FreightWaves Today | September 8

0:30I'm going to break ways today. It is Monday. Tuesday. Not thank you, Julie, for reminding me. It is right after the Labor Day weekend, long weekend, felt really. I had the chance to relax and chill and not do anything, which was amazing. I labored it for the last couple of months. It was good to cut, how to get a break. How about you? We had a lot going on just with kids soccer and an event at the Foul, which is really fun. So we did a lot of fun stuff. Football is back. Football in general. High school football is back. High school football is back. Some great weekends. What happened at the Baylor game? I saw some clips where the coaches were doing all this weird signaling. I don't know. You mean the Baylor school or Baylor University? University. I don't know. I didn't see any of the signaling. I watched the whole game.

1:30I'm not sure what you were trying to do. Although the coach went, you know, basically they were down by one point. The coach went for two. They lost Auburn stopped. They were a little disappointing for Baylor fans. But it was a great game. And right after that, I came with low expectations. So the fact that we didn't get blown out by Auburn was a good thing. So we take our wins and we can get them. But back to it here in the freight market, things are, this is really the start of the retail peak season. So when things sort of kick off of the West Coast, not a lot of movement in terms of the data. Yeah, we did see, and we'll talk about a little in this at our update. We did see, sorry, it's rise last week heading into the holiday. And we did see rejections rise a bit and get above that 14 and a half. I wouldn't call it impressively there. I do have a really bad thought. That's a good man. The question is, and this is my theory is that I think some of the consumer retail CBG specifically that's food in bev is doing worse than expected.

2:35And I think some of the volume has been dropping off because food in bev and really the question there, we've talked about it extensively, is it GOP1 that has to be a factor. But also is the deportations, the immigration story where you start to change the population. They're not consuming as much. And then you also have snap benefits. Some of this is inflation related. We talked to folks that are in the beverage, particularly aluminum cans, soda, and beverage. We're aluminum prices due to tariffs that gone up through the roof. And therefore, there's less consumption. It's been inflation and price inflation related. Yeah, aluminum and steel both, right? I mean significantly higher prices and I guess a shortage. I'm always scared to use that word. But short term lack of available steel and aluminum. Yeah. And I think the question also, and we're going to get into this with John Kingston, is how much is energy prices due to all of the geopolitical issues impacting consumer prices and then consumer inflation.

3:37Because that may be slowing down some consumption. So all of this is, we're going to get into this all today. But let's get into the headlines. Things off with a devastating cargo jet accident that has shut down half of Miami International Airport's operations. An Amazon Air Cargo plane operated by North Carolina based 21 air. Overran a runway during landing Sunday afternoon. Struck multiple vehicles on a nearby road and caught fire, leaving five people dead and five seriously injured. The Boeing 767-300 freighter was arriving from San Juan, Puerto Rico, when it left the runway traveling at 130 miles per hour. Two of Miami's four runways remain closed Monday morning, causing flight operations to be impacted throughout the day. The National Transportation Safety Board has dispatched a team of experts to investigate the runway excursion, while the cause remains under investigation. Over on the rails, more than 100 House Democrats are demanding that railroad workers come first in the proposed Union Pacific Norfolk, Southern Megamurder Review.

4:38In a rare showing of party unity just weeks before crucial midterm elections, 102 members led by representative Valerie Hoyle sent a letter Thursday to the Surface Transportation Board, demanding the $85 billion transaction be evaluated first and foremost for its impact on railroad jobs, safety and accountability. The deal, first announced in July 2025, would create the first transcontinental freight railroad and the largest rail network in the country's history. Mark Wallace, National President of the Brotherhood of Locomotive Engineers and Training Men, says Union Pacific's offer of lifetime employment for Union members does not fully protect some positions. The board has said a November 18 deadline for comments, protests and requests for conditions. Finally, a visa enforcement dispute is threatening to disrupt cross-border freight flows between Mexico and the United States. Trucking industry leaders in Mexico are intensifying calls for US officials to clarify how B1 visa rules are being enforced against cross-border truck drivers. After Mexican drivers began losing their visas, following encounters with US officials involving alleged cabitage violations.

5:44The dispute spilled into public view Thursday when truck drivers blocked commercial traffic at the Mexico City, Mexico, and Mexico, Mexico, East Border Crossing and Protest of visa revocations. Mexico's national chamber of freight transportation estimates more than 25,000 visas have been revoked from commercial drivers along Mexico's northern border, including potentially 4,000 in the Tijuana area alone. Industry leaders warned that continued uncertainty could disrupt time-sensitive shipments, including medical products, technology, food and perishables moving from Mexico into the United States. Julie, it's interesting we're a couple of months into the post Montgomery world. I actually think this is a Goldilocks, I've said this before, Goldilocks is an environment for freight brokers, let me explain why. There's been a lot of attention on freight brokerage over the last couple of months in terms of increased cost, took a larger broker that can absorb some of these increased insurance costs.

6:47But in terms of market conditions, it's actually an ideal market. Spot rates are not accelerating, they're calm, but contract rates are going up. Fuel surchargers are going way out, and therefore from a perspective of a broker, that's a good environment. Especially if they're getting contract freight from shippers with a fuel surcharge, and then they're selling it on the spot market. Exactly. I think it actually is good for freight brokers because we haven't seen the massive price inflation in spot markets and spot markets have cooled off. You can see that in the NTI data is just how much it's cooled off. For motor carriers having to pay record high fuel prices, majority of motor carriers are buying their fuel on wholesale rack prices or cost plus arrangements, not on retail prices. Those still are record highs. It's something that motor carriers are having to eat, but they do if they get fuel surcharge as they get the benefit of it.

7:49I've been dying to ask you about your thoughts on the first story about the card. Project situation. Yeah. And so, you know, over ran the runway, couldn't stop. Unfortunately hit a van with people in it leading to face fatalities and then ran into. I have. As a pilot and I know none of us know what's what happened in TSP is. Investing it, but do you have any. There's a lot of sensitivities when there is an aircraft because you get people who immediately diagnose it and then pilots get it really offended by that because oftentimes you don't know. What actually happened. I think the facts are that the airplane, if you look at the data, you look at the tape, if you will, the video recordings that were there is the plane landed much further down the runway than what, you know, a couple thousand feet than what you would normally expect to happen or would abnormally happen. We don't know. We don't know what happened. I mean, the fact is that the majority of accidents are pilot error of some sort.

