- Industrial production dropped 15.2% in April, year over year, but that should be "the worst of the worst," according to Chris Pickett, Coyote Logistics chief strategy officer, who hosted a webinar on the UPS subsidiary's findings about Q1 and some data for April and May.
- A "small recovery" will begin with an inflationary spot market returning in Q1 2021, he said, driven by a downturn in capacity, as shipper demand recovers, exacerbating the difference between spot and contract pricing. Q1 linehaul numbers ended up 5.8% for spot TL, while contract TL ended at minus 6.3%, according to Coyote's latest analysis.
- Truck-related operations are improving, according to Morgan Stanley. In a research memo released on Thursday, Morgan Stanley said it found 47% of carriers are having difficulty running smooth operations due to COVID-19. This was an improvement from 60% two weeks ago. And it was the first time the survey of 400 carriers, shippers and brokers dropped below 50% since the firm began asking the question in mid-April, Morgan Stanley analysts wrote.
Fewer carriers, shippers and brokers are having problems operating. But during the webinar, participants discussed returning to fully normal operations, and identified problems, from adequate personal protective equipment (PPE) to making sure suppliers can deliver.
Some businesses handled the plunge in economic activity by closing temporarily. Recovery is a different story, as firms are having trouble bouncing back to normal work levels, according to Mike Sinkovitz, Coyote's VP of CTM operations.
"It varies by product line and geography, but nearly all shippers are experiencing some form of disruption caused by COVID-19," said Sinkovitz. "Manufacturers have struggled to get access to PPE and cleaning supplies. There's been a lack of clarity around government regulation that has created confusion and some spinning of tires to try to get that plan to come back to work operable."
If there is confusion about health regulations, Sinkovitz said "to go local."
"Talk to your chamber of commerce, talk to local law enforcement, get an idea of what you're going to be allowed to do to execute in the coming months," said Sinkovitz. And businesses should contact strategic partners, to know what they are capable of producing or delivering as the economy recovers.
Carriers have evolved their operations, with drivers being flexible, said J-Ann Tio, SVP of Coyote business operations. Dwell times have always been a challenge, Tio said, but more so during the COVID-19 crisis. A long dwell time could mean a carrier misses a load for the next day. But a recent analysis from FourKites found that, even as volume and truck movement have begun to rise, dwell times have decreased in nearly every state. In major markets, they are down 10% to 20% compared to the last two weeks' average.