitor for the Singapore-based company, according to maritime analyst Alphaliner. PIL wasn't immediately available for comment. The OOCL deal has left just four independent mid-scale carriers, each with market shares of between 1.5 percent and 2.8 percent, the industry analyst said. In...

Pacific International Lines' strong financial position relative to other independent ocean carriers makes it a possible target for takeover. Pacific International Lines (PIL) is the next most likely takeover target in the fast-consolidating container shipping industry following last week’s $6.3 billion sale of Hong Kong’s OOCL to China Cosco Shipping, with the Chinese carrier seen as the most likely suitor for the Singapore-based company, according to maritime analyst Alphaliner. PIL wasn't immediately available for comment. The OOCL deal has left just four independent mid-scale carriers, each with market shares of between 1.5 percent and 2.8 percent, the industry analyst said. In the market for US imports from Asia, PIL had a market share of 1.5 percent in the second quarter, when the new global container shipping alliances launched, up 0.6 percentage points year over year, according to PIERS, a sister unit of JOC.com. PIL’s volume on the trade rose 67 percent in the same period to 58,407 TEU. Click to Enlarge Three of the carriers — Yang Ming, Hyundai Merchant Marine, and Zim Integrated Shipping Services — are government-linked, which makes them unlikely takeover targets outside their home nations of Taiwan, Korea, and Israel. The carriers’ cash-strapped status will further deter potential buyers, Alphaliner suggested. Yang Ming is in the midst of a recapitalization program mainly supported by the Taipei government, while HMM and Zim were financially restructured in 2016 and 2014 , with their creditors acquiring significant stakes via debt-for-equity deals. “This leaves PIL as the only unencumbered candidate, and its niche position, in particular, on Africa-related trades, could make the carrier an attractive target for buyers keen on securing access to this emerging market,” Alphaliner said. Unlike its counterparts, PIL recently had to raise cash from asset disposals and provide collateral to secure bank loans to settle its outstanding debt. PIL is said to have sold two 2012-built capsize bulk carriers this year for just $26 million to 28 million apiece, taking a significant loss, and has pledged its shares in Singamas, the Hong Kong-listed container manufacturer in which it has a 41.1 percent stake, to raise bank loans of around $180 million. The proceeds from the sale of the bulk ships were used to pay off S$300 million ($219 million) of bonds due on July 17. PIL is obliged to sell its Singamas shareholding within 20 months for at least $180 million or at a price acceptable to its creditors, according to a stock exchange filing by the Hong Kong-based company on July 11. PIL, which is controlled by the Chang Teo family, does not publish regular financial reports, but it posted a significant net loss in 2016, due to “very low freight rates and a one-off bunker hedging loss” in the first half of the year. The company carries a total debt of more than $2.6 billion, according to Alphaliner. PIL has a close strategic alliance with Cosco, built up over recent years — it established a partnership with the Chinese carrier on the west and east Africa trades in 2016 and earlier this year signed a vessel sharing deal with Cosco and Wan Hai on the trans-Pacific trade. The carrier is due to take on the first of 12 new Chinese-built and financially-backed 11,800-TEU ships later this year and is expected to “rely heavily” on Cosco to find work for the new vessels, which are targeted at the trans-Pacific trades, including a planned entry into the US East Coast market in 2018. PIL and the other independent carriers have so far limited their efforts in the trans-Pacific to the US West Coast, but SM Line also plans to enter the US East Coast trade next year. Contact Bruce Barnard at brucebarnard47@hotmail.com .

Container lines

PIL seen as next takeover target after OOCL

<div class="phx-topic abstract-wrapper">The fifth largest freight broker in the US will absorb FreightSaver, which like Echo, focuses on managed transportation services for shippers. </div>

The fifth largest freight broker in the US will absorb FreightSaver, which like Echo, focuses on managed transportation services for shippers.

