<div class="phx-topic abstract-wrapper"><p>The opening of an airline terminal hardly qualifies as news to business travelers, except perhaps wh</p></div>

The opening of an airline terminal hardly qualifies as news to business travelers, except perhaps wh

<div><p>The opening of an airline terminal hardly qualifies as news to business travelers, except perhaps when the tenant is a super-giant like United Airlines and the terminal is the world's most modern, and largest, single- tenant facility, located at Chicago's O'Hare International Airport.</p><p></p><p></p><p>When Chicago's Mayor Harold Washington threw the switch activating kinetic light sculptures in the 815-foot walkway between the terminal's two concourses, symbolically opening the new United terminal this past Monday morning, a long overdue step in the history of modern aviation was taken.At long last, significant efforts are seriously under way to build bigger and better terminals rather...

The opening of an airline terminal hardly qualifies as news to business travelers, except perhaps when the tenant is a super-giant like United Airlines and the terminal is the world's most modern, and largest, single- tenant facility, located at Chicago's O'Hare International Airport. When Chicago's Mayor Harold Washington threw the switch activating kinetic light sculptures in the 815-foot walkway between the terminal's two concourses, symbolically opening the new United terminal this past Monday morning, a long overdue step in the history of modern aviation was taken.At long last, significant efforts are seriously under way to build bigger and better terminals rather than just bigger and better airplanes. This first addition to the $1.4 billion renovation of O'Hare opened its doors to the public on Aug. 4 and will be completed by the end of next year at the cost of more than $500 million. The "Terminal for Tomorrow," as United Airlines describes it, is specifically designed with the realities of modern travel in mind. If it all functions as well as United predicts, this striking new facility will be a particular blessing for business travelers. As the United States' busiest airport and major hub, O'Hare is an important intersection for commercial travelers. Congestion in the air, on the highways to and from the airport and in the terminals has made life miserable for vacationers and executives alike. Originally built in the early '60s to accommodate 20 million to 25 million passengers annually, O'Hare now serves twice that number. The new United facility is projected to handle 75 million to 80 million passengers by 1995. The sleek and modern new terminal, with its light and airy open main halls and vaulted barrel glass ceilings, "suggests the turn of the century feeling of peace and calm in travel," in the words of architect Helmut Jahn. In style there was a deliberate attempt to represent the historic past of a simpler and more elegant - and less frantic - era of travel, inspired by, but without imitating, such buildings as the Galleria of Milan, the Crystal Palace in Paris, the grand railroad stations of the 19th century. Yet behind all that design symbolism beats an awesome computer-controlled, robotic heart, the likes of which has never been assembled in a major airport terminal before. United is Chicago's "home town airline," as it likes to call itself. Fittingly, the comparisons were created to appeal to Chicago community pride: The two main concourses are each longer than the Sears Tower lying on its side; 1,600 feet (but with moving sidewalks, the only ones in the airport). Fifteen acres of glass were used in the exterior walls - using natural lighting in what must be the world's largest greenhouse - enough glass to put a dome over Wrigley Field and Comisky Park. The 85 acres of the terminal and aprons is half the size of the Chicago Loop. Enough concrete was used in aircraft parking aprons to build a four-foot wide sidewalk from Chicago to New York. The use of natural lighting, in fact, makes the terminal look even larger and more spacious than it is, distracting from crowds that will soon fill its main halls. But the new terminal's futuristic design takes second place to function. For all its size, many aspects of O'Hare's original terminals proved unworkable from the beginning. United has concentrated hard on making the new terminal not just big but first and foremost engineered to efficiently handle whatever future growth commercial aviation throws its way. "Flow is the one word I would use to describe this new terminal," said Rod Strickland, director of customer services planning for United. "Flow of people and baggage." It all starts at curb-side with six baggage check-in stations instead of the one provided before, and an increase of passenger drop-off curb length from 300 feet to 750 feet. Roadways have been expanded. The upper level roadway was increased from four to seven lanes and the lower roadway from seven to eight lanes. Once into the terminal, passenger flow is maintained by use of 56 flow- through one-way stations, similar to supermarket check-out counters, keeping the foot traffic going in one direction. This is the first new terminal built after security screening stations became a regular and permanent part of airports. Rather than being add-ons in areas never intended for their use, 10 security gate positions were designed into the plan from the beginning to get passengers through as quickly as possible immediately after check-in. From the time you check your luggage at curb-side, or inside the terminal, until it is automatically loaded on a cart at plane-side, it is never touched by human hands. Laser scanners read bar codes on the baggage tags. A maze of computer-controlled conveyors in the basement level move the luggage along at the rate of 150 feet a minute to the exact gate indicated on the bar code. Of the 42 gate positions, 14 are within 200 feet of the curb. According to Tony Chaitin, senior vice president corporate services, flights most often used by frequent flying business travelers will most times be assigned these close-in gates, further speeding the process forthe fast moving executive; a definite improvement over cross-country hikes required to get to your plane in O'Hare's older terminals. A new integrated computer system will be used that ties in the Apollo reservation system to airport computer systems and even to on-board flight computers. When a departure or arrival time is changed in any of these computer systems it will automatically be changed on every computerized gate display or screen so everyone from pilot to passenger has the same information at the same time. Special tickets with magnetic stripes that can be scanned by computers at the gate will permit passengers to use the ticket as an electronically read boarding pass. The baggage claim area is expanded to three times present size or 80,000 square feet. Backstage, a new automated service center inventories thousands of parts that can be retrieved in seconds by a robotic system, enabling mechanics to get needed replacement parts quickly and speed maintenance and eliminate flight delays. Business travelers are a jaded lot when it comes to believing the worldwide airport congestion problem will ever be solved. But if an answer is ever to be found it most likely will be in the construction of new high-tech facilities like United's Terminal for Tomorrow.

