<div class="phx-topic abstract-wrapper">The creation was propelled by need: the supply from chassis providers has not kept pace with the explosive growth at the region’s ports, a Georgia official said.</div>

The creation was propelled by need: the supply from chassis providers has not kept pace with the explosive growth at the region’s ports, a Georgia official said.

<div><div><img></div>The chassis pool would supplement the existing fleet operated by the South Atlantic Chassis Pool. Photo credit: Shutterstock.The port authorities running the <a>Savannah</a> and <a>Charleston</a> ports, concerned about the quality and <a>availability of chassis</a> to serve their growing volume are working to create a new chassis pool with a goal of adding 10,000 chassis or 25 percent more to the market by July 1.The pool would supplement the existing fleet operated by the <a>South Atlantic Chassis Pool</a> (SACP), which encompasses a wide territory from Wilmington, North Carolina, to Jacksonville and west to Atlanta, but would potentially be more limited in...

The chassis pool would supplement the existing fleet operated by the South Atlantic Chassis Pool. Photo credit: Shutterstock. The port authorities running the Savannah and Charleston ports, concerned about the quality and availability of chassis to serve their growing volume are working to create a new chassis pool with a goal of adding 10,000 chassis or 25 percent more to the market by July 1. The pool would supplement the existing fleet operated by the South Atlantic Chassis Pool (SACP), which encompasses a wide territory from Wilmington, North Carolina, to Jacksonville and west to Atlanta, but would potentially be more limited in geographic scope. Georgia Ports Authority (GPA) executive director Griff Lynch told the 50th Georgia Foreign Trade Conference at Sea Island on Monday that other Southeast ports would be invited to join but that if others declined to participate “we’ll go forward without them.” Most chassis at the ports now are provided by the SACP, one of six regional cooperative pools managed by Consolidated Chassis Management, a subsidiary of the Ocean Carrier Equipment Management Association (OCEMA), whose members are major container lines. Lynch said supply from chassis providers has not kept pace with explosive growth at the region’s ports. Last year, total TEU volumes grew 11 percent through Savannah and 9 percent through Charleston, while the chassis fleet barely grew, he said. “The system is broken,” Lynch said. “We keep growing and we don’t have more equipment, so we have a problem.” “We’re at a bit of a standstill right now because what is happening is the folks that provide the chassis don’t necessarily want to put more chassis in unless they can get an adequate return on their investment,” Lynch said. Jim Newsome, CEO of the South Carolina Ports Authority , said the SACP “has been a significantly positive factor in the growth of containerized trade in the Southeast United States due to its regional coverage. Like all innovative concepts, time leads to the necessity to review the way forward. This includes reviewing the overall governance, structure, and approach, [and] encouraging the injection of more chassis assets to support further growth.” The new pool would be a departure from existing pool arrangements, starting with the idea that it could be not for profit, Lynch said. “We are going to re-invent the way we do the pool,” he said. Newsome said he envisions the new pool “mandating improved quality standards for the fleet in terms of age, tire quality, etc, and assuring that all users of chassis benefit from access to chassis at the lowest possible cost. “We are working closely and with urgency with the GPA, the [intermodal equipment providers], and OCEMA to define a better way forward quickly to support the region’s containerized trade growth,” Newsome said. “We will accomplish this within the course of this year. Lynch said, “The chassis pool that we’re going to roll out will be better than the current SACP model. It’s going to upgrade the chassis fleet to have all the things we want to see — radials to handle the heavy exports, ABS [anti-lock/anti-skid] brakes, to have a high-quality pool that so that when a truck driver takes a chassis they don’t have to worry about maintenance and repair.” The operational details of the new entity have yet to be disclosed, but at least one lessor was supportive of the plan. "The GPA and SCSPA have clearly laid out out their vision to meet the needs of our mutual international supply chain customers," Greg Moore, executive vice president of Flexi-Van. "We are prepared to support their vision and will contribute to this positive development." Contact Peter Tirschwell at peter.tirschwell@ihsmarkit.com and follow him on Twitter: @petertirschwell .

Logistics Technology News

Drayage

Savannah, Charleston ports to launch new chassis pool

<div class="phx-topic abstract-wrapper">The global chief economist for S&amp;P Global Ratings told TPM26 the uncertainties that come with current White House policies are part of the mix when formulating economic forecasts.</div>

The global chief economist for S&P Global Ratings told TPM26 the uncertainties that come with current White House policies are part of the mix when formulating economic forecasts.