Feature image

<div class="phx-topic">Freight broker Echo Global Logistics on Monday acquired Southern California-based third-party logistics (3PL) provider FreightSaver for an undisclosed sum, broadening Echo’s West Coast and Midwest presence amid a long-term malaise in the US domestic freight market. The deal will see Echo incorporate FreightSaver’s offices in Utah, Michigan, Ohio, and California. Founded in 2014 by logistics veterans Ryan Renne and Buster Schwab, FreightSaver offers truckload, less-than-truckload (LTL), expedited, specialized freight and managed transportation services. ”FreightSaver has built a customer-centric, tech-enabled business that complements our strengths and accelerates our ability to deliver value through managed transportation,“ Echo CEO Doug Waggoner said in a statement. Echo is the fifth largest US freight broker, with roughly $3 billion in revenue in 2024, according to analyst Armstrong &amp; Associates. It was <a href="https://www.joc.com/article/echo-deal-pushes-private-equity-deeper-into-logistics-5248085">taken private in 2021</a> by private equity group The Jordan Company in a $1.3 billion transaction. Merger and acquisition activity in the brokerage market has slowed since a feverish period in the pandemic, culminating in <a href="https://www.joc.com/article/rxo-purchase-of-coyote-logistics-highlights-us-brokerage-market-pressures-5192296">RXO’s $1 billion purchase of Coyote Logistics</a> in June 2024. <a href="https://www.joc.com/article/jb-hunt-brokerage-acquisition-deepens-partnership-with-bnsf-5215664">J.B. Hunt acquired BNSF Logistics’ brokerage division</a> in June 2023, while <a href="https://www.joc.com/article/uber-freight-to-buy-transplace-for-225-billion-5249247">Uber Freight acquired Transplace</a> and <a href="https://www.joc.com/article/molo-wants-to-catch-ch-robinson-via-arcbest-ramp-5247241">ArcBest Acquired MoLo Solutions</a> in 2021. Both truckload and LTL pricing have been under long-term pressure, due in part to overcapacity in the truckload market and diminished demand in the LTL market. Brokers are also <a href="https://www.joc.com/article/truckload-brokers-eye-human-technology-balance-as-ai-takes-hold-5876340">under pressure to use technology</a> — and, in particular, automation — to be more operationally efficient to preserve margin amid that low rate environment. "Echo brings the scale, resources, and vision to expand the value we deliver to our clients,” Schwab, FreightSaver’s president, said in the statement. "Together, we're positioned to deliver smarter logistics with a powerful combination of people and technology." Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

Freight broker Echo Global Logistics on Monday acquired Southern California-based third-party logistics (3PL) provider FreightSaver for an undisclosed sum, broadening Echo’s West Coast and Midwest presence amid a long-term malaise in the US domestic freight market. The deal will see Echo incorporate FreightSaver’s offices in Utah, Michigan, Ohio, and California. Founded in 2014 by logistics veterans Ryan Renne and Buster Schwab, FreightSaver offers truckload, less-than-truckload (LTL), expedited, specialized freight and managed transportation services. ”FreightSaver has built a customer-centric, tech-enabled business that complements our strengths and accelerates our ability to deliver value through managed transportation,“ Echo CEO Doug Waggoner said in a statement. Echo is the fifth largest US freight broker, with roughly $3 billion in revenue in 2024, according to analyst Armstrong & Associates. It was taken private in 2021 by private equity group The Jordan Company in a $1.3 billion transaction. Merger and acquisition activity in the brokerage market has slowed since a feverish period in the pandemic, culminating in RXO’s $1 billion purchase of Coyote Logistics in June 2024. J.B. Hunt acquired BNSF Logistics’ brokerage division in June 2023, while Uber Freight acquired Transplace and ArcBest Acquired MoLo Solutions in 2021. Both truckload and LTL pricing have been under long-term pressure, due in part to overcapacity in the truckload market and diminished demand in the LTL market. Brokers are also under pressure to use technology — and, in particular, automation — to be more operationally efficient to preserve margin amid that low rate environment. "Echo brings the scale, resources, and vision to expand the value we deliver to our clients,” Schwab, FreightSaver’s president, said in the statement. "Together, we're positioned to deliver smarter logistics with a powerful combination of people and technology." Contact Eric Johnson at eric.johnson@spglobal.com .

Surface

Trucking News

Truck brokers

Echo acquires California 3PL amid flagging US freight market

<div class="phx-topic abstract-wrapper">Taiwan-based ocean carriers say US tariffs are taking a toll on trans-Pacific volumes.</div>

Taiwan-based ocean carriers say US tariffs are taking a toll on trans-Pacific volumes.