Air Cargo

AT LAST, A BIGGER AND BETTER AIRLINE TERMINAL

<div class="phx-topic abstract-wrapper"><p>Broad use of Section 301 tariffs, with 60 US trading partners now being scrutinized, provide a window into the administration’s next phase of tariff applications as it seeks to redefine US trade. </p></div>

Broad use of Section 301 tariffs, with 60 US trading partners now being scrutinized, provide a window into the administration’s next phase of tariff applications as it seeks to redefine US trade.

Feature image

<div class="phx-topic"><p>Importers buoyed by a February US Supreme Court decision that overturned billions of dollars of tariffs they paid are now coming to grips with a new wave of tariffs that are likely to burden their inventory replenishment and holiday shipping plans. </p><p>The US Trade Representative (USTR) last week launched two separate Section 301 investigations covering a total of 60 countries: one related to “structural excess capacity and production in manufacturing sectors” and a second aimed at forced labor. Should the investigations result in additional tariffs — widely expected to be the outcome — those duties will heap more cost pressure and customs administrative work on US importers, as well as reduce the appeal of sourcing from countries seen as lower-tariff alternatives to China. </p><div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6187602_0.1.jpg"></img></div><p>More immediately, the tariffs could land just as US retailers typically begin peak season ordering ahead of the winter holidays. </p><p>That will have an impact on containerized US import market share. Vietnam, for example, saw its share of inbound US volumes rise to 12% in 2025 from 9.9% in 2024, mostly at the expense of mainland China, whose share fell to 36% from 40.4% in 2024, according to PIERS, a sister product of the <i>Journal of Commerce</i> within S&amp;P Global. </p><h3>Expected pivot </h3><p>The two sets of investigations can be viewed as the Trump administration clearly pivoting from tariffs assessed through executive order, by way of the International Emergency Economic Powers Act (IEEPA), to ones with a more straightforward track record of surviving legal challenges. </p><p>The Supreme Court on Feb. 20 <a href="https://www.joc.com/article/us-supreme-court-rules-against-trump-in-critical-ieepa-tariff-case-6173568">ruled that the IEEPA tariffs had been levied illegally</a>, and the US Court of International Trade has ordered US Customs and Border Protection to <a href="https://www.joc.com/article/cbp-lays-out-initial-tariff-refund-plan-that-requires-minimal-work-from-importers-6183418">create a process to refund importers more than $160 billion in tariffs</a> they paid, plus interest. </p><p>Trade experts said they expected the administration to quickly use other tools to progress with its tariff-focused foreign trade policy in the event the IEEPA tariffs were struck down. </p><p>The structural capacity investigation will look into whether 16 different countries or trading blocs, including China, India, Vietnam, Indonesia and the EU, are imposing policies or practices that “burden or restrict US commerce.” </p><p>The broader investigation into forced labor covers virtually every major US trading partner and can be seen as the USTR trying to replicate the scale of President Trump’s so-called Liberation Day tariffs that were eventually struck down. In the interim, Trump has used Section 122 of the Trade Act to temporarily assess 10% tariffs on all US imports, outside of goods exempted through existing trade agreements. </p><p>The pace of the investigations also hints at the administration’s desire for the new tariffs, or at least the threat thereof, to be in place by the time the Section 122 duties expire on July 27. Comments on both investigations are due April 15, with hearings for the forced labor and structural capacity inquiries scheduled for April 28 and May 5, respectively. </p><p>In announcing the probes, USTR said it has requested consultations with all governments named in the investigations. All the economies named in the structural capacity inquiry are also involved in the forced labor investigations, which means the trade representative will be looking to have conversations with 60 different entities in the coming months, presumably to use the threat of tariffs as leverage. </p><p>Deborah Elms, head of trade policy at Singapore-based Hinrich Foundation, said the USTR’s use of Section 301 in this context, while likely to be effective in that it will allow the administration to impose new tariffs, runs counter to the initial intent of the statute. </p><p>During President Trump’s first term, the USTR was able to assess 25% Section 301 tariffs on Chinese goods that have remained despite two changes of power in the executive branch. The scope of the new Section 301 tariffs the USTR is seeking would dwarf those previously implemented, though there has yet to be any formal discussion about the level of tariffs that might result from these investigations </p><p>“Section 301 was originally intended as a tool to get countries to negotiate and remove barriers to US exports,” she wrote in a March 12 blog. “This administration appears keen to retaliate first and discuss mostly later.” </p><p>For importers, the intent of Section 301 tariffs matter because they are likely to be more durable and legally defensible than either the IEEPA or Section 122 tariffs. Additionally, unless countries are able to negotiate their way out of prospective Section 301 tariffs by providing market access to US exporters or curtailing domestic production subsidies, importers will find there are fewer avenues to escape an added cost on international trade. </p><p>Elms described Section 301 as “one of the most powerful weapons in the trade policy arsenal for any US executive branch pursuing aggressive unilateralism,” adding that it provides a range of options under the broad category of “relief from unfair trade practices.” </p><p>Elms noted the 16 industries under investigation in the “structural capacity” probe range from steel production in China to chemical manufacturing in Germany and currency manipulation in Switzerland. </p><p>The two investigations are also unlikely to be the last. USTR Jamieson Greer has previously hinted at the potential for cases focused on digital trade and digital services taxes. </p><p><i>Contact Eric Johnson at </i><a href="mailto:eric.johnson@spglobal.com"><i>eric.johnson@spglobal.com</i></a><i>.</i>  </p></div>