8:54But we don't know. And it's hard to, I think it's hard and probably improper to speculate because, you know, a couple people lost their lives. These are anytime you're dealing with large commercial aircraft. These are highly trained pilots, the best, the best. And it's unfortunate that this is happening or has happened. But we don't have a lot of information. I mean, this is just something that I think we're all going to, you know, hear from the NTSB they'll put at a preliminary report a couple of weeks. You know, we'll get some indication in terms of their initial investigation. And then the official report takes actually one to two years before you finally see the official report. And I think in a couple of weeks when they put out that initial review, we'll have a lot more information that happened. Was it a mechanical failure? You know, they didn't the pilots reportedly did not offer may day. They did not have any communications with ATC that said it was a mechanical issue. But, you know, mechanical issues can happen, especially if you're in, if you're in the cockpit and something happens with a quickly, especially on landing, which is the most dangerous part of a flight.

10:01In terms of fatalities, your, your head, you know, focus on trying to land the aircraft safely. So the question is what happened between the last air traffic communication and the time where they touch down. Unfortunately, incident for sure, I think one of the, there's nothing great about this, but I think one of the, the great things is that this wasn't a passenger aircraft because it could have, could have been much more dead and much more significant. And look, we don't want to see cargo aircraft, you know, these pilots are in many ways the best air pilots that you have flying cargo, largely because they pay better. And so these are kind of really coveted jobs flying air cargo. And so you get highly seasoned pilots. A lot of times, pilots will go for flying very structured routes like you, you would be doing the same routes regularly or no. The look, it's variable, particularly with some of the like Atlas air and, you know, that you get actually a bit more variable on cases because you're flying, but on Amazon's network, I imagine it's more scheduled than that.

11:08But the thing about air cargo is that those jobs tend to pay better. And they tend to have more seniority because they're such highly desired jobs. Flying for the airlines is brutal because the passengers talk, the cargo talks, these are humans. Whereas in the cargo planes, the boxes aren't talking. Yeah, you don't get yelled at if you're by a box, right? Because that's the advantage. And so, so those jobs are usually highly trained pilots. No, it's not going out with those turbulence. What's that? No one's throwing out the turbulence. Yeah, nobody knows if you had a rough landing as a cargo pilot because there's nobody there to talk about it. I have any thoughts on the NSUP. What I think is interesting is saying the guarantee of lifetime employment for union members still doesn't fully protect some of the members. I think the unions know they have an enormous amount of leverage. Yeah. And I think they're going to insist on getting their quote unquote pound of flesh as much as they can. It's an amazing opportunity. I think the issue for the unions is as you have tighter concentration of employment and fewer and fewer places, it just mitigates some of their leverage.

12:21But they're going to take as much opportunity rightfully so to get as many concessions as they can. So I think we'll continue to hear up until the decision that they want more. And I don't think we'll hear them say this is great. I think we'll hear more demands come out of the union members. I would do that if I were in a union. I would give my peace to quote our friend, the longshoreman. Do you remember that video? We got to get him on the air. He's the dude. No one was like so against automation. Yes, the East Coast Union guy, this video of last year, two years ago, I want my peace. He talks about studying an economy if he didn't get his way. Amazing. Why not essential casting as a union mafia? Ask a member. Love him. Quite, you know, he's got to get his peace. So let's talk about something else. Let's talk about another major set of stories. This is the oil. We have so much to talk with John Kingston. He is a book of Encyclopedia of information, but there's two big stories that are going on right now.

13:23What is the energy conversation, which we'll get into that in a second, but let's talk about the Leapah versus Lupa Superior, probably the most outside of the Montgomery case. This is probably the most infamous case in trucking. If the one where C.H. Robinson was hit with a massive nuclear lawsuit, the largest nuclear lawsuit in trucking history of an operating company. And the person that's reporting that is John Kingston. John, how are you? Good. Not bad, yourself. So let's talk about what's the latest update on this Leapah versus Lupa Superior case. Well, there's not a lot. And that actually is news as you remember when the 600, I guess the $604 million verdict came down, it had to be affirmed by a judge. So I've been checking the docket, which isn't the easiest thing to get into Dallas County, but anyway, I managed to finally. And the only thing that really has happened is that the plaintiffs made their kind of formal request in a brief last week to have the judgment affirmed.

14:26There's still no action on it. I mean, it's been probably what, six, at least six weeks. So there's nothing new, but that's important because I think everybody thought the $600 million was, would go right to appeal. You have to first have to wait to see if the judge knocks it down at all. So we're on top of it. I was in touch with C.H. Robinson. If they know anything, they certainly haven't said anything. Just coincidentally today, CityCorp had a tech conference and they invited C.H. Robinson to appear on it. He Boson was there, others, and their reason was, the reason we're doing this was that C.H. Robinson is a great tech story with their adoption of AI and what it's done in terms of all sorts of productivity measurements, revenue per employee, profit per employee, etc. As we know, they've cut six, 7,000 bodies in the last two and a half years. He didn't mention anything about that. He may have mentioned the judge needs to rule on this in passing.

15:29He Boson said some of the same things he said in the quarterly conference call, which would have been in late July. We think that we are better suited to deal with the kind of post-Mogummary and post-Lipa environment because what he said, he says we've got tens, our court cases against us for negligence, etc., negligence and liability are measured in the tens and we hand in millions of packages every day, millions of shipments every day, millions of shipments over X number of years. They seem fairly confident that they're in a better position to handle the new world and that's quite frankly, that's the case. As we think we all know that when you get tighter government regulation, this is in government, this would be a tighter regulatory atmosphere, really coming from the insurance industry, the bigger the player, the better you are or have to handle it, the smaller you're the ones that fall by the wayside and get consolidated.