Feature image

<div class="phx-topic">Long Beach, Calif. — The unpredictable nature of the Trump administration is simply a given that needs to be taken into account when generating economic forecasts, the global chief economist for S&amp;P Global Ratings said Monday. Dr. Paul Gruenwald, speaking at the Journal of Commerce’s TPM26 conference, presented a general overview of the US and world economies. He gave a cautiously optimistic presentation, but said there is uncertainty and the possibility of change in many areas, in particular when it comes to US policies. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177002_0.1.jpg"></img></div>”I like to say that (with) US policy, unpredictability is a feature, not a bug, in this administration,” Gruenwald said. “So that’s kind of the operating model, and we’re going to continue to work with that.” Pointing to the US/Israeli military action against Iran, US tariffs and economic sanctions, trade uncertainty, and other periodic disruptions, Gruenwald is forecasting that US economic growth will likely be more than 2% in 2026, but with lower job creation. "We're going to have to think hard about the big events over the last week, the attack on Iran, higher oil prices, a stronger dollar, lower to flat treasuries. If this lasts, higher oil prices are like a tax on growth," he said. "Obviously, the physical disruption of oil is going to have an impact. So right now, that's a downside risk, but we will be looking to incorporate that into our scenarios as you go through this round." Gruenwald said 2025 finished stronger than expected despite the uncertainty over tariffs and other trade disputes because it is difficult to change the overall direction of a $30 trillion dollar a year economy, while trading partners such as China, Canada, Mexico, and Vietnam are adjusting on the fly to the Trump administration policies. He said because of the Trump administration’s immigration crackdown, the US economy is creating fewer jobs per month than previous administrations, but 50,000 jobs per month is adequate to maintain the current 4.3% unemployment rate. “The labor market headline number 4.3% unemployment looks good, but if you look at it sector by sector, there's only one sector in the US that's adding jobs right now, that's healthcare,” Gruenwald said. “Tech is losing jobs, manufacturing is losing jobs, government's losing jobs. Education is kind of a wash, but we've got a very narrow base for our reasonably strong economy right now.” <h3>Interest rate cuts likely later this year </h3>Gruenwald told TPM26 there is room for the Federal Reserve to cut interest rates by 50 basis points in the future, but noted there is no hurry to do that. “We’ve got a couple of cuts from the Fed coming later in the year,” he said. Gruenwald said one of the high points in the economy that is helping to keep it relatively strong is the billions of dollars being invested by tech companies and others in artificial intelligence, which proponents believe will make the economy more efficient in the long run. "It's moving the macro needle in a big way,” he said. “The data centers are not just the physical construction. It's the software, it's the hardware, it's the racks, it's the servers, it's the HVAC, it's the cooling, it's the water, it's the power, it's everything else. “This is probably going to last for a couple of years, but when that's finished, we are going to need these operations to deliver the returns that are currently priced in, and as Secretary Yellen said, deliver some of these productivity gains over time," Gruenwald added. Contact Dan Ronan at <a href="mailto:contactdanronan@gmail.com">contactdanronan@gmail.com.</a></div>

Long Beach, Calif. — The unpredictable nature of the Trump administration is simply a given that needs to be taken into account when generating economic forecasts, the global chief economist for S&P Global Ratings said Monday. Dr. Paul Gruenwald, speaking at the Journal of Commerce’s TPM26 conference, presented a general overview of the US and world economies. He gave a cautiously optimistic presentation, but said there is uncertainty and the possibility of change in many areas, in particular when it comes to US policies. ”I like to say that (with) US policy, unpredictability is a feature, not a bug, in this administration,” Gruenwald said. “So that’s kind of the operating model, and we’re going to continue to work with that.” Pointing to the US/Israeli military action against Iran, US tariffs and economic sanctions, trade uncertainty, and other periodic disruptions, Gruenwald is forecasting that US economic growth will likely be more than 2% in 2026, but with lower job creation. "We're going to have to think hard about the big events over the last week, the attack on Iran, higher oil prices, a stronger dollar, lower to flat treasuries. If this lasts, higher oil prices are like a tax on growth," he said. "Obviously, the physical disruption of oil is going to have an impact. So right now, that's a downside risk, but we will be looking to incorporate that into our scenarios as you go through this round." Gruenwald said 2025 finished stronger than expected despite the uncertainty over tariffs and other trade disputes because it is difficult to change the overall direction of a $30 trillion dollar a year economy, while trading partners such as China, Canada, Mexico, and Vietnam are adjusting on the fly to the Trump administration policies. He said because of the Trump administration’s immigration crackdown, the US economy is creating fewer jobs per month than previous administrations, but 50,000 jobs per month is adequate to maintain the current 4.3% unemployment rate. “The labor market headline number 4.3% unemployment looks good, but if you look at it sector by sector, there's only one sector in the US that's adding jobs right now, that's healthcare,” Gruenwald said. “Tech is losing jobs, manufacturing is losing jobs, government's losing jobs. Education is kind of a wash, but we've got a very narrow base for our reasonably strong economy right now.” Interest rate cuts likely later this year Gruenwald told TPM26 there is room for the Federal Reserve to cut interest rates by 50 basis points in the future, but noted there is no hurry to do that. “We’ve got a couple of cuts from the Fed coming later in the year,” he said. Gruenwald said one of the high points in the economy that is helping to keep it relatively strong is the billions of dollars being invested by tech companies and others in artificial intelligence, which proponents believe will make the economy more efficient in the long run. "It's moving the macro needle in a big way,” he said. “The data centers are not just the physical construction. It's the software, it's the hardware, it's the racks, it's the servers, it's the HVAC, it's the cooling, it's the water, it's the power, it's everything else. “This is probably going to last for a couple of years, but when that's finished, we are going to need these operations to deliver the returns that are currently priced in, and as Secretary Yellen said, deliver some of these productivity gains over time," Gruenwald added. Contact Dan Ronan at contactdanronan@gmail.com.