Importers buoyed by a February US Supreme Court decision that overturned billions of dollars of tariffs they paid are now coming to grips with a new wave of tariffs that are likely to burden their inventory replenishment and holiday shipping plans. The US Trade Representative (USTR) last week launched two separate Section 301 investigations covering a total of 60 countries: one related to “structural excess capacity and production in manufacturing sectors” and a second aimed at forced labor. Should the investigations result in additional tariffs — widely expected to be the outcome — those duties will heap more cost pressure and customs administrative work on US importers, as well as reduce the appeal of sourcing from countries seen as lower-tariff alternatives to China. More immediately, the tariffs could land just as US retailers typically begin peak season ordering ahead of the winter holidays. That will have an impact on containerized US import market share. Vietnam, for example, saw its share of inbound US volumes rise to 12% in 2025 from 9.9% in 2024, mostly at the expense of mainland China, whose share fell to 36% from 40.4% in 2024, according to PIERS, a sister product of the Journal of Commerce within S&P Global. Expected pivot The two sets of investigations can be viewed as the Trump administration clearly pivoting from tariffs assessed through executive order, by way of the International Emergency Economic Powers Act (IEEPA), to ones with a more straightforward track record of surviving legal challenges. The Supreme Court on Feb. 20 ruled that the IEEPA tariffs had been levied illegally , and the US Court of International Trade has ordered US Customs and Border Protection to create a process to refund importers more than $160 billion in tariffs they paid, plus interest. Trade experts said they expected the administration to quickly use other tools to progress with its tariff-focused foreign trade policy in the event the IEEPA tariffs were struck down. The structural capacity investigation will look into whether 16 different countries or trading blocs, including China, India, Vietnam, Indonesia and the EU, are imposing policies or practices that “burden or restrict US commerce.” The broader investigation into forced labor covers virtually every major US trading partner and can be seen as the USTR trying to replicate the scale of President Trump’s so-called Liberation Day tariffs that were eventually struck down. In the interim, Trump has used Section 122 of the Trade Act to temporarily assess 10% tariffs on all US imports, outside of goods exempted through existing trade agreements. The pace of the investigations also hints at the administration’s desire for the new tariffs, or at least the threat thereof, to be in place by the time the Section 122 duties expire on July 27. Comments on both investigations are due April 15, with hearings for the forced labor and structural capacity inquiries scheduled for April 28 and May 5, respectively. In announcing the probes, USTR said it has requested consultations with all governments named in the investigations. All the economies named in the structural capacity inquiry are also involved in the forced labor investigations, which means the trade representative will be looking to have conversations with 60 different entities in the coming months, presumably to use the threat of tariffs as leverage. Deborah Elms, head of trade policy at Singapore-based Hinrich Foundation, said the USTR’s use of Section 301 in this context, while likely to be effective in that it will allow the administration to impose new tariffs, runs counter to the initial intent of the statute. During President Trump’s first term, the USTR was able to assess 25% Section 301 tariffs on Chinese goods that have remained despite two changes of power in the executive branch. The scope of the new Section 301 tariffs the USTR is seeking would dwarf those previously implemented, though there has yet to be any formal discussion about the level of tariffs that might result from these investigations “Section 301 was originally intended as a tool to get countries to negotiate and remove barriers to US exports,” she wrote in a March 12 blog. “This administration appears keen to retaliate first and discuss mostly later.” For importers, the intent of Section 301 tariffs matter because they are likely to be more durable and legally defensible than either the IEEPA or Section 122 tariffs. Additionally, unless countries are able to negotiate their way out of prospective Section 301 tariffs by providing market access to US exporters or curtailing domestic production subsidies, importers will find there are fewer avenues to escape an added cost on international trade. Elms described Section 301 as “one of the most powerful weapons in the trade policy arsenal for any US executive branch pursuing aggressive unilateralism,” adding that it provides a range of options under the broad category of “relief from unfair trade practices.” Elms noted the 16 industries under investigation in the “structural capacity” probe range from steel production in China to chemical manufacturing in Germany and currency manipulation in Switzerland. The two investigations are also unlikely to be the last. USTR Jamieson Greer has previously hinted at the potential for cases focused on digital trade and digital services taxes. Contact Eric Johnson at eric.johnson@spglobal.com .

Transport, Trade and Regulation News

Supply chain

Potential new US tariffs cloud sourcing strategies, peak season demand

<div class="phx-topic abstract-wrapper"><p>The recent increase in intermodal share in the face of declining West Coast share is intriguing, and it might be signaling a more significant change in the situation, writes Larry Gross. </p></div>

The recent increase in intermodal share in the face of declining West Coast share is intriguing, and it might be signaling a more significant change in the situation, writes Larry Gross.