<div class="phx-topic">Two of Taiwan’s big three carriers, Yang Ming Marine Transport and Wan Hai Lines, saw a second-quarter net profit slump due to weaker cargo volumes amid uncertainty over ongoing trade negotiations. Yang Ming’s second-quarter profitability was also hit by a tax on undistributed earnings, the carrier said in a statement announcing its results Tuesday. Analysts estimated the tax liability at about $100 million based on pre-tax figures in previous quarters. Commenting on current market conditions, Yang Ming said there are wide variations across different trade lanes. The trans-Pacific has been negatively impacted by uncertainty over US tariffs, despite the traditional summer peak season, the carrier said in the results statement. Asia-Europe and Asia-Mediterranean trades are expected to remain positive. Intra-Asia demand is steady, whereas Asia-Australia, Asia-Latin America, and other segments require close monitoring for market volatility, Yang Ming said. Vessel diversions via the Cape of Good Hope are partially absorbing excess container ship capacity, which is expected grow 6% this year, the carrier said quoting Drewry and Alphaliner figures. Drewry is forecasting demand growth of 2%, while Alphaliner is estimating 2.7% growth, Yang Ming added. “Drewry also foresees softer market conditions in the second half due to front-loaded shipments in the first half,” Yang Ming’s statement added. Yang Ming, Taiwan’s second-largest carrier behind Evergreen and ranked 10th largest globally by Alphaliner, saw net profit slump to $31 million in the second quarter, down from $259 million in the first quarter and $436 million in the second quarter last year. Second-quarter revenues dropped 27% to $1.2 billion from $1.7 billion in the year prior. Figures show revenues also fell 16% quarter over quarter from $1.4 billion in the first quarter. Separately, intra-Asia-focused Wan Hai Lines also saw second-quarter net profit slump to $41 million compared with $286 million in the first quarter and $142 million in the second quarter last year, based on an analysis of a Taiwan stock exchange filing Monday. Quarter-over-quarter revenue was unchanged at $1.2 billion, although second quarter revenue increased 9% compared with $1.1 billion in the prior year. Evergreen will file its interim results with the Taiwan stock exchange Wednesday. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. </div>

Two of Taiwan’s big three carriers, Yang Ming Marine Transport and Wan Hai Lines, saw a second-quarter net profit slump due to weaker cargo volumes amid uncertainty over ongoing trade negotiations. Yang Ming’s second-quarter profitability was also hit by a tax on undistributed earnings, the carrier said in a statement announcing its results Tuesday. Analysts estimated the tax liability at about $100 million based on pre-tax figures in previous quarters. Commenting on current market conditions, Yang Ming said there are wide variations across different trade lanes. The trans-Pacific has been negatively impacted by uncertainty over US tariffs, despite the traditional summer peak season, the carrier said in the results statement. Asia-Europe and Asia-Mediterranean trades are expected to remain positive. Intra-Asia demand is steady, whereas Asia-Australia, Asia-Latin America, and other segments require close monitoring for market volatility, Yang Ming said. Vessel diversions via the Cape of Good Hope are partially absorbing excess container ship capacity, which is expected grow 6% this year, the carrier said quoting Drewry and Alphaliner figures. Drewry is forecasting demand growth of 2%, while Alphaliner is estimating 2.7% growth, Yang Ming added. “Drewry also foresees softer market conditions in the second half due to front-loaded shipments in the first half,” Yang Ming’s statement added. Yang Ming, Taiwan’s second-largest carrier behind Evergreen and ranked 10th largest globally by Alphaliner, saw net profit slump to $31 million in the second quarter, down from $259 million in the first quarter and $436 million in the second quarter last year. Second-quarter revenues dropped 27% to $1.2 billion from $1.7 billion in the year prior. Figures show revenues also fell 16% quarter over quarter from $1.4 billion in the first quarter. Separately, intra-Asia-focused Wan Hai Lines also saw second-quarter net profit slump to $41 million compared with $286 million in the first quarter and $142 million in the second quarter last year, based on an analysis of a Taiwan stock exchange filing Monday. Quarter-over-quarter revenue was unchanged at $1.2 billion, although second quarter revenue increased 9% compared with $1.1 billion in the prior year. Evergreen will file its interim results with the Taiwan stock exchange Wednesday. Contact Keith Wallis at keithwallis@hotmail.com .

Maritime

Container Shipping News

Yang Ming, Wan Hai profits drop on weaker volumes

<div class="phx-topic abstract-wrapper">US tariffs are fuel cost-cutting mandates, heaping pressure on cargo owners to push for lower ocean shipping rates even if at the expense of carrier relations. </div>

US tariffs are fuel cost-cutting mandates, heaping pressure on cargo owners to push for lower ocean shipping rates even if at the expense of carrier relations.