16:31So anyway, so as far as Lippa, we are still waiting for the judge's affirmation. I don't know that there's a deadline and you know, it could drop in the next 30 minutes, it could drop in about a two weeks, we don't know. But that's what everybody is waiting. I think what I've read is within the next 90 days is when the judge should have firm, I think City Act should put that up this morning, within the next 90 days we would get either an affirmation or the judge would decline to certify the plaintiffs. I think the plaintiffs award and I guess would send it back to the jury, is that how that works, whether it's a, hey, this is an I just or I don't know whether it goes right to go right to appeal, but even if it's even if it's cut down by the judge, it's still going to be massive, it's still going to be appealed. One thing Bozeman said, I don't know if it was Bozeman or what's the CFO's first name, the last name is Lee Damon Lee, okay. He said, you know, most of their settlements that they do when they get sued are in the range of a million to three million.

17:34I don't know what the path is to go from a 600 million all over it down to one to three million. It was seem to me that's a little tougher than most. So my guess is I don't even know the judge, I shouldn't be talking about her. It is a female and my guess is she's probably pretty aware that the whole industry is hanging on her actions here. Yeah, pretty amazing story as we've covered and certainly has. I think that shock way to the freight brokerage industry, I've touched a lot of executives of large brokers, they still contend there in a much better shape in terms of fighting these lawsuits. John, as you've talked about, then there's smaller competitors, they just feel like they have more big a balance sheet, have better insurance, they would argue about better processes and policies in terms of this that can be debated, but they feel like they're in a better position versus some of their mid market and smart competitors. Yeah, you know, also, you know, we talked, I think when this came down, I was on your show and we talked about how the bigger verdicts, verdicts are larger than this, where against these kind of phantom ghost companies that in some case, they didn't even show up a trial.

18:44I mean, this is against a significant player, and the one that comes to mind here is Wabash, Wabash had like $450 million, verdict against it in St. Louis, and they eventually settled that for, I mean, I think it was still three figures, but they did get it out of the way. So I think that one of the reasons that there's so much interest in that is because of the defendant, because the defendant is not a ghost here, very much not a ghost. The company that actually clearly got a bigger impact. I mean, look, I'm sure C. Trobbins's investors and shareholders would not like it to write a six-centre-men-dark check if that's what it comes down to. By the way, which is be clear, C. Trobbins didn't was only, I think, 23% responsible, which is they have 135-meter insurance. If you do the math, I did it. Comes out suspiciously at the same amount of money as their insurance level, or their insurance cap, which means perhaps the jury deliberated about the amount in the room and decided, you know, I have taught to people that are, but may or with the way Jury's think, and they say, like, Jury's just don't have a lot of sympathy for insurance companies.

19:48And they wanted their pound of flesh for the insurance companies, what it appears to be the problem, as John, as you know, is that in states that have partial liability, is if the other two co-defendants, in this case, there was the driver who's now passed, Lupus, which is a company that has something like 200 trucks, and unlikely ever to be able to write a six-centre-men-dark check or have the insurance there to cover that. It's likely that St. Robinson could be on the predominance of the entire hell. That's the big challenge when you get these partial liability issues. Right, exactly. Yeah. John, is it typical for a judge to take this long to affirm a verdict like this, or is this lasting longer than usual, and do we have any idea why? I don't know. I get a little sense that maybe it's a little longer than usual, but because of the size, but I really do not know. It's an interesting question, I think. John, we should track that down if you get the chance to talk to some attorneys that are involved in these big allegations. I would actually be curious if this does feel like a long time.

20:51I mean, I'm not an attorney nor would I pretend to play one on TV, but it does strike me that it feels like a long time to affirm a judgment. And maybe the issue is the reason it's taking long is because there's so much interest in case law here. We talked about it on the air. You were on the air the day that this happened where we had the one of the attorneys that was involved in the case was texting me as we were on the air. And what they were telling me was that the reason that this judgment was that the driver was a borrowed employee and what they made the case was because they had the CD Robinson app, the employee that's now passed, the driver had the app, was how they determined he was a borrowed employee. And the reason that the plaintiff's attorneys went after that was they expected it to all the other parts of the case to get thrown out on appeal, this liability question that comes into effect that they expected that like the Home Depot case to be thrown out on appeal at the Supreme Court.

21:55So they wanted another angle to get the case potentially to hold up. Right. And the similar case as far as what the driver and who they work for is going on in the Penske case, because in that case, Penske logistics, which is the trucking company, which is a carrier, had broken out the freight to another carrier. And then there was the accident, the fatal accident, and it being viewed as really significant that the court said that Penske logistics is liable here because, you know, according to attorneys, the traditional, not the traditional, but the historic precedent in this kind of cases, once you've given the freight to somebody else with their own with their own authority, then you are not going to be liable. So they're viewing that one as extremely significant to so this is going to be a great time for trucking attorneys to get more work than they know what to do. A lot of cases that could really have a long term fundamental impact on the business.

22:59Well, the other case reminds me of the double brokering case. You had two cases that you've talked about where the freight was double brokered one involved J.B. Hunt. It was another one that involved a carrier called a one I've never heard of. I believe it was the a one case that is that they were the broker of record they they broker to a carrier. So they thought that care them double brokered it and then it gets triple brokered to a to a carrier that wasn't even operating didn't have an active operating authority. Tell us a little bit of that he was the broker didn't have broke it. Yeah, and then it's don't break it. It's funny you bring that up now because I spent a good chunk of several hours this morning putting together a spreadsheet of what I realized was this massive mountain of cases I need to follow. I could not keep doing it up here. I had to put it down somewhere. So I will tell you that the a one case I hadn't really gotten to the go back and review what had happened there. I would say that the most I can just say about the the Penske case. I can't remember now, but I think it just just how significant that one is being viewed as and yes, the J.B. Hunt one is the other one.