Transport, Trade and Regulation News

Supply chain

TPM26: Unpredictability the ‘operating model’ for Trump administration: economist

<div class="phx-topic abstract-wrapper">The ex-US Treasury Secretary said consumers could pull back on spending should crude oil and gasoline prices remain aloft due to the latest attacks on Iran by the US and Israel. </div>

The ex-US Treasury Secretary said consumers could pull back on spending should crude oil and gasoline prices remain aloft due to the latest attacks on Iran by the US and Israel.

<div class="phx-topic">Long Beach, California — The duration of US and Israeli attacks on Iran and the effect on oil prices threaten to push inflation higher and jeopardize the modest growth expected in global container shipping demand for 2026, former US Treasury Secretary Janet Yellen said Monday. Front-month crude oil futures jumped to their highest level in more than a year Monday due to the weekend attacks on Iran. Yellen, speaking during her keynote address at the start of the Journal of Commerce’s TPM26 conference, said the 14 million barrels of crude that flow through the Strait of Hormuz daily have been cut to a trickle, a development that bears watching. <div class="wrapper-narrow float-right-element"><img src="/images/phoenix/6177002_0.1.jpg"></img></div>“The risk to the global economy will depend on how long energy flows through the Strait of Hormuz are disrupted,” Yellen, also former chairperson of the US Federal Reserve, said. “If oil prices do remain higher, then we will really need to worry about the impact on inflation over the next year and it’s likely to have negative consequences for growth.” Container shipping demand is expected to increase 1.7% globally this year, according to a forecast from S&amp;P Global Maritime, Trade and Supply Chain, a sister company of the Journal of Commerce. Most of that growth will occur outside of the US, which is likely to see flat results compared with 2025. The US economy is demonstrating some strength, Yellen said, with a low 4.3% unemployment rate, a tapering inflation rate of 3%, and gross domestic product (GDP) expected to grow at a similar rate in the first quarter. However, underneath those figures, Yellen said there are signs of fragility that could upend that growth. The monthly creation of 15,000 jobs in the US in 2025 remains well below trend. She added that consumer spending growth rests largely on high earners, with the top 10% of US household incomes now accounting for half of retail spending. “We have a K-shaped economy and an expansion [in which] upper income households are doing well,” Yellen said. “They’re in good financial shape and driving consumer spending.” <h3>Fed could be cautious about new rate cuts </h3>The Supreme Court’s recent decision to strike down the Trump administration’s emergency tariff powers could cut the inflation rate modestly in 2026. But with oil prices having the opposite effect, the Federal Reserve may become more cautious about further interest rate cuts, Yellen said. The Fed’s key overnight lending rate, which currently sits between 3.5% and 3.75%, is a driver of mortgage rates and interest on other types of consumer loans. Trump has been browbeating the Fed to bring its key rates below 2% in a bid to stimulate the US economy. “The Fed is terribly worried that it’s not yet gotten inflation back to its target of 2%,” Yellen told TPM26. “It’s not realistic that we’re going to go back to 2% right now. I think the recent Iran situation puts the Fed even more on hold, more reluctant to cut rates.” Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

Long Beach, California — The duration of US and Israeli attacks on Iran and the effect on oil prices threaten to push inflation higher and jeopardize the modest growth expected in global container shipping demand for 2026, former US Treasury Secretary Janet Yellen said Monday. Front-month crude oil futures jumped to their highest level in more than a year Monday due to the weekend attacks on Iran. Yellen, speaking during her keynote address at the start of the Journal of Commerce’s TPM26 conference, said the 14 million barrels of crude that flow through the Strait of Hormuz daily have been cut to a trickle, a development that bears watching. “The risk to the global economy will depend on how long energy flows through the Strait of Hormuz are disrupted,” Yellen, also former chairperson of the US Federal Reserve, said. “If oil prices do remain higher, then we will really need to worry about the impact on inflation over the next year and it’s likely to have negative consequences for growth.” Container shipping demand is expected to increase 1.7% globally this year, according to a forecast from S&P Global Maritime, Trade and Supply Chain, a sister company of the Journal of Commerce. Most of that growth will occur outside of the US, which is likely to see flat results compared with 2025. The US economy is demonstrating some strength, Yellen said, with a low 4.3% unemployment rate, a tapering inflation rate of 3%, and gross domestic product (GDP) expected to grow at a similar rate in the first quarter. However, underneath those figures, Yellen said there are signs of fragility that could upend that growth. The monthly creation of 15,000 jobs in the US in 2025 remains well below trend. She added that consumer spending growth rests largely on high earners, with the top 10% of US household incomes now accounting for half of retail spending. “We have a K-shaped economy and an expansion [in which] upper income households are doing well,” Yellen said. “They’re in good financial shape and driving consumer spending.” Fed could be cautious about new rate cuts The Supreme Court’s recent decision to strike down the Trump administration’s emergency tariff powers could cut the inflation rate modestly in 2026. But with oil prices having the opposite effect, the Federal Reserve may become more cautious about further interest rate cuts, Yellen said. The Fed’s key overnight lending rate, which currently sits between 3.5% and 3.75%, is a driver of mortgage rates and interest on other types of consumer loans. Trump has been browbeating the Fed to bring its key rates below 2% in a bid to stimulate the US economy. “The Fed is terribly worried that it’s not yet gotten inflation back to its target of 2%,” Yellen told TPM26. “It’s not realistic that we’re going to go back to 2% right now. I think the recent Iran situation puts the Fed even more on hold, more reluctant to cut rates.” Contact Michael Angell at michael.angell@spglobal.com .