<div class="phx-topic"><p>The share of imports arriving in the US and Western Canada that travel inland via rail has been in a long-term decline. Changes in shipping patterns are a big reason why, with major implications as to where things are heading and the railroads’ ability to affect the result. </p><div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6187602_0.1.jpg"></img></div><p>The chart below tracks two measures over the past 16 years. The first is the share of US plus Western Canadian import TEUs arriving on the West Coast. As has been well documented, this share has been in a long-term decline as importers have moved away from West Coast-centric strategies towards four- and five-corner strategies that provide greater diversification and lower costs. Twelve-month moving average West Coast share declined by over 10 points from 59% in 2010 to under 49% in 2025. </p><div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="651db556-cc65-494c-abea-84774e97a373"></dynamic-object></div><p>The second statistic is the percentage of import TEUs arriving that travel inland from the coast via intermodal. This includes both inland point intermodal (IPI) loads and South California transloads. Intermodal share has also seen a long-term decline similar to that of West Coast share. The linear trends over this period for both statistics are almost parallel. The correlation was very strong between 2014 through mid-2022. </p><p>We know that intermodal share is higher off the West Coast than elsewhere, due primarily to length-of-haul effects. The longer runs from the West Coast to the consumption centers inland are much more intermodal-friendly than the short, dispersed hauls out of other port regions. </p><p>It is interesting, however, to note that since mid-2022, this tight correlation has loosened significantly. Viewed on a 12-month moving average basis, intermodal share began to recover at that point from the post-pandemic surge congestion, a full year before West Coast share turned upward. In 2023, intermodal share resumed declining, while West Coast share continued to rise. Then, in 2025, West Coast share began to decline once again, but intermodal share began to move up.  </p><h3>Inversely correlated? </h3><p>Does this de-coupling indicate that the basic bond has been broken between these two measures? I don’t think so. But it does indicate that other factors (congestion, surges, and so forth) have taken control for the time being. It may also say that these inter-dependent but separate systems have reacted to the recent volatility differently and each with their own timing. </p><p>On the other hand, the recent increase in intermodal share in the face of declining West Coast share is intriguing. It might be signaling a more significant change in the situation and certainly bears watching. </p><p>If the inter-dependence remains intact, what does that indicate for the future? At the start of the year, West Coast share could have reasonably been expected to continue the decline that resumed in 2025. The Gaza situation had stabilized, and the Red Sea/Suez routing was slowly opening back up. The East Coast option was looking better all the time. But of course, the Iran hostilities have now thrown that all out the window. The trans-Pacific trade is, at least for the moment, more isolated from the disruption. West Coast share can be expected to stabilize or even improve. This will be an intermodal tailwind for the time being. </p><p>This analysis also tells us that most of what happens here is completely out of the railroads’ control. They will continue to be subject to the routing decisions of the ocean carriers and the importers. It is on the domestic side of the intermodal house where the railroads have more ability to control their destiny and their share.  </p><p><i>Larry Gross is president and founder of Gross Transportation Consulting. Contact him at </i><a href="mailto:lawrencejgross@gmail.com"><i>lawrencejgross@gmail.com</i></a><i>.</i>  </p></div>

The share of imports arriving in the US and Western Canada that travel inland via rail has been in a long-term decline. Changes in shipping patterns are a big reason why, with major implications as to where things are heading and the railroads’ ability to affect the result. The chart below tracks two measures over the past 16 years. The first is the share of US plus Western Canadian import TEUs arriving on the West Coast. As has been well documented, this share has been in a long-term decline as importers have moved away from West Coast-centric strategies towards four- and five-corner strategies that provide greater diversification and lower costs. Twelve-month moving average West Coast share declined by over 10 points from 59% in 2010 to under 49% in 2025. The second statistic is the percentage of import TEUs arriving that travel inland from the coast via intermodal. This includes both inland point intermodal (IPI) loads and South California transloads. Intermodal share has also seen a long-term decline similar to that of West Coast share. The linear trends over this period for both statistics are almost parallel. The correlation was very strong between 2014 through mid-2022. We know that intermodal share is higher off the West Coast than elsewhere, due primarily to length-of-haul effects. The longer runs from the West Coast to the consumption centers inland are much more intermodal-friendly than the short, dispersed hauls out of other port regions. It is interesting, however, to note that since mid-2022, this tight correlation has loosened significantly. Viewed on a 12-month moving average basis, intermodal share began to recover at that point from the post-pandemic surge congestion, a full year before West Coast share turned upward. In 2023, intermodal share resumed declining, while West Coast share continued to rise. Then, in 2025, West Coast share began to decline once again, but intermodal share began to move up. Inversely correlated? Does this de-coupling indicate that the basic bond has been broken between these two measures? I don’t think so. But it does indicate that other factors (congestion, surges, and so forth) have taken control for the time being. It may also say that these inter-dependent but separate systems have reacted to the recent volatility differently and each with their own timing. On the other hand, the recent increase in intermodal share in the face of declining West Coast share is intriguing. It might be signaling a more significant change in the situation and certainly bears watching. If the inter-dependence remains intact, what does that indicate for the future? At the start of the year, West Coast share could have reasonably been expected to continue the decline that resumed in 2025. The Gaza situation had stabilized, and the Red Sea/Suez routing was slowly opening back up. The East Coast option was looking better all the time. But of course, the Iran hostilities have now thrown that all out the window. The trans-Pacific trade is, at least for the moment, more isolated from the disruption. West Coast share can be expected to stabilize or even improve. This will be an intermodal tailwind for the time being. This analysis also tells us that most of what happens here is completely out of the railroads’ control. They will continue to be subject to the routing decisions of the ocean carriers and the importers. It is on the domestic side of the intermodal house where the railroads have more ability to control their destiny and their share. Larry Gross is president and founder of Gross Transportation Consulting. Contact him at lawrencejgross@gmail.com .

Surface

Trans-Pacific

North American ports

North-American rail

Intermodal providers

Maritime

Ocean shipping patterns erode intermodal share from West Coast: analyst

<div class="phx-topic abstract-wrapper"><p>After a pause in trans-Pacific service contract negotiations caused by the war in the Middle East, talks are expected to move forward now that the largest US retailer has concluded some of its agreements.</p></div>

After a pause in trans-Pacific service contract negotiations caused by the war in the Middle East, talks are expected to move forward now that the largest US retailer has concluded some of its agreements.