24:04So if you take the J.B. Hunt issue plus Penske plus C.A. Robinson where they were founded to essentially employ the driver you have got a whole lot of litigation out there and PISC is arguing the same thing is that he was a bar employees you know. That's that's all in the mix of these various cases. Yes. So who works for who is all very important here. And look, there's a lot of repercussions if somehow which you know talking to people who are familiar with the legal system would argue legal analyst argue that cases likely to get at least the the fact that he was an employee is likely to get thrown out on a pill. If somehow it does hold John this could just up the entire brokerage model because then it brings into a lot of other questions which is. Are you responsible for you know employment taxes are responsible for benefits are you sponsor for overtime is a lot of other questions that remain to be answered that we've seen and look it looks like. There's so much happening right now in the court system that as we have these cases that sort of open up new case law or new judgments you're you're you know as you covered the court system is a lot of times precedent is legal precedent and judgments that determine whether or not a case will stand and whether an argument can be made and so this is.

25:21In many ways the legal system is a as an evolutionary sort of living system that is constantly being updated. Let's say about the Penske case a lawyer who contacted me and I have a good relationship with but this was not a particularly pleasant phone call because he felt that the first story we wrote had not truly grasped how significant it was that Penske's motor carry authority that the motor carry authority of the company that it had broker to which I guess is little bit more. The Liberty Lane is the Liberty Lane right that that still Penske was still found liable in that accident and he his view is that freight waves had not fully represented how significant this could be how big a precedent this could be if it stands if it stood so the further reporting has certainly reflected that but I think that's probably the one that maybe needs to be washed the most but again you know as we're going through all these cases so as the C.A. Dromansome one I know that I think the money in the C.A. Dromans in case is probably less important to them than the fact that they were viewed to be the employer of the driver because that's the kind of thing that just keeps going and going and going and for the litigation the money of the pain it's done.

26:34It opens up a lot of things a lot of issues I mean and both the TCA and a TA the truck of care association and the American. Hey, Matt about the Penske case and said this is a precedent that if it were to proceed if it was to hold up and and the judgment was against the against Penske it would have a profound impact not only on the trucking industry but the overall economy. Yes that's true and they said they join again. Yeah let's talk about energy your favorite subject it is Tuesday it's the day that the E.I.A. puts out the Department of Energy. Index no it's holiday. Okay I'm trying to keep track of the days Julie this Tuesday that feels like Monday is really I know it's a really important thing it's kind of important we had a day off but we're back it's Tuesday. John what are we what's going on in the oil markets obviously diesel hit highest prices ever both that's also for rack prices as well as retail tell us a little bit

27:36what state of diesel is. Right so diesel hit the highest price ever as far as the futures market there's one total outlier as this is like as of last Thursday there's one total outlier out there from earlier this year that was on the day before the contract roll over the price shout out the five bucks if you throw that out we hit a new high last week as well on the futures market. It then actually fell back fairly sharply on Thursday and Friday I mean the great irony was there's all this media coverage of the highest price diesel ever and diesel that for two days there took a pretty nice fall. When trading kicked off Sunday night there was no settlement yesterday when training kicked off last night Sunday night in the futures market it started to rise again enough to wipe out all of the declines of Thursday and Friday but the last time I look which is about an hour ago it actually kind of given up a lot of those but I don't think anybody thinks that this is over you you know I mean I spent this morning looking at conflicting reports about what is the amount of oil getting out of the

28:40hormones it certainly seems to be probably above 10 million barrels a day remember it was about 20 million barrels a day before the war you ramped up some of the non Persian Gulf export routes the pipelines that were mostly lying dormant as a result of the fact that most of the stuff needed to go east to China and other areas in Asia so that that has been ramped up I did see one map where the Saudis exported oil to ship that out of their Yanbu pipeline which is on the Red Sea and ship that down through an around Africa to get the China this kind of inefficiency adds up but you know diesel is yes it's at it's at a no all time high at the pump which is what matters I really wonder you know you we we we were talking before most these companies said when I trucking companies were at report their empty miles they'll report like 11 to 12 percent of the miles right that I've seen Craig I'd be interested to see what you have to say about that that's not dedicated that will be over the road I mean it's

29:42over 11 to 12 percent of their total miles that don't have a field surcharge attacks to attach to it so yes do I mean fear they do tend to I mean the larger cares are absorbing some of those deadhead miles and look it's not the big bears that are at 10 to 12 that's a by the way that's a very efficient operation network at 10 to 12 if the owner operators and the folks that are in the 18 to 20 percent you know that's one of the reasons that when you look at like Pam PTSD or I don't know if that's still the ticker but yeah no panicked to the patient and Pam T I think they've changed their ticker I'm I'm stuck in the old ways but they have higher deadhead because of the way that their network works around that auto fray and that's one of the reasons that their operate ratios you know well above 100 percent was because the sick how to give the auto business John you know we talked last time that you know you talked about her moves I am curious though there's been this reports on at least on X about dredging the US military dredged a canal is that true or is that just

30:45nonsense I don't I mean you can't really just dredge a canal you that's a take to get out to another canal right you see those post by the way I'm no I don't think I have maybe I have it I don't remember but you know there's one that's been talked about be a canal through or mom but you know look how long to take to build a Panama canal how long to take to build a well canal so you know I can I can see where that's where that's you know possible what was the capital for that kind of come from well and said that you was military was the was the X post again I you have to sort of take it with a grain of salt somebody was like photos I just wonder if you're going to do that would you be better just like kind of putting another pipeline that runs parallel to the system that go out to the red sea yeah I don't know um john you tongue last time that really your concern was not or moves to the degree it was Russia tell us a little bit about your thoughts there well the concern really when I say

31:51Russia is refining it is September and you're going to start to see some maintenance go down made me the fall is the maintenance season has is the spring maintenance is the kind of thing that gets booked well in advance it involves oftentimes hundreds of workers coming on site from somewhere else these are not like the local employees of the refinery these are contractors who come and I mean I remember one time going to North Dakota and staying at a hotel that was filled with people who were there to to do maintenance at a really small refinery uh and it was you know just hundreds of people so you can see I know that I heard that Lama Ohio which I think it's still a B.P. refinery is going down for a significant maintenance the companies would rather not do maintenance right now they're making so much money every time they put crew through their refinery uh I know that anytime you've got high prices and you start hearing about maintenance as this conspiratorial or you know right there's maintenance they do not want to shut down his refineries now spending straw into gold but if you don't take care of your refineries you're going to have bigger problems down the line so as we know you actually