<div class="phx-topic">A combination of factors that includes shippers’ hunger to lower costs in the face of the highest US tariffs in decades and a growing supply-demand imbalance are raising the specter of worsening shipper-carrier relations. In the near term, shippers operating under strict cost-cutting mandates could, for example, begin diverting contracted cargo to a lower-priced spot market. In the long term, this dynamic could result in shippers walking away from established carrier and forwarder partnerships in pursuit of marginally lower rates. “The pressure is immense already,” Mark Chadwick, president of the Global Shippers Association, told the Journal of Commerce. “With margins squeezed because of tariffs and nearshoring expenses, many CFOs are pushing their procurement teams to lower other costs, with logistics certainly on the list.” M. Can Fidan, executive vice president at forwarder MTS Logistics, said some shippers are still motivated in part by the record rates seen during the COVID-19 pandemic. “[Some] importers are always looking for lower prices, but I think now they have the appetite to push carriers, or maybe to switch to other carriers, after experiencing what they saw as unfair price increases during COVID-19 from longstanding carrier partners,” Fidan said. Those opportunities to drive down costs may well present themselves; analysts expect new vessel arrivals to tip the market into overcapacity next year, despite factors such as Red Sea diversions, port congestion in Asia and Europe, and alliance reshuffling that worked in carriers’ favor this year. JP Morgan said on Aug. 11 that “steep losses into 2026–27 [are] unavoidable” for Maersk, reflecting a deteriorating freight rate environment for the wider industry. It’s a familiar dynamic in container shipping. One party takes advantage of favorable market forces but in doing so sets itself up for future retaliation when the market turns against them. “The same bosses who are demanding a 10% reduction in your ocean spend now are the ones who are going to be screaming when you can’t get space on a ship,” Chadwick said. “There are many companies for whom air cargo is not a viable alternative, so if they can’t get access to ocean freight, it could be game over.” Shippers will no doubt recall that, in tight markets over the five-plus years since the beginning of the pandemic, carriers sought to maximize revenue, leaving lower-priced yet contracted cargo behind, improving their profitability but hurting customers’ supply chains in the process. They will remember how carriers aggressively use blank sailings and other capacity-restricting tools to support the market, the effect of which for shippers is longer transit times, higher inventory costs and revenue impact. “Even if you tell a customer today, ‘You know this x carrier took care of us during that time,’ they’ll say, ‘Yeah, I know, but they didn’t do it because they love me. They do it because I paid them the highest rate, right? So now, why do I need to support them when they need me?,’” Fidan said. <h3>History, repeated </h3>Shippers, for their part, had the opportunity to turn the tables in 2022 and 2024, when the market collapsed, and they are poised to do it again. Trans-Pacific spot rates have plunged more than 70% to the West Coast and 61% to the East Coast since mid-June, when China cargo was unleashed after the temporary easing of 145% tariffs. There are early signs that cost pressures are leading some shippers to seek out lower spot rates, even when failing to fulfill contracted minimum quantity commitments (MQCs). In other words, market forces may yet again overwhelm relationships, partnerships and any semblance of win-win value creation in the container supply chain. Even some shippers are warning that overly aggressive cost-cutting could come back to bite them when the market tightens. This is seen as inevitable given the current environment, characterized by repeated capacity shocks due to external forces and a consolidated carrier industry ready to take advantage. “It’s important for shippers to avoid the temptation of compromising commitments to their carrier partners in exchange for these relatively small, short-term gains,” Chadwick said. “Given the turmoil in international trade, some shippers won’t have the volume to meet their MQCs and should be upfront with the carriers about this, so that they can plan space utilization accordingly. But it’s a different story when that MQC’s missed because the shipper’s chasing an off contract alternative that’s slightly lower cost. “We need to protect the goodwill that we’ve been earning with the carriers, standing by our commitments so that we can expect the same when the market flips again,” he added. <h3>Lessons learned? </h3>But market forces will, as they have many times in the past, exert powerful pressures that undermine partnership. These include the intense margin pressure shippers are under when attempting to mitigate the impact of US tariffs, which are above 18% now on average, up from 2.4% last year and the highest level since the 1930s. Those pressures also include the wave of new vessels currently being delivered to carriers that will result in increasingly attractive rates being shopped to beneficial cargo owners. “We expect [rates] to continue to decline on a widening demand-supply imbalance,” JP Morgan wrote following Maersk’s second-quarter earnings report on Aug. 7. Chadwick said carriers are already floating “low-ball offers,” and this trend will likely accelerate through the end of 2025 and into 2026 as carriers and forwarders look to maintain volumes. “We know to expect the unexpected, so a lot could happen that could quickly reverse this trend, another reason to stay focused on being good partners to our carriers,” he said. Shippers will try different tactics to get away with shipping under lower spot rates while preserving carrier relationships, an increasingly important priority for them given there are fewer carriers available due to consolidation. They will argue, for example, that manufacturing or other delays prevent them fulfilling MQCs, an excuse carriers may accept to the extent the market is weak, and the carrier itself wants to preserve the relationship with the shipper in the upcoming contract cycle. A question hanging over the market is how much carriers learned over the past five years to maximize their advantage, specifically about limiting capacity in various ways when facing soft market conditions, or whether carriers will return to predatory practices of raiding each other’s cargo base just to fill their ships. “For the next few months, you will see carriers blanking capacity because I do think they realize the party is over and they brought in too much capacity this spring,” said Sanjay Tejwani, CEO of consulting firm 365 Logistics. “But that said, they have been pretty good in reacting, and they will react again, pulling capacity out and creating a stable market. Contact Peter Tirschwell at <a href="mailto:peter.tirschwell@spglobal.com">peter.tirschwell@spglobal.com</a>. </div>

