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Tag Archives: Transportation

More Airlines Collapse: Jet Airways India, Alitalia, WOW Air

And the 217 planes that Jet Airways has ordered from Boeing? By MC01, a frequent commenter, for WOLF STREET: Today, another major airline collapsed. Jet Airways, India’s largest private airline, announced “with immediate effect” that it was “compelled to cancel all its international and domestic flights.” It suspended operations on a “temporary” basis. It said: “Since no emergency funding from the lenders or any other source is forthcoming, the airline will not be able to pay for fuel...

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What J.B. Hunt Just Said About the U-Turn in Trucking

Largest US Trucking Company: “Volume, or lack thereof, is obviously the main story.” The inventory pile-up hurts. And the driver shortage is ending. J.B. Hunt, the largest trucking company in the US by revenues, and a barometer of the goods-based sector of the economy, reported late Monday that revenues rose 7.3% on higher freight rates and fuel surcharges, that net profit inched up only 1.2% despite those price increases, and that Intermodal revenues ticked up 2% while Intermodal...

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Next Phase in Trucking Boom-Bust Cycle Has Started

From “capacity panic” to “overcapacity” in less than a year? This is one of the most cyclical industries, with legendary boom-and-bust cycles: Orders for Class-8 trucks plunged 67% in March compared to March last year, to 15,200 orders, the lowest March for orders since 2010, according to FTR Transportation Intelligence. These are the heavy trucks that haul consumer goods, equipment, commodities, and supplies across the US. This plunge comes after orders had already plunged 58%...

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Worsening Inventory Pileup Rattles Goods-Based Economy

And how it compares to what happened during the Financial Crisis. The goods-based segment of the economy is heading for rough waters, and it is further diverging from the path of the services-based segment of the economy that is still growing at a solid rate: that’s what the current inventory pileup tells us. When inventories pile up, sales by those companies that supply that inventory do well. But companies that sit on that inventory and have trouble selling it will at some point cut...

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What FedEx Just Said About Europe and China

“Asia volume weakness, which we experienced during peak season, deepened post Chinese New Year.” When FedEx, a corporate barometer for the global goods-based economy, reported earnings this evening, it missed lowered earnings and revenue expectations, and it cut its guidance for the rest of the year, below already lowered expectations, and its shares tanked 5.7% in afterhours trading. The US holiday-shipping season had been fairly decent for FedEx, largely due to the continued shift of...

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US Freight Volume Drops

The services sector better hang in there. Now it’s the third month in a row, and the red flag is getting more visible and a little harder to ignore about the goods-based economy: Freight shipment volume in the US across all modes of transportation – truck, rail, air, and barge – in February fell 2.1% from February a year ago, according to the Cass Freight Index, released today. The three months in a row of year-over-year declines are the first such declines since the transportation...

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Inventory Pileup Sounds Alarm for Goods-Based Economy

“In 30 years, I’ve never seen anything like this”: CEO of warehouse operator Pacific Mountain Logistics. Sales at merchant wholesalers (except manufacturers’ sales branches and offices) fell 1% in December 2018, compared to November, to $497.2 billion on a seasonally adjusted basis, and inched up only 1% compared to December 2017, according to the Census Bureau estimates this morning. But inventories at these wholesalers rose 1.1% from November and jumped 7.3% from December 2017, to...

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What Trucking & Freight Just Said About the Goods-Based Economy in the US

Something has to give. Starting to be a fascinating phenomenon: Rates charged by trucking companies and other transportation providers continue to surge on a year-over-year basis even as the volume of shipments has dropped below where it had been a year ago, while the “capacity squeeze” of 2018 has disappeared, and as the price of fuel is down year-over-year. Freight shipment volume across all modes of transportation – truck, rail, air, and barge – in January ticked down (-0.3%) from...

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Next Chapter in Bankruptcy & Restructuring Saga of European and Asian Airlines

The fate of the A380 is sealed. By MC01, a frequent commenter, for WOLF STREET: On February 5, German low-cost carrier Germania announced it has filed for insolvency in Berlin and that all flights will be suspended indefinitely. According to the press release, this was due to unfulfilled “short-term liquidity needs,” meaning the company was struggling to raise the cash needed to pay for obligations coming due in the short term, such as fuel bills/hedging, landing fees, maintenance...

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Phenomenal Trucking Boom Ends, Trucking Bust Starts

So that U-turn was fast, even for the legendarily cyclical trucking business. In January, orders for Class-8 trucks — the heavy trucks that haul trailers with goods of all kinds across the US — plunged by 58% from a year ago, to just 15,642 orders. It was the lowest number or orders since October 2016, toward the end of the “transportation recession” when Class-8 truck orders had plunged to the lowest levels since 2009, and truck and engine manufacturers responded with layoffs. The...

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