Container Shipping News

Maritime

TPM26: Iran conflict puts new risk on US economic growth: Yellen 

<div class="phx-topic abstract-wrapper">The move comes as transshipment cargo handling declines are expected at Indian ports following a recent government decision to revoke the cabotage waiver that foreign-flag carriers have enjoyed since 2018.</div>

The move comes as transshipment cargo handling declines are expected at Indian ports following a recent government decision to revoke the cabotage waiver that foreign-flag carriers have enjoyed since 2018.

<div class="phx-topic">Mediterranean Shipping Co. is set to implement significant capacity cuts on trades from India to North Europe and the Mediterranean as incremental regional volumes tighten, multiple industry sources told the Journal of Commerce. The Geneva-based liner serves those trades via its Himalaya Express (HEX) and IPAK services, with the latter operated in a consortium arrangement with the Shipping Corporation of India (SCI). Sources have confirmed that the average capacity of vessels deployed on the HEX will be slashed from 14,000 TEUs to about 9,000 TEUs, while on the IPAK, the average MSC tonnage size will decrease from 9,000 TEUs to 8,000 TEUs. The capacity rejigging is expected to kick in through March. Indian allocations will be proportionately adjusted downward to right-size vessel operations, sources said. A minor rotation reshuffle is also in the cards for the network, with the HEX replacing the Valencia stop in Spain with a call to Sines in Portugal, they added. Efforts to seek comment from MSC were unsuccessful. The HEX has been an industry-leading, high-capacity network on the trade lane, using ultra-large vessels that have included calls in the range of 16,000 TEUs to 20,000 TEUs. <h3>Cabotage policy reset expected to take place next month </h3>The network reconfigurations come in the wake of anticipated transshipment cargo handling declines at Indian ports following a recent government decision <a href="https://www.joc.com/article/india-advances-launch-of-state-container-line-after-cabotage-rule-rewind-6164914">to revoke the cabotage waiver</a> that foreign-flag carriers have enjoyed since 2018. The policy reset, due to take effect next month, is arguably intended to encourage Indian vessel fleet development. MSC has had high stakes in regional container relays through several Indian gateways, particularly out of Mundra and Vizhinjam, riding on its strategic partnerships with local terminal partner Adani Ports. Ironically, MSC last year reorganized the HEX berthing window in India’s Nhava Port by shifting calls from the DP World terminal to PSA International’s capacity-rich facility for greater operational flexibility in tandem with growing vessel sizes; a call there from the 24,346-TEU MSC Micol in December was one notable example. Meanwhile, the reversal of cabotage relaxations for foreign tonnage has stoked an old industry debate centering on trade protectionism, with representatives of the Container Shipping Lines’ Association (India) warning that the policy U-turn could undermine the hub progress Indian ports have made in recent years by refueling a shift of transshipment volumes to regional competitors, especially Colombo Port in Sri Lanka. “In the absence of this waiver, the proposed expansion plans in some of the ports like Mundra and Vizhinjam might not be implemented, thereby further constraining vessel calls and transshipment,” the liner group said. Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>.</div>

Mediterranean Shipping Co. is set to implement significant capacity cuts on trades from India to North Europe and the Mediterranean as incremental regional volumes tighten, multiple industry sources told the Journal of Commerce. The Geneva-based liner serves those trades via its Himalaya Express (HEX) and IPAK services, with the latter operated in a consortium arrangement with the Shipping Corporation of India (SCI). Sources have confirmed that the average capacity of vessels deployed on the HEX will be slashed from 14,000 TEUs to about 9,000 TEUs, while on the IPAK, the average MSC tonnage size will decrease from 9,000 TEUs to 8,000 TEUs. The capacity rejigging is expected to kick in through March. Indian allocations will be proportionately adjusted downward to right-size vessel operations, sources said. A minor rotation reshuffle is also in the cards for the network, with the HEX replacing the Valencia stop in Spain with a call to Sines in Portugal, they added. Efforts to seek comment from MSC were unsuccessful. The HEX has been an industry-leading, high-capacity network on the trade lane, using ultra-large vessels that have included calls in the range of 16,000 TEUs to 20,000 TEUs. Cabotage policy reset expected to take place next month The network reconfigurations come in the wake of anticipated transshipment cargo handling declines at Indian ports following a recent government decision to revoke the cabotage waiver that foreign-flag carriers have enjoyed since 2018. The policy reset, due to take effect next month, is arguably intended to encourage Indian vessel fleet development. MSC has had high stakes in regional container relays through several Indian gateways, particularly out of Mundra and Vizhinjam, riding on its strategic partnerships with local terminal partner Adani Ports. Ironically, MSC last year reorganized the HEX berthing window in India’s Nhava Port by shifting calls from the DP World terminal to PSA International’s capacity-rich facility for greater operational flexibility in tandem with growing vessel sizes; a call there from the 24,346-TEU MSC Micol in December was one notable example. Meanwhile, the reversal of cabotage relaxations for foreign tonnage has stoked an old industry debate centering on trade protectionism, with representatives of the Container Shipping Lines’ Association (India) warning that the policy U-turn could undermine the hub progress Indian ports have made in recent years by refueling a shift of transshipment volumes to regional competitors, especially Colombo Port in Sri Lanka. “In the absence of this waiver, the proposed expansion plans in some of the ports like Mundra and Vizhinjam might not be implemented, thereby further constraining vessel calls and transshipment,” the liner group said. Contact Bency Mathew at bencyvmathew@gmail.com .