A combination of factors that includes shippers’ hunger to lower costs in the face of the highest US tariffs in decades and a growing supply-demand imbalance are raising the specter of worsening shipper-carrier relations. In the near term, shippers operating under strict cost-cutting mandates could, for example, begin diverting contracted cargo to a lower-priced spot market. In the long term, this dynamic could result in shippers walking away from established carrier and forwarder partnerships in pursuit of marginally lower rates. “The pressure is immense already,” Mark Chadwick, president of the Global Shippers Association, told the Journal of Commerce. “With margins squeezed because of tariffs and nearshoring expenses, many CFOs are pushing their procurement teams to lower other costs, with logistics certainly on the list.” M. Can Fidan, executive vice president at forwarder MTS Logistics, said some shippers are still motivated in part by the record rates seen during the COVID-19 pandemic. “[Some] importers are always looking for lower prices, but I think now they have the appetite to push carriers, or maybe to switch to other carriers, after experiencing what they saw as unfair price increases during COVID-19 from longstanding carrier partners,” Fidan said. Those opportunities to drive down costs may well present themselves; analysts expect new vessel arrivals to tip the market into overcapacity next year, despite factors such as Red Sea diversions, port congestion in Asia and Europe, and alliance reshuffling that worked in carriers’ favor this year. JP Morgan said on Aug. 11 that “steep losses into 2026–27 [are] unavoidable” for Maersk, reflecting a deteriorating freight rate environment for the wider industry. It’s a familiar dynamic in container shipping. One party takes advantage of favorable market forces but in doing so sets itself up for future retaliation when the market turns against them. “The same bosses who are demanding a 10% reduction in your ocean spend now are the ones who are going to be screaming when you can’t get space on a ship,” Chadwick said. “There are many companies for whom air cargo is not a viable alternative, so if they can’t get access to ocean freight, it could be game over.” Shippers will no doubt recall that, in tight markets over the five-plus years since the beginning of the pandemic, carriers sought to maximize revenue, leaving lower-priced yet contracted cargo behind, improving their profitability but hurting customers’ supply chains in the process. They will remember how carriers aggressively use blank sailings and other capacity-restricting tools to support the market, the effect of which for shippers is longer transit times, higher inventory costs and revenue impact. “Even if you tell a customer today, ‘You know this x carrier took care of us during that time,’ they’ll say, ‘Yeah, I know, but they didn’t do it because they love me. They do it because I paid them the highest rate, right? So now, why do I need to support them when they need me?,’” Fidan said. History, repeated Shippers, for their part, had the opportunity to turn the tables in 2022 and 2024, when the market collapsed, and they are poised to do it again. Trans-Pacific spot rates have plunged more than 70% to the West Coast and 61% to the East Coast since mid-June, when China cargo was unleashed after the temporary easing of 145% tariffs. There are early signs that cost pressures are leading some shippers to seek out lower spot rates, even when failing to fulfill contracted minimum quantity commitments (MQCs). In other words, market forces may yet again overwhelm relationships, partnerships and any semblance of win-win value creation in the container supply chain. Even some shippers are warning that overly aggressive cost-cutting could come back to bite them when the market tightens. This is seen as inevitable given the current environment, characterized by repeated capacity shocks due to external forces and a consolidated carrier industry ready to take advantage. “It’s important for shippers to avoid the temptation of compromising commitments to their carrier partners in exchange for these relatively small, short-term gains,” Chadwick said. “Given the turmoil in international trade, some shippers won’t have the volume to meet their MQCs and should be upfront with the carriers about this, so that they can plan space utilization accordingly. But it’s a different story when that MQC’s missed because the shipper’s chasing an off contract alternative that’s slightly lower cost. “We need to protect the goodwill that we’ve been earning with the carriers, standing by our commitments so that we can expect the same when the market flips again,” he added. Lessons learned? But market forces will, as they have many times in the past, exert powerful pressures that undermine partnership. These include the intense margin pressure shippers are under when attempting to mitigate the impact of US tariffs, which are above 18% now on average, up from 2.4% last year and the highest level since the 1930s. Those pressures also include the wave of new vessels currently being delivered to carriers that will result in increasingly attractive rates being shopped to beneficial cargo owners. “We expect [rates] to continue to decline on a widening demand-supply imbalance,” JP Morgan wrote following Maersk’s second-quarter earnings report on Aug. 7. Chadwick said carriers are already floating “low-ball offers,” and this trend will likely accelerate through the end of 2025 and into 2026 as carriers and forwarders look to maintain volumes. “We know to expect the unexpected, so a lot could happen that could quickly reverse this trend, another reason to stay focused on being good partners to our carriers,” he said. Shippers will try different tactics to get away with shipping under lower spot rates while preserving carrier relationships, an increasingly important priority for them given there are fewer carriers available due to consolidation. They will argue, for example, that manufacturing or other delays prevent them fulfilling MQCs, an excuse carriers may accept to the extent the market is weak, and the carrier itself wants to preserve the relationship with the shipper in the upcoming contract cycle. A question hanging over the market is how much carriers learned over the past five years to maximize their advantage, specifically about limiting capacity in various ways when facing soft market conditions, or whether carriers will return to predatory practices of raiding each other’s cargo base just to fill their ships. “For the next few months, you will see carriers blanking capacity because I do think they realize the party is over and they brought in too much capacity this spring,” said Sanjay Tejwani, CEO of consulting firm 365 Logistics. “But that said, they have been pretty good in reacting, and they will react again, pulling capacity out and creating a stable market. Contact Peter Tirschwell at peter.tirschwell@spglobal.com .