<div class="phx-topic"><p>Container lines that paused trans-Pacific service contract talks to assess the impact of the war in the Middle East are back at the table, and expectations are that major retailers will sign in the coming week now that Walmart has finalized its 2026–27 contracts with a half-dozen carriers. </p><p>Walmart’s move opens the door for other major retailers and, in turn, smaller importers and then non-vessel operating common carriers to ink their own service contracts, which typically go into effect May 1. </p><p>Despite the <a href="https://www.joc.com/article/china-india-warn-carriers-on-higher-pricing-tied-to-middle-east-conflict-6183986">unknowns in terms of length and scope of the now two-week-long Middle East war</a>, carriers say big-box retailers want to lock in vessel capacity.  </p><p>Walmart, <a href="">the largest US importer</a>, has wrapped up its contract discussions with its core carriers, two sources familiar with the matter told the Journal of Commerce.  </p><p>Carriers, and some forwarders, are urging customers to move expeditiously in their contract negotiations, rather than allowing uncertainties in global trade to deter them. </p><p>“We now have seen an unpredictable shock to the global ocean market in like four of the last six years,” a carrier executive who asked not to be named told the <i>Journal of Commerce</i>. “Some BCOs [beneficial cargo owners] recognized that and wanted to take risk off the table; they signed early and at higher rates than many were predicting.” </p><p>The executive added that analyst forecasts of supply and demand have rarely matched reality in recent years due to that outsized volatility. Geopolitical events including diversions away from the Red Sea, unpredictable US tariff policy and even more weather events, impacting ocean reliability, have begun to shift some shippers’ thinking, he said.  </p><p>“Some shippers have come to realize that pushing carriers well below breakeven to save a few cents on their cost of goods is not worth the risk of a major unpredictable event happening,” the executive said.  </p><h3>Recouping higher fuel costs </h3><p>While securing space remains paramount for cargo owners, rising bunker fuel prices, driven by the closure of the Strait of Hormuz, <a href="https://www.joc.com/article/fmc-says-closely-monitoring-carrier-rate-moves-tied-to-middle-east-war-6184781">is also driving contract discussions regarding bunker fuel adjustment factors</a>. Shippers are reluctant to compensate carriers for the rising operating costs tied to the Middle East on a trade lane that is not directly impacted.  </p><p>“The uncertainty and waiting around for clarity or resolution is not helpful to anyone,” said Kevin Parkerson, a consultant and former logistics manager at retailers. “Yes, it may impact overall capacity. Yes, it may impact fuel prices. But at this point, that shouldn’t delay the process of contracting. Everybody seems to be proceeding cautiously.” </p><p>At the moment, securing capacity in the Asia-US West Coast trade is not a significant issue that would slow negotiations. </p><p>“Asia to the West Coast will be fine,” a second carrier executive told the <i>Journal of Commerce</i>, noting that if the war in the Middle East drags on for some weeks, East Coast routings from the Indian sub-continent could be impacted by the <a href="https://www.joc.com/article/waves-of-diverted-containers-swamping-middle-east-ports-6183989">congestion that is already building at some ports in the region</a>. </p><p>In the interim, most importers would be wise to secure the minimum quantity commitments in their contracts as soon as they have a handle on what their space requirements will be, a third carrier executive said. </p><p>“Those BCOs who are slow-walking their negotiations to wait for better prices — it may backfire,” the executive said.  </p><p><i>Contact Bill Mongelluzzo at </i><a href="mailto:bill.mongelluzzo@spglobal.com"><i>bill.mongelluzzo@spglobal.com</i></a><i>.</i></p></div>

Container lines that paused trans-Pacific service contract talks to assess the impact of the war in the Middle East are back at the table, and expectations are that major retailers will sign in the coming week now that Walmart has finalized its 2026–27 contracts with a half-dozen carriers. Walmart’s move opens the door for other major retailers and, in turn, smaller importers and then non-vessel operating common carriers to ink their own service contracts, which typically go into effect May 1. Despite the unknowns in terms of length and scope of the now two-week-long Middle East war , carriers say big-box retailers want to lock in vessel capacity. Walmart,  the largest US importer , has wrapped up its contract discussions with its core carriers, two sources familiar with the matter told the Journal of Commerce.   Carriers, and some forwarders, are urging customers to move expeditiously in their contract negotiations, rather than allowing uncertainties in global trade to deter them. “We now have seen an unpredictable shock to the global ocean market in like four of the last six years,” a carrier executive who asked not to be named told the Journal of Commerce. “Some BCOs [beneficial cargo owners] recognized that and wanted to take risk off the table; they signed early and at higher rates than many were predicting.” The executive added that analyst forecasts of supply and demand have rarely matched reality in recent years due to that outsized volatility. Geopolitical events including diversions away from the Red Sea, unpredictable US tariff policy and even more weather events, impacting ocean reliability, have begun to shift some shippers’ thinking, he said. “Some shippers have come to realize that pushing carriers well below breakeven to save a few cents on their cost of goods is not worth the risk of a major unpredictable event happening,” the executive said. Recouping higher fuel costs While securing space remains paramount for cargo owners, rising bunker fuel prices, driven by the closure of the Strait of Hormuz, is also driving contract discussions regarding bunker fuel adjustment factors . Shippers are reluctant to compensate carriers for the rising operating costs tied to the Middle East on a trade lane that is not directly impacted. “The uncertainty and waiting around for clarity or resolution is not helpful to anyone,” said Kevin Parkerson, a consultant and former logistics manager at retailers. “Yes, it may impact overall capacity. Yes, it may impact fuel prices. But at this point, that shouldn’t delay the process of contracting. Everybody seems to be proceeding cautiously.”  At the moment, securing capacity in the Asia-US West Coast trade is not a significant issue that would slow negotiations. “Asia to the West Coast will be fine,” a second carrier executive told the Journal of Commerce, noting that if the war in the Middle East drags on for some weeks, East Coast routings from the Indian sub-continent could be impacted by the congestion that is already building at some ports in the region . In the interim, most importers would be wise to secure the minimum quantity commitments in their contracts as soon as they have a handle on what their space requirements will be, a third carrier executive said. “Those BCOs who are slow-walking their negotiations to wait for better prices — it may backfire,” the executive said. Contact Bill Mongelluzzo at  bill.mongelluzzo@spglobal.com .