Port News

Container lines

International ports

MSC downgrades India-Europe/Med network amid transshipment cargo lift woes

<div class="phx-topic abstract-wrapper">Cuts to traditional one-way service have been balanced by additional capacity in dedicated, specialized fleets.</div>

Cuts to traditional one-way service have been balanced by additional capacity in dedicated, specialized fleets.

<div class="phx-topic">Large US truckload carriers put enough additional trucks on the road late last year to boost the Journal of Commerce Truckload Capacity Index (TCI) slightly, despite ongoing cuts in capacity at many companies amid rising spot rates and volatile demand. Those trucks, however, were mostly destined for higher-paying dedicated and specialized services, not one-way truckload service. The quarterly TCI rose sequentially from 72.4% in the third quarter to 73.5% in the fourth quarter, as the collective capacity fielded by the large carriers in the index increased 1.5%. But carriers weren’t rushing to throw additional trucks at <a href="https://www.joc.com/article/us-truckload-pricing-remains-unsettled-despite-red-hot-december-6148317">higher spot market rates</a>. The fourth-quarter reading is still the second-lowest for the index since the fourth quarter of 2013, when the TCI dropped to 73.8% — the index’s 19-year floor until last year. The index, which is based on average truck counts in the 2006 fourth quarter, climbed to a peak of 93.2% in the 2022 second quarter before plunging over the next three years. <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="1c27408c-a4a7-4bbf-84f5-4fe3e53846e0"></dynamic-object></div>The latest index shows large carriers keeping a tight grip on their available capacity amid volatile supply and demand. Some truckload companies in the index group continued to shrink their fleets, while others saw chances to pursue more specialized freight. “We made a decision to strategically restructure our one-way trucking business to be even more targeted towards specialized expedited, cross-border Mexico and engineered business,” Derek Leathers, chairman and CEO of Werner Enterprises, said Feb. 5. <h3>Dedicated acquisition </h3>Werner is moving deeper into dedicated trucking by acquiring FirstFleet, a 2,400-tractor dedicated fleet provider with $615 million in annual revenue. The deal, announced Jan. 28, will increase Werner’s dedicated trucking revenue by 50%, the company said. “We’re not abandoning one-way, but we are a leaner, more agile version of ourselves,” Leathers told Wall Street analysts in an earning conference call. Werner reduced its number of trucks in one-way service 13.8% year over year in the fourth quarter. The company — which is part of the Journal of Commerce index group — increased its dedicated truck count by less than 1% year over year in the fourth quarter, according to its earnings report. With FirstFleet, that dedicated truck count will rise 50% past 7,000. Another TCI group carrier, Covenant Logistics, increased its fleet count slightly in the fourth quarter on a year-over-year basis, according to its earnings report. In early 2026, the company is experiencing what it called a sharp increase in shipper bid activity. Even so, Covenant plans to sell and not replace a number of trucks. “We expect a modestly smaller fleet at the end of 2026 and only $40 million to $50 million of net capex for the year,” CFO James S. Grant said during a Jan. 30 earnings conference call. Similar to larger competitor Werner, Covenant is acquiring business. In the fourth quarter, the company purchased a small truckload brokerage with two niche customer bases: state and federal disaster relief and high-service consumer packaged goods. Truck fleet cuts and additions are occurring as executives at large truckload carriers expect tightening capacity to <a href="https://www.joc.com/article/trucking-executives-buoyed-by-market-signals-as-winter-exit-nears-6172398">flip the truck market</a> in their favor after a three-year freight downturn. Publicly-owned carriers are beginning to report low single-digit contract rate increases. An ongoing government crackdown on truck driver English language proficiency, <a href="https://www.joc.com/article/usdot-releases-interim-final-rule-on-non-domiciled-cdl-holders-6169023">non-domiciled commercial driver’s licenses (CDLs)</a>, substandard CDL schools and electronic logging devices is expected to drive more small carriers out of the market. Shippers are increasingly concerned about capacity and cargo security, Covenant executives said. “What I’m seeing people say, especially, [is] I need a high-value program, I need assets,” President M. Paul Bunn said during the earnings call. Contact William B. Cassidy at <a href="mailto:bill.cassidy@spglobal.com">bill.cassidy@spglobal.com</a>.</div>