Transport, Trade and Regulation News

Shipper cost pressures risk further fraying carrier relationships

<div class="phx-topic abstract-wrapper">OOCL’s newest express shuttle service from China to Mexico joins other carrier services linking the two and underscores the ongoing growth in trade between the two countries. </div>

OOCL’s newest express shuttle service from China to Mexico joins other carrier services linking the two and underscores the ongoing growth in trade between the two countries.

<div class="phx-topic">Orient Overseas Container Line (OOCL) later this month will begin offering a trans-Pacific express service to Mexico’s West Coast, adding to the list of new ocean services that have sprung up as China reorients its trade networks. OOCL said Monday that its Trans-Pacific Latin Pacific 8 (TLP8) service will start with an Aug. 20 departure from Shanghai. The TLP8’s Asia rotation covers Shanghai and Qingdao, and the eastbound voyage includes Mexico’s Ensenada and Manzanillo, along with a westbound call at Yokohama. The TLP8 is offering 17-day transit between Qingdao and Ensenada. The Port of Ensenada has one berth capable of handling post-Panamax ships up to 6,000 TEUs in capacity. The TLP8 joins three other OOCL trans-Pacific services that connect Mexico, along with the West Coast of South America, to Asia. OOCL added its last Asia-Mexico-South America service, TLP5, back in May 2024. Last year also saw <a href="https://www.joc.com/article/msc-adds-to-growing-asia-mexico-service-launches-5192264">Mediterranean Shipping Co. and CMA CGM add new trans-Pacific services between Asia, Mexico and South America</a>. Mexico saw a surge of foreign direct investment last year from China, reaching $710 million, according to Mexico’s economic secretary. Mexico imported $129 billion worth of goods from China in 2024, according to data from the country’s economy secretary, the highest in two decades. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Orient Overseas Container Line (OOCL) later this month will begin offering a trans-Pacific express service to Mexico’s West Coast, adding to the list of new ocean services that have sprung up as China reorients its trade networks. OOCL said Monday that its Trans-Pacific Latin Pacific 8 (TLP8) service will start with an Aug. 20 departure from Shanghai. The TLP8’s Asia rotation covers Shanghai and Qingdao, and the eastbound voyage includes Mexico’s Ensenada and Manzanillo, along with a westbound call at Yokohama. The TLP8 is offering 17-day transit between Qingdao and Ensenada. The Port of Ensenada has one berth capable of handling post-Panamax ships up to 6,000 TEUs in capacity. The TLP8 joins three other OOCL trans-Pacific services that connect Mexico, along with the West Coast of South America, to Asia. OOCL added its last Asia-Mexico-South America service, TLP5, back in May 2024. Last year also saw Mediterranean Shipping Co. and CMA CGM add new trans-Pacific services between Asia, Mexico and South America . Mexico saw a surge of foreign direct investment last year from China, reaching $710 million, according to Mexico’s economic secretary. Mexico imported $129 billion worth of goods from China in 2024, according to data from the country’s economy secretary, the highest in two decades. Contact Michael Angell at michael.angell@spglobal.com .