32:57find a reason I've been operating at around 97 98 percent of capacity you can't do that all the time and some of these are going to have to go through their maintenance and I don't know what refining capacity is out there to fill the slack again yes given the loss of refining capacity in Russia which is heavily diesel oriented and is going to be more than a million barrels a day you have lost lost refining capacity easily it's it's probably more I guess I've seen like 1314 John do we think that the administration is going to do anything around exports do we think there's any an export man potentially coming as we get or are no no that's not happening I don't know I mean it's such a cheap populist trick I could see it I just hope the cooler heads with the veil the fact is that since exports were allowed remember some exports of products were always allowed there was never a ban on those the ban on exports refought referred to crude and that was that ended in 2015 2016 and it's actually been a godsend for the US industry because they were able to take the light sweet

34:01crude that they increasingly produced like in the Permian Basin and up in North Dakota and export it away from the US refineries that are really not built to handle them so I don't know if you would have an export ban that would hit crude and products if you if you had an export ban on products it would not just be reversing a policy from 10 or 11 years ago it would be reversing a policy forever my recollection is that when the crude oil export ban was lifted in 2000 and it was in 2015 there were three things in the US that you couldn't export refought crude was one the second was some kind of horse and the third one I don't even remember I mean I just just just shows you this you know where an export ban how radical it is compared to traditional US economic policy but could I see it yeah I just hope that it doesn't happen because the best way to fix the best way to fix a I'm called a broken market but a market with the significant imbalances is just let the market work and if you have any for ban that's not going to happen

35:08best cure for high prices is high prices is they like to say in commodity markets John you know it does I think the paddle farmers the beef farmers would argue that some of the administration is a recent you know basically lower in the terrorists and providing incentives to bring in sheep or beef is counter to their interests so who knows I mean administration is known to do things with tariffs we saw bombardier out of Canada get a ban according to Donald Trump it's a Canadian aircraft manufacturer which has a lot of production of both supply parts and actual builds aircraft in the United States this is something that who knows and yeah so how do you like to be how do you like to be Roger Marshall this morning you come and Republican senator from Kansas apparently in the fight of his life you know what was always thought to be a deep red state and he's got to defend these attacks on on what's a bombardier is that hyperness I was browning here so French name and Canadian like like 2500 bombardier employees in Kansas well he's got to defend his Kansas I mean which is Taz the home of text drive which is Cessna so

36:18there'll be still a more citations out of it so who knows John we'll we'll get back to you again next week I know you'll have great stories on the site well next Tuesday I'll see you out of our event to JFK that's true we will be at the TWA hotel I'm super pumped about that is a big aviation I wanted to go there forever I've gone past it a zillion times I'm finally going to enter it well I'm looking forward to it you know it's the retrofit of the TDA a terminal that is at JFK so I'm really excited to be up there it's near John's home we'll be right back into these messages and we'll talk about Sonar and what's going on the market blind spots cost some of fleets costliest collisions samsara's AI gives you 360 degree visibility into risks on the road so you can protect your drivers in real time learn more at samsara.com what's the masterclass all about well here's what I'm going to tell you if you are a driver you're an owner operator you're a fleet owner whether you're in compliance services dispatch and no matter what it is masterclass for you

37:25every two weeks you're going to sit down with me and we're going to go over certain business topics that are related specifically to your small trucking company operations we're going to help you with everything from compliance to how to negotiate better on a spot board how to find direct freight and everything in between this is the reason why you don't want to miss out on masterclass it's about an hour to an hour and a half and then on top of that you'll have the library to use for that way you can always research and reflect back on to it don't miss out this opportunity this is built specifically for you I'm excited and I hope to see you in class the world doesn't wait so neither do they wheels on the interstate boots on the sites hands on the ship we build for the world out here and we build it with the people who live it ideas from the field made real by world class R&D to keep the operation sharp the front lines safe

38:37and the world moving from one cab to a global network billions of miles trillions of data points everyone making your operation better and we never build it alone Sam Zara built with operators once a year the entire freight industry stops what it's doing and comes to one place chattanooga Tennessee this is F3 the future of freight festival it isn't just a conference it's the largest festival in freight built to pull you all the way in the energy the ideas the atmosphere and the people who move this industry forward over 50 speakers for events across three days founders executives innovators and disruptors all under one roof all asking the same question what comes next on the main stage the sharpest minds in freight take on the biggest questions in the business

39:40the trends the technology and the forces shaping what's ahead then the clock starts seven minutes no exceptions the cutting edge of freight tech goes head to head live battling for best in show when the times up the lights go out and in between the conversations that don't happen anywhere else the connections that change the trajectory of your business the relationships you'll carry long after you leave because when the sessions end the festival begins live entertainment unforgettable experiences a celebration of the world of freight and an energy you won't find at any other event in the industry the leaders you need the access you won't get anywhere else this is where knowledge is shared where deals get done where the future of the world is going to be. The future of freight gets decided F3 future of freight festival October 27th and 28th the signal Chattanooga Tennessee we'll see you there register now at live dot freight waves dot com

40:44Today's center update Tuesday September 8th we are going to do a quick recap of what happened over the Labor Day weekend and what we are in the week leading into it and what we are expecting coming out of it. So looking back last weekend kind of taking a snapshot of today truck load rejections remain a little bit elevated so we are still at about 14% which is about a half a percent increase month over month. Spot rates are at 344 which is about almost 2% increase month over month contract rates are still elevated 272 plus fuel which is about almost 20% year over year increase and Intermodal contract rates still remain up about 7 and a half to 8% year over year. When you look back at leading in to the week of Labor Day tender rejection rates did jump up back above 14 and a half percent last week as we approach Labor Day holiday.