Large US truckload carriers put enough additional trucks on the road late last year to boost the Journal of Commerce Truckload Capacity Index (TCI) slightly, despite ongoing cuts in capacity at many companies amid rising spot rates and volatile demand. Those trucks, however, were mostly destined for higher-paying dedicated and specialized services, not one-way truckload service. The quarterly TCI rose sequentially from 72.4% in the third quarter to 73.5% in the fourth quarter, as the collective capacity fielded by the large carriers in the index increased 1.5%. But carriers weren’t rushing to throw additional trucks at higher spot market rates . The fourth-quarter reading is still the second-lowest for the index since the fourth quarter of 2013, when the TCI dropped to 73.8% — the index’s 19-year floor until last year. The index, which is based on average truck counts in the 2006 fourth quarter, climbed to a peak of 93.2% in the 2022 second quarter before plunging over the next three years. The latest index shows large carriers keeping a tight grip on their available capacity amid volatile supply and demand. Some truckload companies in the index group continued to shrink their fleets, while others saw chances to pursue more specialized freight. “We made a decision to strategically restructure our one-way trucking business to be even more targeted towards specialized expedited, cross-border Mexico and engineered business,” Derek Leathers, chairman and CEO of Werner Enterprises, said Feb. 5. Dedicated acquisition Werner is moving deeper into dedicated trucking by acquiring FirstFleet, a 2,400-tractor dedicated fleet provider with $615 million in annual revenue. The deal, announced Jan. 28, will increase Werner’s dedicated trucking revenue by 50%, the company said. “We’re not abandoning one-way, but we are a leaner, more agile version of ourselves,” Leathers told Wall Street analysts in an earning conference call. Werner reduced its number of trucks in one-way service 13.8% year over year in the fourth quarter. The company — which is part of the Journal of Commerce index group — increased its dedicated truck count by less than 1% year over year in the fourth quarter, according to its earnings report. With FirstFleet, that dedicated truck count will rise 50% past 7,000. Another TCI group carrier, Covenant Logistics, increased its fleet count slightly in the fourth quarter on a year-over-year basis, according to its earnings report. In early 2026, the company is experiencing what it called a sharp increase in shipper bid activity. Even so, Covenant plans to sell and not replace a number of trucks. “We expect a modestly smaller fleet at the end of 2026 and only $40 million to $50 million of net capex for the year,” CFO James S. Grant said during a Jan. 30 earnings conference call. Similar to larger competitor Werner, Covenant is acquiring business. In the fourth quarter, the company purchased a small truckload brokerage with two niche customer bases: state and federal disaster relief and high-service consumer packaged goods. Truck fleet cuts and additions are occurring as executives at large truckload carriers expect tightening capacity to flip the truck market in their favor after a three-year freight downturn. Publicly-owned carriers are beginning to report low single-digit contract rate increases. An ongoing government crackdown on truck driver English language proficiency, non-domiciled commercial driver’s licenses (CDLs) , substandard CDL schools and electronic logging devices is expected to drive more small carriers out of the market. Shippers are increasingly concerned about capacity and cargo security, Covenant executives said. “What I’m seeing people say, especially, [is] I need a high-value program, I need assets,” President M. Paul Bunn said during the earnings call. Contact William B. Cassidy at bill.cassidy@spglobal.com .

Trucking News

Truckload

Surface

Truckload capacity index moves up as large US carriers shuffle assets

<div class="phx-topic abstract-wrapper">The US has established a maritime warning zone, effectively placing the region out of bounds to shipping, while airlines have suspended passenger and freighter flights across the Middle East.</div>

The US has established a maritime warning zone, effectively placing the region out of bounds to shipping, while airlines have suspended passenger and freighter flights across the Middle East.