Container Shipping News

Trans-Pacific contract talks accelerating after Walmart signs

<div class="phx-topic abstract-wrapper"><p>The Meridian Speedway dispute is important because it’s one of the primary routes where a combined Union Pacific-Norfolk Southern railroad would look to take market share from truckload. </p></div>

The Meridian Speedway dispute is important because it’s one of the primary routes where a combined Union Pacific-Norfolk Southern railroad would look to take market share from truckload.

<div class="phx-topic"><p>The US Surface Transportation Board (STB) will not intervene in a dispute over the Meridian Speedway, a critical intermodal route connecting the West Coast to the US Southeast where three railroads must team up to execute service. </p><p>The unanimous ruling, issued Friday, culminates more than six months of arguing between Union Pacific Railroad, Norfolk Southern Railway, and Canadian Pacific Kansas City.  </p><p>CPKC applauded the decision that "exemplifies behavior typical of Union Pacific attempting to bully its way," in a statement. UP, expressing disappointment in the system, told the <i>Journal of Commerce</i> that Canadian Pacific changed operations and service on the line when it acquired Kanas City Southern, but UP also said it was moving on post-decision.</p><p>The dispute boiled over last summer when FedEx and UPS trucked cargo around the stretch of track to bypass the disruptions. The two parcel giants lean on the railroads to move parcels across the US and impose stringent requirements for on-time performance in their service agreements. </p><p>The Meridian Speedway, a nearly 300-mile stretch between Louisiana and Mississippi, is a joint venture in which CPKC controls 70% and Norfolk Southern controls the remaining 30%. CPKC oversees dispatching and operations. The Meridian Speedway slashes more than three days between Los Angeles and Atlanta compared with going through Memphis. </p><p>The dispute centers around CPKC’s decision to restrict train lengths to 8,500 feet, while UP and NS prefer trains that are 11,000 feet long. UP argues the restriction forces them to break up the containers into two different blocks, and CPKC provides substandard service on the second train. </p><p>CPKC counters that most of the sidings — akin to the shoulder of a highway — are not long enough to handle an 11,000-foot train. When there is a conflict between two trains, the CPKC train is often the one stopped for hours at a time to let the 11,000-foot UP train pass. </p><p>In an unanimous decision, though, the STB decided not to intervene. </p><p>“As CPKC notes, the increased dwell of UP’s ‘second train’ could also be attributable to an agreement between CPKC and [Norfolk Southern] that the second train would be scheduled to depart four hours and forty minutes after the first,” STB wrote in the ruling. “Given these facts, there are not sufficient indicia that the conditions the Board imposed in the CP/KCS merger approval are implicated by the increased dwell at UP’s Hollywood Yard.” </p><p>NS filed a complaint last October but eventually reached an agreement with CPKC and dropped the cast. Last month, however, UP filed a new complaint, citing increased dwell times for the containers going on the second train. UP asked the board to launch an investigation. </p><p>The Meridian Speedway is a lynchpin to the pending UP-NS transaction before regulators, a route identified as critical to converting more than 1.17 million truckloads to intermodal over three years. However, UP’s application also called for running 11,000-foot trains, the very length that is at the heart of the dispute. </p><p><i>Contact Ari Ashe at </i><a href="mailto:ari.ashe@spglobal.com"><i>ari.ashe@spglobal.com</i></a><i>.</i> </p></div>

The US Surface Transportation Board (STB) will not intervene in a dispute over the Meridian Speedway, a critical intermodal route connecting the West Coast to the US Southeast where three railroads must team up to execute service. The unanimous ruling, issued Friday, culminates more than six months of arguing between Union Pacific Railroad, Norfolk Southern Railway, and Canadian Pacific Kansas City. CPKC applauded the decision that "exemplifies behavior typical of Union Pacific attempting to bully its way," in a statement. UP, expressing disappointment in the system, told the Journal of Commerce that Canadian Pacific changed operations and service on the line when it acquired Kanas City Southern, but UP also said it was moving on post-decision. The dispute boiled over last summer when FedEx and UPS trucked cargo around the stretch of track to bypass the disruptions. The two parcel giants lean on the railroads to move parcels across the US and impose stringent requirements for on-time performance in their service agreements. The Meridian Speedway, a nearly 300-mile stretch between Louisiana and Mississippi, is a joint venture in which CPKC controls 70% and Norfolk Southern controls the remaining 30%. CPKC oversees dispatching and operations. The Meridian Speedway slashes more than three days between Los Angeles and Atlanta compared with going through Memphis. The dispute centers around CPKC’s decision to restrict train lengths to 8,500 feet, while UP and NS prefer trains that are 11,000 feet long. UP argues the restriction forces them to break up the containers into two different blocks, and CPKC provides substandard service on the second train. CPKC counters that most of the sidings — akin to the shoulder of a highway — are not long enough to handle an 11,000-foot train. When there is a conflict between two trains, the CPKC train is often the one stopped for hours at a time to let the 11,000-foot UP train pass. In an unanimous decision, though, the STB decided not to intervene. “As CPKC notes, the increased dwell of UP’s ‘second train’ could also be attributable to an agreement between CPKC and [Norfolk Southern] that the second train would be scheduled to depart four hours and forty minutes after the first,” STB wrote in the ruling. “Given these facts, there are not sufficient indicia that the conditions the Board imposed in the CP/KCS merger approval are implicated by the increased dwell at UP’s Hollywood Yard.” NS filed a complaint last October but eventually reached an agreement with CPKC and dropped the cast. Last month, however, UP filed a new complaint, citing increased dwell times for the containers going on the second train. UP asked the board to launch an investigation. The Meridian Speedway is a lynchpin to the pending UP-NS transaction before regulators, a route identified as critical to converting more than 1.17 million truckloads to intermodal over three years. However, UP’s application also called for running 11,000-foot trains, the very length that is at the heart of the dispute. Contact Ari Ashe at ari.ashe@spglobal.com .