41:44So that's about a hundred basis point move and it's the strongest increase since 2021 that we've seen for the Labor Day holiday. Spot rates of course followed suit tender in rejections increasing they increased significantly in a majority of US markets and demand was however less impressive. Total tender volumes increased less than 2% heading into the holiday before falling back right for the weekend and then you'll see volume really fell off today or yesterday on Monday which is as expected with shippers being closed. Some of that volume demand falling can be quantified as modal shift but we're still really watching what's happening in the economy and some concerns around goods demand moving forward so speaking of that modal shift intermodal demand did remain strong last week domestic container volumes average about 20% higher year over year and international container volumes are also up more than 10% last week so imports a remaining study.

42:49Our IOTI which is the inbound ocean to you index measures bookings of containers being moved on the water and landing in US ports and it was still elevated last week averaging about 10% above spring levels so we're continuing to see that elongated peak season. That seems to be persisting into September though it is gradually beginning so we'll continue to watch you know demand there is those imports then turn into over the road freight. As we think about last week specifically both rejections and spot rates increased more significantly around Labor Day holiday last week than they did in the past four years as mentioned earlier and increased follows kind of a fairly long period of stabilization stabilization that began after the 4th of July so we've been watching that and seeing sort of a normal seasonal market through the summer most of the downward move it in spot and rejection rates during that stretch really again can be. Explained by seasonal pressures are the loss of demand to intermodal so we'll continue watching what's happening there and if there is any pick up in demand capacity should remain kind of under pressure this week as shippers return to the office and start pushing seasonal volumes and then we'll see if things more normalize out again towards the middle of the month or if we start to see demand pick up for a true peak.

44:14So I think the key here is that markets really still are not balanced while we aren't seeing an increase in demand there is still absolutely volatility in this market it's really vulnerable to disruption as we're not seeing capacity pick up right this is still a capacity driven market that we're watching so any upward pressure from demand could absolutely turn the dynamic really quickly to even more favorable for underlying care. And create even more pressure for brokers and for shippers so that happens and you are shipper and you do start to see some of this pressure we always are going to recommend reaching out to our sponsor RxO for capacity now. A little bit. A little bit talk about a little bit sluggish but it's for brokers is pretty good for brokers pretty good it does feel interesting you know I think shippers are finding capacities available more so than perhaps we expected we are headed into peak there will be some need for last minute capacity and that's really where the RxO.

45:25So that's a very good capacity now thing comes in our sponsors so you know that's I think interesting in terms of what's happening but let's talk a little bit about something happened over the past week our samsara our headlines sponsor show blew it out of the water. Tell us a little bit about what their earnings are telling us yeah so really just high level 30% year for your revenue growth in Sanford a very mature company. So we're here 27 of another 24% year year growth so continued they spoke about accelerated growth in transportation in Mexico but what I thought was also interesting is we've been a big fan of some new products as we went to there. I love the tracking label I know we're sort of obsessed with that here so that's cool and the 360 I like that. So emerging new products make up over 20% of their new bookings when they they mentioned that earnings so that that was really cool these are the products that they rolled out in it didn't say which one is that emerging in new products but or if they did I didn't I didn't hear that part right I just got a summary of it but

46:35I found some good enterprise fit and that they're really expanding with their customers through their multiple offers of products and their connection network. It strikes me that the whole ELD and just tracking is becoming far more important in a post Montgomery world because knowing that the you know can I trust the counterparty do I know that this carrier is legitimate can I trust that their legitimate is my stuff going to be safe. You know fleets that have installed this type of technology are arguably safer they're investing in their monitoring the drivers monitoring activity and ensuring compliance it strikes me that they're incredibly positioned in a post Montgomery world and they can be broke or so doing a lot more work on who their counterparties are. I mean I think the more visibility you have the more in control you feel right and what they offer goes so much further than just visibility with analysis and potential AI coaching and all the other things that that 360 camera does and speaking with the driver so it's certainly and cargo and fair position really well for.

47:38Cargo theft is a really you know it's an emerging crime it's a very fast growing crime and it's across all modes of traffic I mean you have it we've talked to the railroads you know what we talked last week with Bill Stevens talked about some of the rail theft that's taking place air freight seeing theft truck brokerage and trucking is really proliferating you know getting knowing being able to track the stuff in a way that isn't easy to identify for the criminals. The problem is with like you know in the old days if you had a satcom device on a truck the criminals were not able to disable that or bear that those things even existed we're well pass that or criminals are now very well aware of it and so you almost have to track down to the box that's where those smart tracking labels become pretty interesting opportunities to to be able to to you know show where your freight that and track it and if it does end up in the hands of the truck. So it's really interesting time but I do think the compliance question you know this was 10 days ago we had the motive for a samsara heated highway mode of highway.

48:55I'm not sure I knew exactly what you meant. Thank you because honestly I like coming up to the holiday I still have the holiday slugged us you're right it's highway versus motive this whole dispute over network access there was a big dispute between the two companies highway apparently was throttled by motive that resolved itself really quickly. Yeah and we have my book getting on tomorrow I don't know if he'll speak to that or not or be willing to speak to you do ask him the question about whether or not that is going to be an ongoing issue but it does strike me something interesting because highway we've talked about this Matt leftler was on the air we talked about it highway seems to have more leverage in those relationships now then the other providers technology providers you depend upon it because so much freight runs through a highway certified. Broker or broker that's using highway in there for if you lose access to freight.

49:57Then you lose the carers lose an access to money and look I think motive that's why they blink. I think it was right thing to do for the customers to blink. You think yeah for sure well I know your bias. You're you're married to a head of product highway so I mean that's part of it just for the disclosure and highway is a sponsor so that certainly something as well but I don't you know my opinion is that ultimately I think motive misunderstood or miscalculated the power that highway has in the freight market because brokerage freight does if if a carrier is not authenticated by highway oftentimes the broker will move to especially when you don't have as tight of a market. Like when the market is as is not as tight as it has been then it means that that broker so not going to go out of their way to approve a carrier that's not a network that's right and especially with regulation and compliance being as important as it is right now I don't think anyone. I hope brokers are willing to take risks on an unknown carrier versus using the tool that they've they've put in place to protect themselves is an ongoing conversation another ongoing conversation is the world autonomous trucks and what they mean and where they're going to.