<div class="phx-topic">Commercial shipping and airlines continued to avoid the Middle East Sunday as the US and Israel launched a second day of massive military strikes on Iran. The bombardment, meanwhile, prompted Tehran-backed Houthi militants in Yemen to threaten retaliation by saying they may resume attacks on commercial shipping in the Red Sea. Airlines have suspended passenger and freighter flights across the Middle East and the US has established a maritime warning zone in the Persian Gulf, Gulf of Oman, North Arabian Sea and the Strait of Hormuz, effectively placing the region out of bounds to shipping. “The establishment of the warning zone is intended to provide notice that dangerous military operations are taking place from within these locations and the US Navy cannot guarantee the safety of neutral or merchant shipping,” Jakob Larsen, chief safety and security officer at BIMCO, said in a statement Saturday. Two Houthi officials speaking on the condition of anonymity on Saturday <a href="https://www.yahoo.com/news/articles/yemens-iranian-backed-houthi-rebels-083643083.html?guccounter=1&amp;guce_referrer=aHR0cHM6Ly93d3cuYmluZy5jb20v&amp;guce_referrer_sig=AQAAAHCSkq524Zuax-7RXYPUHL7WjCXLoDzxDA6oxH9lxQY48Svx1eiq28CB1EPKkJs30ZP9956P-XPnfis5r3FnNU3a4X4GWKphMEAzIxOLvy2kEVrs30VhCmW5QTvk4i_UISC1bNGzJqshxlFkcuwfpiUYmp6_A6xzvpJM1G6XP-8G">told the Associated Press</a> that attacks on commercial shipping in the Bab-el-Madeb Strait could restart as early as “tonight.” Houthi leadership has yet to make an official statement. A fire broke out at the Port of Jebel Ali in Dubai Sunday when debris fell to the ground after a drone launched from Iran was intercepted, according to media reports. No information on damage to the port was immediately available.CMA CGM on Sunday implemented an “emergency conflict surcharge” for the region of $2,000 per TEU, $3,000 per FEU, and $4,000 for refrigerated containers and special equipment. “In continued efforts to ensure the safety of our crew, vessels, and your cargo amid the ongoing developments in Iran and across the Arabian Peninsula, precautionary measures have been taken to safeguard operations in the affected areas,” the carrier said in customer advisory. “We understand these measures may impact your logistics and supply chain operations; however, they are necessary steps that also lead to additional operational costs.” That came a day after CMA CGM ordered 14 vessels inside the Persian Gulf and seven en route to the Gulf to immediately proceed to shelter. The carrier has also suspended all passages through the Red Sea and is rerouting ships around southern Africa. “This decision is dictated by safety considerations and is made in compliance with our Bill of Lading terms and conditions,” CMA CGM said in a statement Saturday. “Customers will be contacted as soon as we have more details of the possible alternative ports where their cargo could be discharged.” Maersk on Sunday said it was rerouting all sailings of its ME11 Middle East-India-Mediterranean service and MECL Middle East-India-US East Coast service back around southern Africa until further notice. That is an escalation <a href="https://www.joc.com/article/maersk-hapag-lloyd-to-reroute-some-march-sailings-away-from-red-seasuez-6177149">from Friday</a>, when the carrier announced select sailings of both services would avoid the Red Sea and Suez through the first half of March. “Once the situation stabilizes and the security situation again permits, we will continue to prioritize the trans-Suez route for ME11 and MECL services as it is the fastest, most sustainable and most efficient way for us to serve our customers,” Maersk said in a statement Sunday. The Houthis have not launched any attacks on shipping since the Gaza ceasefire between Israel and Hamas was announced last October. And while the Houthis’ top leader, Abdul-Malik Badr al-Din al-Houthi, voiced support over the weekend for Iran, he held back on pledging military action, Hisisham al-Omeisy, a geopolitical expert on Yemen, told the Journal of Commerce. Seeing the scale and severity of US and Israel attacks on Iran, the Houthis appear to be calculating their next move, he said. The Houthis understand “going full in at this point will prove to be costly if not suicidal, and may instead resort to measures to save face; the movement has called for public protests in areas under their control in Yemen,” al-Omeisy said. “Nevertheless, Houthis are now under immense pressure to act, and their leadership may still authorize limited strikes on ships or even Tel Aviv." Major container lines have mostly avoided the Red Sea/Suez route since late 2023 when Houthi militants began their attacks on commercial shipping to protest Israel’s move into Gaza, forcing lengthy diversions around southern Africa. Peter Sand, chief analyst for rate benchmarking platform Xeneta, said the military action launched by the US and Israel and Iran’s retaliation will “shatter hopes of a large-scale return of container shipping to the Red Sea” this year. “If Houthi militia resume attacks, as now seems likely, carriers will reverse the decision to return services to the Red Sea and prioritize the safety of crew, ship and cargo,” Sand said in a statement Saturday. “Any plans for a phased return of container shipping to the Red Sea in 2026 will be shelved until the security situation becomes clearer.” The Mediterranean Port of Haifa in Israel was open and operational Monday, according to media reports.<h3>Marine insurance to soar </h3>The escalation of hostilities in the region is expected to push maritime risk insurance through the roof, according to Dylan Mortimer from UK-based insurance risk adviser Marsh. “It is very early to tell at this point, but we would estimate that near-term rate increases for marine hull insurance in the Gulf could range from 25% to 50%, barring any direct attack on merchant shipping, which could have major repercussions across war insurance rates,” Mortimer said in a statement. “The primary risks center on the Persian/Arabian Gulf, particularly the threat of vessel boarding and seizure by Iranian forces and the potential closure of the Strait of Hormuz,” he added. Bimco has also warned that insurance rates are expected to increase “manyfold,” and Larsen said ships with business connections to the US or Israel would likely have their insurance withdrawn. While Iran will be able to disrupt commercial shipping in the Persian Gulf, Larsen did not expect that disruption to be long term. “It is assessed that within a few days US air and naval superiority will eventually establish a level of security which will enable commercial shipping to resume transportation in and out of the Persian Gulf and adjacent waters,” he said. Contact Greg Knowler at <a href="https://www.joc.com/article/rotterdam-congestion-limits-benefit-of-second-half-surge-in-imports-6176418">greg.knowler@spglobal.com</a>.</div>