Rail News

STB declines to intervene on Meridian Speedway dispute

<div class="phx-topic abstract-wrapper"><p>The UP-NS merger and ONE’s Seaspan stake look like separate deals in separate industries, but they are the same move, writes Paul Tonsager. </p></div>

The UP-NS merger and ONE’s Seaspan stake look like separate deals in separate industries, but they are the same move, writes Paul Tonsager.

<div class="phx-topic"><p>Two consequential infrastructure transactions are moving simultaneously through their respective regulatory processes, in separate industries, with a single and critical purpose: Secure assets and expand infrastructure.  </p><p>In rail, Union Pacific (UP) and Norfolk Southern (NS) are advancing a proposed $85 billion merger that would unite UP’s western network with NS’ eastern footprint into a single system spanning 43 states. The Surface Transportation Board (STB) rejected the initial application in January as incomplete; the carriers have committed to refiling by April 30, 2026. </p><div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6186769_0.1.jpg"></img></div><p>In ocean, Ocean Network Express <a href="https://www.joc.com/article/one-boosts-ownership-stake-in-seaspan-parent-poseidon-6184045">has agreed to increase its ownership stake in Poseidon Corp.</a> — parent company of Seaspan Corporation, the world’s largest independent containership lessor — to 48.9%. ONE is a Singapore-based joint venture of three Japanese shipping conglomerates; Poseidon is incorporated in the Marshall Islands and tax-resident in the United Kingdom. The regulatory approvals cited in the announcement almost certainly refer to Japan’s competition authority and possibly the EU — not the United States, which has no STB equivalent for ocean shipping. That gap is part of the story. </p><p>Also in ocean: Hapag-Lloyd, Germany’s largest carrier, <a href="https://www.joc.com/article/hapag-lloyd-bolsters-fleet-with-42-billion-deal-to-acquire-zim-6170540">has agreed to acquire ZIM Integrated Shipping Services in a deal valued at approximately $4.2 billion</a>, a transaction that would create a combined fleet exceeding 4.8 million TEUs. Hapag-Lloyd is one of Seaspan’s charter customers, along with MSC, Maersk, CMA CGM, Cosco, Evergreen and ONE. The world’s seven largest container lines all rent tonnage from the platform that ONE is moving to control. That fact has not appeared in any headline covering this transaction. </p><p>The surface details differ. The underlying logic is identical: the dominant players in each mode are moving to consolidate control of the infrastructure layer that competitors depend on. The difference is that one transaction faces a rigorous, public, multi-year regulatory process. The other faces comparatively limited scrutiny from any authority with real enforcement power over the US freight market. </p><h3>The network versus the tonnage platform </h3><p>In rail, the infrastructure being consolidated is the network itself. A UP-NS combination would create a single operator controlling track, terminals and dispatch authority across the full breadth of the country. For shippers benefiting from UP-NS interchange competition on transcontinental lanes, the merger eliminates a competitive option that cannot be recreated once it closes. </p><p>In ocean, the infrastructure being consolidated is the tonnage platform. Seaspan owns 241 vessels with more than 2.5 million TEUs of capacity and charters them to virtually every major container line. ONE, approaching half-ownership of Seaspan’s parent, is not acquiring a competitor’s ships. It is acquiring a structural position in the platform that determines which carrier gets what vessel, at what charter rate, on what timeline. The rail analog is TTX Company, the carrier-owned flatcar cooperative whose shareholders — BNSF, UP, NS among them — own the equipment pool that their competitors must also rent. ONE’s Seaspan stake is the TTX play, extended to the vessel market. </p><h3>The 48.9% question </h3><p>ONE’s ownership threshold is a deliberate structural choice. Crossing 50% would likely require consolidation of Poseidon’s debt-heavy balance sheet onto ONE’s financial statements and would reframe the transaction — from a minority investment to a control acquisition of the dominant vessel-leasing platform — in ways that invite harder antitrust scrutiny in Japan and the EU. At 48.9%, ONE secures board influence and fleet planning access without pulling those triggers. </p><p>The equity is entirely private — Atlas Corp., Seaspan’s parent company, was delisted in 2023. The primary seller was Fairfax Financial Holdings, run by Prem Watsa, which sold a 23.2% stake but retains approximately 22.1% of Poseidon. Watsa is choosing his partner, not his exit. Any future move toward majority control runs through him and the remaining insiders — on their timeline, at their price. </p><h3>What shippers are actually facing </h3><p>Considered individually, neither the UP-NS combination nor the ONE-Seaspan stake is disqualifying. Considered together — alongside Hapag-Lloyd’s pending acquisition of ZIM — they describe a synchronized compression of freight infrastructure across two modes simultaneously. </p><p>Shippers with rail exposure on transcontinental lanes face a market in which UP and NS no longer compete at interchange. Shippers dependent on ocean capacity face a market in which the largest vessel lessor is approaching control by one of its own customers. For manufacturers, retailers and agricultural exporters moving product across both modes — which describes most significant US freight — the implications compound. </p><p>The STB’s <a href="https://www.joc.com/article/industry-stakeholders-dont-see-regulators-rubber-stamping-up-ns-deal-6181218">rejection of the UP-NS application</a> signals that rigorous competitive impact analysis is required before major rail transactions proceed. No equivalent process exists for the ONE-Seaspan transaction in the United States. The Federal Maritime Commission has limited authority over foreign vessel ownership structures. The transaction will be decided in Tokyo, Brussels and Hamilton — not Washington. </p><p>Two modes. Two mechanisms. One direction. The infrastructure consolidation story of 2026 is not being told as a single story. It should be. </p><p><i>Paul Tonsager has held executive roles at Maersk, CN Rail, CN Worldwide, Coyote (RXO) and Patriot Rail. He is the founder of Integrated Multimodal Solutions LLC and author of the Substack newsletter Signals &amp; Switches. Contact him at </i><a href="mailto:paul.tonsager@multimodalsolutions.io"><i>paul.tonsager@multimodalsolutions.io</i></a><i>.</i>  </p></div>