51:09The rat in terms of status and talk about that we have the CEO of humble robotics I'll Cohen is here with us for a ways today welcome to for a today are you sir. So you are the first cabless autonomous semi truck what does this mean is this one of those I've seen the videos of these sort of futuristic I think China they're more common. I've actually you know sort of feels like a little and I'm going to use this term and I mean this kindly dystopian world of not having a cab it's what it feels like to an old school trucker what is this. I know what what is exactly is this yeah and you're right they're actually already in China so so they're they're already deploying sort of what we call skateboard or platform to moving for it. It's not a dystopian future it's advanced and of technology is the way I see it and it's just another tool and a toolkit right so it's not it's not changing the way trucks work or displacing trucks drinking like that it's just one more way to move for it especially if you have a generally short movie needs to do.

52:14These skateboard concepts are really great. So what is so we've seen them I don't know if we've got any be role on this but the idea that you don't need basically a cab it's basically the chassis itself is powered and it strikes me that that is probably with this ends up in the future because they're just far more capital efficient. Once you eliminate the need for a truck driver to be in the cab why would you even have a cab. Yeah and I think that's where humble robots kind of got to start we were we were asking ourselves based on where technology is and where it's going what does a truck look like and but where it was commercial trucking go in the in the far future and can we bring that in sooner. You know the truck that we are the real we're never designed to be autonomous right so there is there is a design for a human driver to sit the cab and drive and be safe and pilot that vehicle so. So the question we're asking ourselves is where is that all go and eventually it goes to these purpose built vehicles vehicles design with autonomy in mind not just.

53:18Holding on sensors to the top of the vehicle like you see with some of the autonomous truck providers out there and so that's where humble sits where we're trying to look at that future and bring that in closer and see what we can do to design that vehicle for autonomy from the job. So one of the things I was having this conversation with somebody who's been in the industry for decades and we were talking about the fact that you know the concept of drop trailers or something that. The industry is really the larger cares that built their entire business model on having dropped trailers but in autonomous world particularly when you have these skateboard concepts for autonomous. You don't need drop trailers all of a sudden you're going to drop these skateboards off and the containers can get loaded and off loaded that way where does this end up. Yeah so this is a great question because if you think about a skateboard that doesn't you know that's just sitting at a customer site for example waiting for a doctor open right it's well time and well cost there is actually very low right so the benefit of drop trailers starts to go away in autonomous future you could just have what our vision is a vehicle that shows up at a dock loads and drives the destination unloads and it just does that back and forth all day kind of on demand.

54:31On call it's a different model for freight for how it'll progress in time but it's kind of where it goes in the time is future. Drop trailers work really well where you have a driver trying to optimize your time trying to make sure that drivers stuck waiting for a doctor to open anything like that but if you're able to sort of manage the vehicle and call it on the hand and deliver it to the destination it changes the model entirely that's what we believe. I've been told that at scale the price point for these skateboard concepts I'd love to get your talk about it so around $100,000 is probably where they end up in the market. Do you have any concepts on what you expect the technology what you guys expect the market price to be. Yeah so it can get even lower than that scale right I mean if you think about what a platform looks like it is very there's not much there right there's a way to power the axles and there's a battery pack. There's the autonomous technology so at you know in time at high volume you can go yet and park a little hundred.

55:31So I mean what I mean a full trailer a fifty three foot trailers you know fifty sixty thousand these days you're talking about something that is we're starting to get the price point if you know once we get to maturity I'm using today's adjust the dollars because there's no inflation is going to do everything around us but what you're talking about is the price point between a sort of an empty dumb box a fifty three foot trailer and one of these skateboard concepts the price delta is within range I mean is that the future that you would expect. Yeah in time I mean not today right because I think we have to develop technology and get it to to the right price point and we have to get the volumes up on it to see that kind of pricing right that there's there's millions of trailers out there right and and so the price point there is fairly low but but they are creeping up right fifty sixty came out for the fifty three foot drive in and but in time yeah if you think about what is in these in these vehicles is fairly simple right that's the whole idea is that you know the movement of free from

56:36the industry and I imagine that the more simple the solution is and the equipment is the less the maintenance costs are and all of the electric as well electric I mean one of the well documented things about electric vehicles is that they don't have the less to break less I mean just less moving parts you know talking about like one tenth of the moving parts in an electric vehicle versus a total combustion engine I mean now there are sensors and all those things that I'm sure I mean it is a computer right so even the electric vehicles have full so I mean even the internal combustion engines or decals have the point have all those sensors they have sensors the real where it's all hit yes it is different between combusting you know thousands of times a minute for us you know just motors moving and batteries that are well understood the maintenance of these vehicles is going to go down tremendously even the sensors it's kind of newer technology there's not a lot of moving parts in them right and moving parts are usually what because a lot of maintenance have it for us and fluids you got fluid issues you have lots of lots of stuff that you

57:38don't have yes so you gave us sort of the example of of the future you know being one of these units goes and loads unloads goes to some association loads unloads so tell us more about what that future looks like with the actual amount of human intervention needed or not needed at loading and unloading and why that short haul dock to dock freight is probably what the future looks like yeah so you know I think humans will be involved for a while right it's it's even even if you're getting the driving portion of the move done autonomously they're still yeah there's loading and unloading we have a remote oversight of the vehicles right so there's still CDL holders were watching vehicles remotely and so you'll have that kind of touch point there's still maintenance there's still inspection requirements right all the all the loss of trucks still apply right so we have to make sure that those are being that where the vision goes you know where we look at the far future though to me it's it's these warehouses that are automated it's voting unloading they're automated and free moving automated and you have an entire supply chain

