Stay up to date with the latest transportation news by receiving TTNews directly in your email. ]
Derek Leathers, CEO of Werner Enterprises, said that patterns emerging in the freight marketplace could indicate a long-awaited change that could help trucking overcome its persistent freight slump.
Leathers stated that “Inventory levels are now more normalized” during a presentation on June 11 at the Wells Fargo 2024 Industrials Conference held in Chicago. “As consumers and retailers sell through their goods, they are back in a replenishment phase that we haven’t seen for a couple years. This can be a very important factor as we prepare for the fall and peak seasons.
The trucking industry is in a downcycle that has lasted for almost two years. Capacity far exceeds freight demand. Leathers said that while consumer demand has remained relatively stable during this period, there is no sign of a spending surge. Leathers said that they are not relying on any significant change in consumer behavior or assuming the consumer will suddenly go silent.
He said that it took retailers some time before they were able to reset their inventory in light of the erratic demand patterns that characterized the post-COVID economic environment.
Corey Cox, of the Tandet Group, discusses how early AI users are beginning to reap the benefits of the latest wave. Tune in above or by going to RoadSigns.ttnews.com.
Leathers said that “no matter how good a retailer they were, everyone’s inventories went out of control after COVID.” “But the really great retailers have returned to normalized levels. They feel they are where they should be — they have no bloat. Now they are back to normal replenishment. As they sell out, they replenish and prepare for what could be a more normalized autumn. “Those are all encouraging signals.”
Leathers said that the bid season this year was an improvement on a cycle in 2023, which saw a lot of churn among carriers as they tried to maintain pricing.
Leathers said that this year’s approach has been more stable. “There is still some pressure in the price, and some pressure throughout the process, but there’s much less churn.” This is an indication that everyone — both sides — are realizing that we’re getting closer to an inflection. It’s not the best time to change your carrier provider.
He added that Werner will remain steady.
Leathers said, “From a rate standpoint, we’re going be disciplined.” “We’ve made that public.” I don’t believe the industry has anything more to offer. “Whether the industry chooses it or not, we do not, and we are not.”
Werner is ranked No. 17 on the Transport Topics Top 100 list of the largest for-hire carriers in North America and No. Transport Topics Top 100 List of the Largest For-Hire Carriers in North America ranked Werner No. TT’s Top 100 largest logistics companies.