Commercial shipping and airlines continued to avoid the Middle East Sunday as the US and Israel launched a second day of massive military strikes on Iran. The bombardment, meanwhile, prompted Tehran-backed Houthi militants in Yemen to threaten retaliation by saying they may resume attacks on commercial shipping in the Red Sea. Airlines have suspended passenger and freighter flights across the Middle East and the US has established a maritime warning zone in the Persian Gulf, Gulf of Oman, North Arabian Sea and the Strait of Hormuz, effectively placing the region out of bounds to shipping. “The establishment of the warning zone is intended to provide notice that dangerous military operations are taking place from within these locations and the US Navy cannot guarantee the safety of neutral or merchant shipping,” Jakob Larsen, chief safety and security officer at BIMCO, said in a statement Saturday. Two Houthi officials speaking on the condition of anonymity on Saturday told the Associated Press that attacks on commercial shipping in the Bab-el-Madeb Strait could restart as early as “tonight.” Houthi leadership has yet to make an official statement. A fire broke out at the Port of Jebel Ali in Dubai Sunday when debris fell to the ground after a drone launched from Iran was intercepted, according to media reports. No information on damage to the port was immediately available. CMA CGM on Sunday implemented an “emergency conflict surcharge” for the region of $2,000 per TEU, $3,000 per FEU, and $4,000 for refrigerated containers and special equipment. “In continued efforts to ensure the safety of our crew, vessels, and your cargo amid the ongoing developments in Iran and across the Arabian Peninsula, precautionary measures have been taken to safeguard operations in the affected areas,” the carrier said in customer advisory. “We understand these measures may impact your logistics and supply chain operations; however, they are necessary steps that also lead to additional operational costs.” That came a day after CMA CGM ordered 14 vessels inside the Persian Gulf and seven en route to the Gulf to immediately proceed to shelter. The carrier has also suspended all passages through the Red Sea and is rerouting ships around southern Africa. “This decision is dictated by safety considerations and is made in compliance with our Bill of Lading terms and conditions,” CMA CGM said in a statement Saturday. “Customers will be contacted as soon as we have more details of the possible alternative ports where their cargo could be discharged.” Maersk on Sunday said it was rerouting all sailings of its ME11 Middle East-India-Mediterranean service and MECL Middle East-India-US East Coast service back around southern Africa until further notice. That is an escalation from Friday , when the carrier announced select sailings of both services would avoid the Red Sea and Suez through the first half of March. “Once the situation stabilizes and the security situation again permits, we will continue to prioritize the trans-Suez route for ME11 and MECL services as it is the fastest, most sustainable and most efficient way for us to serve our customers,” Maersk said in a statement Sunday. The Houthis have not launched any attacks on shipping since the Gaza ceasefire between Israel and Hamas was announced last October. And while the Houthis’ top leader, Abdul-Malik Badr al-Din al-Houthi, voiced support over the weekend for Iran, he held back on pledging military action, Hisisham al-Omeisy, a geopolitical expert on Yemen, told the Journal of Commerce. Seeing the scale and severity of US and Israel attacks on Iran, the Houthis appear to be calculating their next move, he said. The Houthis understand “going full in at this point will prove to be costly if not suicidal, and may instead resort to measures to save face; the movement has called for public protests in areas under their control in Yemen,” al-Omeisy said. “Nevertheless, Houthis are now under immense pressure to act, and their leadership may still authorize limited strikes on ships or even Tel Aviv." Major container lines have mostly avoided the Red Sea/Suez route since late 2023 when Houthi militants began their attacks on commercial shipping to protest Israel’s move into Gaza, forcing lengthy diversions around southern Africa. Peter Sand, chief analyst for rate benchmarking platform Xeneta, said the military action launched by the US and Israel and Iran’s retaliation will “shatter hopes of a large-scale return of container shipping to the Red Sea” this year. “If Houthi militia resume attacks, as now seems likely, carriers will reverse the decision to return services to the Red Sea and prioritize the safety of crew, ship and cargo,” Sand said in a statement Saturday. “Any plans for a phased return of container shipping to the Red Sea in 2026 will be shelved until the security situation becomes clearer.” The Mediterranean Port of Haifa in Israel was open and operational Monday, according to media reports. Marine insurance to soar The escalation of hostilities in the region is expected to push maritime risk insurance through the roof, according to Dylan Mortimer from UK-based insurance risk adviser Marsh. “It is very early to tell at this point, but we would estimate that near-term rate increases for marine hull insurance in the Gulf could range from 25% to 50%, barring any direct attack on merchant shipping, which could have major repercussions across war insurance rates,” Mortimer said in a statement. “The primary risks center on the Persian/Arabian Gulf, particularly the threat of vessel boarding and seizure by Iranian forces and the potential closure of the Strait of Hormuz,” he added. Bimco has also warned that insurance rates are expected to increase “manyfold,” and Larsen said ships with business connections to the US or Israel would likely have their insurance withdrawn. While Iran will be able to disrupt commercial shipping in the Persian Gulf, Larsen did not expect that disruption to be long term. “It is assessed that within a few days US air and naval superiority will eventually establish a level of security which will enable commercial shipping to resume transportation in and out of the Persian Gulf and adjacent waters,” he said. Contact Greg Knowler at greg.knowler@spglobal.com .

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