Trans-Pacific

OOCL adds service to tap China-to-Mexico trade boom

<div class="phx-topic abstract-wrapper">The latest data from the Intermodal Association of North America shows how railroads have lost US business to over-the-road trucking, writes analyst Larry Gross. </div>

The latest data from the Intermodal Association of North America shows how railroads have lost US business to over-the-road trucking, writes analyst Larry Gross.

<div class="phx-topic">With the Intermodal Association of North America intermodal numbers for June and Transport Futures’ preliminary second-quarter 2025 truck numbers in our mailbox, we have been able to calculate intermodal market share for the second quarter. It doesn’t look pretty. The market share numbers from IANA are for the US only. We simply have not been able to find a timely source of truckload numbers for Canada or Mexico. We track intermodal loads both originating and terminating within the US and compare these figures to Transport Futures’ estimates for US dry van and reefer truckloads moving 500 miles or further. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6061248_0.1.jpg"></img></div>While we typically concentrate on year-over-year changes in activity, when it comes to calculating market share, we focus on the quarter-over-quarter changes in the seasonally adjusted numbers. We use seasonally adjusted numbers because the truckload and intermodal markets have different seasonal patterns. If we used the raw, unadjusted figures, market share would fluctuate every quarter just due to normal seasonality. Our goal is to wash those seasonal fluctuations out of the equation so as to see the true underlying trend. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="eb51908a-13f3-4845-96d9-06d50831c4d2"></dynamic-object></div>The seasonally adjusted trucking numbers have been relatively flat, gaining just 0.3% from the fourth quarter of 2024 to the first quarter of 2025 and then easing back 0.4% in the second quarter. Looking at the intermodal numbers, intra-US intermodal activity dropped an unadjusted 4.6% from the third quarter to the fourth quarter. This doesn’t sound good, but the decline was less than the normal seasonal drop. Once seasonal adjustments were applied, seasonally adjusted intermodal activity rose 1.2% from the fourth quarter of 2024 to the first quarter of 2025. The story was different in the second quarter. Unadjusted intermodal volume dropped 2.1%. But, in a normal year, the second quarter is always stronger than the first quarter. Therefore, seasonal adjustments magnified the drop, increasing the decline in total US intermodal activity to a seasonally adjusted 7.3%. The resulting market share calculations show a large 0.7% drop in overall intermodal share from the first quarter to the second quarter, the biggest single-quarter decline since the post-pandemic congestion crisis. A big chunk of this decline was due to the large drop in international intermodal activity, surely reflecting the push-pull effects of the tariff mayhem. Intermodal is far more sensitive to changes in international trade flows than trucking is, as trucking is dominated by the domestic US economy. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="b44a76a7-5f15-47ca-9bec-f98bcde0376e"></dynamic-object></div>But the intermodal share for the domestic sector (domestic containers and trailers on freight car) also declined in the second quarter, for the second straight quarter. Two consecutive quarters of improvement in the second half of last year had raised hopes that a recovery was underway, but it was not to be. Domestic share dropped to 5.9%, the lowest level since 2011. No doubt the continued soft trucking conditions bear some of the blame. But North American domestic intermodal activity was only 4.2% higher in 2024 than it was in 2015, nine years prior. During this same time frame, US GDP grew 24% and US long-haul trucking increased 19%. In other words, this is a longer-term problem that won’t be solved simply by waiting for the “goldilocks” moment of optimal market conditions. In truth, intermodal market share is probably a bit lower than these figures show. A significant amount of crosstown activity occurs in interchange locations such as Chicago. This has the effect of turning what is in truth a single, long-haul move into two, separately reported, shorter, single railroad moves. We estimate that such double-counting of moves involving rubber-tire crosstown moves has inflated the total North American intermodal load count by at least five percent. All is not lost, however. New services and terminals have been recently announced. These are key to rekindling intermodal growth because the biggest determinant of intermodal competitiveness is the proximity of the intermodal terminal to where the freight originates and terminates. Additionally, there has been strong domestic intermodal growth in non-US markets, including the intra-Mexico and Mexico-US cross-border markets. But the intra-US market accounts for 86% of all North American intermodal activity moving in domestic containers and trailers. As goes the US, so goes North American intermodal. Contact Larry Gross at <a href="mailto:lgross@intermodalindepth.com">lgross@intermodalindepth.com</a>. </div>