Two consequential infrastructure transactions are moving simultaneously through their respective regulatory processes, in separate industries, with a single and critical purpose: Secure assets and expand infrastructure. In rail, Union Pacific (UP) and Norfolk Southern (NS) are advancing a proposed $85 billion merger that would unite UP’s western network with NS’ eastern footprint into a single system spanning 43 states. The Surface Transportation Board (STB) rejected the initial application in January as incomplete; the carriers have committed to refiling by April 30, 2026. In ocean, Ocean Network Express has agreed to increase its ownership stake in Poseidon Corp. — parent company of Seaspan Corporation, the world’s largest independent containership lessor — to 48.9%. ONE is a Singapore-based joint venture of three Japanese shipping conglomerates; Poseidon is incorporated in the Marshall Islands and tax-resident in the United Kingdom. The regulatory approvals cited in the announcement almost certainly refer to Japan’s competition authority and possibly the EU — not the United States, which has no STB equivalent for ocean shipping. That gap is part of the story. Also in ocean: Hapag-Lloyd, Germany’s largest carrier, has agreed to acquire ZIM Integrated Shipping Services in a deal valued at approximately $4.2 billion , a transaction that would create a combined fleet exceeding 4.8 million TEUs. Hapag-Lloyd is one of Seaspan’s charter customers, along with MSC, Maersk, CMA CGM, Cosco, Evergreen and ONE. The world’s seven largest container lines all rent tonnage from the platform that ONE is moving to control. That fact has not appeared in any headline covering this transaction. The surface details differ. The underlying logic is identical: the dominant players in each mode are moving to consolidate control of the infrastructure layer that competitors depend on. The difference is that one transaction faces a rigorous, public, multi-year regulatory process. The other faces comparatively limited scrutiny from any authority with real enforcement power over the US freight market. The network versus the tonnage platform In rail, the infrastructure being consolidated is the network itself. A UP-NS combination would create a single operator controlling track, terminals and dispatch authority across the full breadth of the country. For shippers benefiting from UP-NS interchange competition on transcontinental lanes, the merger eliminates a competitive option that cannot be recreated once it closes. In ocean, the infrastructure being consolidated is the tonnage platform. Seaspan owns 241 vessels with more than 2.5 million TEUs of capacity and charters them to virtually every major container line. ONE, approaching half-ownership of Seaspan’s parent, is not acquiring a competitor’s ships. It is acquiring a structural position in the platform that determines which carrier gets what vessel, at what charter rate, on what timeline. The rail analog is TTX Company, the carrier-owned flatcar cooperative whose shareholders — BNSF, UP, NS among them — own the equipment pool that their competitors must also rent. ONE’s Seaspan stake is the TTX play, extended to the vessel market. The 48.9% question ONE’s ownership threshold is a deliberate structural choice. Crossing 50% would likely require consolidation of Poseidon’s debt-heavy balance sheet onto ONE’s financial statements and would reframe the transaction — from a minority investment to a control acquisition of the dominant vessel-leasing platform — in ways that invite harder antitrust scrutiny in Japan and the EU. At 48.9%, ONE secures board influence and fleet planning access without pulling those triggers. The equity is entirely private — Atlas Corp., Seaspan’s parent company, was delisted in 2023. The primary seller was Fairfax Financial Holdings, run by Prem Watsa, which sold a 23.2% stake but retains approximately 22.1% of Poseidon. Watsa is choosing his partner, not his exit. Any future move toward majority control runs through him and the remaining insiders — on their timeline, at their price. What shippers are actually facing Considered individually, neither the UP-NS combination nor the ONE-Seaspan stake is disqualifying. Considered together — alongside Hapag-Lloyd’s pending acquisition of ZIM — they describe a synchronized compression of freight infrastructure across two modes simultaneously. Shippers with rail exposure on transcontinental lanes face a market in which UP and NS no longer compete at interchange. Shippers dependent on ocean capacity face a market in which the largest vessel lessor is approaching control by one of its own customers. For manufacturers, retailers and agricultural exporters moving product across both modes — which describes most significant US freight — the implications compound. The STB’s rejection of the UP-NS application signals that rigorous competitive impact analysis is required before major rail transactions proceed. No equivalent process exists for the ONE-Seaspan transaction in the United States. The Federal Maritime Commission has limited authority over foreign vessel ownership structures. The transaction will be decided in Tokyo, Brussels and Hamilton — not Washington. Two modes. Two mechanisms. One direction. The infrastructure consolidation story of 2026 is not being told as a single story. It should be. Paul Tonsager has held executive roles at Maersk, CN Rail, CN Worldwide, Coyote (RXO) and Patriot Rail. He is the founder of Integrated Multimodal Solutions LLC and author of the Substack newsletter Signals & Switches. Contact him at paul.tonsager@multimodalsolutions.io .

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Rail and ocean carriers consolidating shipping infrastructure: analyst

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