With the Intermodal Association of North America intermodal numbers for June and Transport Futures’ preliminary second-quarter 2025 truck numbers in our mailbox, we have been able to calculate intermodal market share for the second quarter. It doesn’t look pretty. The market share numbers from IANA are for the US only. We simply have not been able to find a timely source of truckload numbers for Canada or Mexico. We track intermodal loads both originating and terminating within the US and compare these figures to Transport Futures’ estimates for US dry van and reefer truckloads moving 500 miles or further. While we typically concentrate on year-over-year changes in activity, when it comes to calculating market share, we focus on the quarter-over-quarter changes in the seasonally adjusted numbers. We use seasonally adjusted numbers because the truckload and intermodal markets have different seasonal patterns. If we used the raw, unadjusted figures, market share would fluctuate every quarter just due to normal seasonality. Our goal is to wash those seasonal fluctuations out of the equation so as to see the true underlying trend. The seasonally adjusted trucking numbers have been relatively flat, gaining just 0.3% from the fourth quarter of 2024 to the first quarter of 2025 and then easing back 0.4% in the second quarter. Looking at the intermodal numbers, intra-US intermodal activity dropped an unadjusted 4.6% from the third quarter to the fourth quarter. This doesn’t sound good, but the decline was less than the normal seasonal drop. Once seasonal adjustments were applied, seasonally adjusted intermodal activity rose 1.2% from the fourth quarter of 2024 to the first quarter of 2025. The story was different in the second quarter. Unadjusted intermodal volume dropped 2.1%. But, in a normal year, the second quarter is always stronger than the first quarter. Therefore, seasonal adjustments magnified the drop, increasing the decline in total US intermodal activity to a seasonally adjusted 7.3%. The resulting market share calculations show a large 0.7% drop in overall intermodal share from the first quarter to the second quarter, the biggest single-quarter decline since the post-pandemic congestion crisis. A big chunk of this decline was due to the large drop in international intermodal activity, surely reflecting the push-pull effects of the tariff mayhem. Intermodal is far more sensitive to changes in international trade flows than trucking is, as trucking is dominated by the domestic US economy. But the intermodal share for the domestic sector (domestic containers and trailers on freight car) also declined in the second quarter, for the second straight quarter. Two consecutive quarters of improvement in the second half of last year had raised hopes that a recovery was underway, but it was not to be. Domestic share dropped to 5.9%, the lowest level since 2011. No doubt the continued soft trucking conditions bear some of the blame. But North American domestic intermodal activity was only 4.2% higher in 2024 than it was in 2015, nine years prior. During this same time frame, US GDP grew 24% and US long-haul trucking increased 19%. In other words, this is a longer-term problem that won’t be solved simply by waiting for the “goldilocks” moment of optimal market conditions. In truth, intermodal market share is probably a bit lower than these figures show. A significant amount of crosstown activity occurs in interchange locations such as Chicago. This has the effect of turning what is in truth a single, long-haul move into two, separately reported, shorter, single railroad moves. We estimate that such double-counting of moves involving rubber-tire crosstown moves has inflated the total North American intermodal load count by at least five percent. All is not lost, however. New services and terminals have been recently announced. These are key to rekindling intermodal growth because the biggest determinant of intermodal competitiveness is the proximity of the intermodal terminal to where the freight originates and terminates. Additionally, there has been strong domestic intermodal growth in non-US markets, including the intra-Mexico and Mexico-US cross-border markets. But the intra-US market accounts for 86% of all North American intermodal activity moving in domestic containers and trailers. As goes the US, so goes North American intermodal. Contact Larry Gross at lgross@intermodalindepth.com .

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