58:46link automated all the way through that's that's the far future you know in the interim we still have you know a lot of human touch and ball mix or make sure that's the average number of operations of our etcetera so I'll win in terms of timing I know you get tired of this question because I get tired of everybody whenever I go on any kind of network that's when is a ton of the trucks happening I know you get asked that all the time but would love for our audience to get a sense for what timing you think will start to see point to point transportation. I started working on time is trucks in 2016 which is about as all this industry is right and you know we we thought it was always a couple of years away right but we're working we're talking about something that is very safety critical right we have to work within existing operations there's trucking is fascinating and it's awesome and it's complicated right so you have to make sure that all works well the inventory loss so it took time and it's taking time but yeah I would say a time is trucking is just about here you know that it's already you know you see companies like Kodiak they're they're doing their operations offer out but they're doing it Aurora's got their their their back and force in the highway so so every year we get closer and closer to the

59:56adoption and then at some point that meaningfully complex so I think it's time is trucking is more or less here it just took you know about a decade to get the technology working right so I want to get your thoughts on something that I've been talking about you know I've been talking about it for years but but I'd love to get your thought about sort of this evolution the question you know one of the reasons the trucking market is so fragmented is because of the truck driver is the primary reason the market so fragmented but once we enter an autonomous world where autonomous vehicles argue big what is it strikes me that the fragmentation starts to go away over time where it's technology that wins out and this happens in every meter industry where you have technology winners you can look at it as search you know a lot of the modern and I know this running a media business is it is very hard for us to compete for dollars against Google Facebook Instagram all the different platforms because they take the predominance of dollars and the only way to survive is to sort of carve out niches like freight waves where the platforms will never compete against you but you still have this sort of competition

1:01:03it strikes me that trucking probably ends up in this way too and the question is for freight brokers specifically what happens in a world where autonomous trucks because really the freight brokers advantage is that the fragmentation works to their to essentially are the market but in a autonomous world those arms start to go away thoughts there yeah that's a great question I see things centralizing over time and the fragmentation is kind of a consequence of how trucking has formed over a hundred years but it's not what you see in other industries you don't see this kind of extreme fragmentation and a lot of parties are involved in the process of moving for a I think technology will bring that to bear and there will be a lot of centralization for sure it's just the trend that you see basically not really other industry and your example of media I think is appropriate right I think that's very fragmented in starting centralize a little bit there will always be this sort of niche market and I think trucking has a lot of niche markets right like you can go into the forest you go into ice and there's always sort of new domains that kind of require that there will still be a little bit more fragmented but for the bulk of it will be centralized

1:02:16I you know it's interesting Julie I think the asset based the large asset base carriers that cannot adopt the technology quickly are going to get completely wiped out I think that's the big market carriers that are at the most at risk I think it's true in the brokerage too unless you have a niche so it's interesting because I think what we're going to see is we're going to see the largest brokers are probably well positioned they have the capital they know how to market like you think about it they're much better marketing agencies than a lot of the asset guys you know most of the asset guys spend their time on maintenance and driver recruiting that's where they win in an autonomous EV world maintenance and driver recruiting is not a factor so large asset carriers have a lot at risk in an autonomous world if they don't adapt technology they get to move their business models large brokers are well positioned in my opinion now the mid market brokers I think and smaller I think it becomes head to use the term deadman walking yeah I think it is something that is going to be very hard for a lot of people to adapt to and and I guess what I need and I know I'm going to go a lot of hate on this one but what do I need a freight broker if I can access a network directly if I have a shipper can access a an autonomous vehicle and there's no more driver safety concerns I don't have driver safety or driver compliance you're probably going to have a dim the vacation maybe humble I assume you guys are going to have a driver safety concern

1:03:43I assume you guys would be selling this equipment to to some third party versus actually running the trucks yourself I don't know I all have that's your thought so so there can be a third party that has the trucks and has the equipment and then it's a then it's a really a contest a capital and marketing I mean that's really I mean data sciences there as well but with AI those models get my next piece to understand the shippers so so that's the one part is the ship is still going to continue to have very different requirements, right but doesn't the larger asset carriers. That understand these models don't they have the advantages absolutely that's what I'm saying but if you think like that's really the only differentiator right if you think about you're to stand your specific customer's needs and then can adapt to this technology to meet them. But most mid-market, mid-sized motor carriers have made their business and have succeeded because they have the ability to hire and retain truck drivers, and they know how to maintain trucks. And in autonomous world, that is less important.

1:04:45In fact, it might be a disadvantage to you because all of your advantages are on those things. I don't know how. You can margin out of those things where others can't that are no longer going in. The mid-market carriers and smaller carriers succeed. A guy with 50 trucks exists either because he has a strong relationship with one or two major customers. Or because he's figured out some way to recruit and retain drivers in a way that larger care, they have personal relationships with every truck driver. In the autonomous world, that isn't a factor anymore. I think that the carriers, the ones that we work with, they have great relationships with their customers, the shippers, and the service of brokers. And I think that's important to stay with. That still matters. Because there's unique requirements. And aside from the drivers, they also know how to maintain the assets. And they know how to manage an asset pool and maintain it. And I think those are still necessary skills. And there's going to be other aspects to autonomous driving. There's maintaining sensors. There is remote monitoring of the operations.

1:05:46You guys were talking about Carbafft, and your previous segment, that becomes an interesting question in the autonomous world. And we have to really be on top of that. So I think those carriers have the capacity to manage those functions still. And I think that's where it goes. So here's the thing I think we'll see. And I think we'll start to see this in within five years. So once we see autonomous, I think the well, the very successful freight brokers wind up buying asset to get that maintenance optimization sort of pedigree. I mean, first of all, freight brokers tend to be a lot more financially successful men market than the large assets. Asets is the very capital intensive business. They have better balance sheets. I think they'll, I think we'll end up seeing this in consolidation where the better capitalized brokers will end up buying assets because they don't have. I mean, Doug Wagner, the CEO of ECHO says it best. Most brokers do not know how to run trucks if they're like, they're not. Well, the same way that they get into the trailer market, right?

1:06:47They started buying assets as trailers to just well, but they made the mistake. I mean, they didn't know how to manage. They didn't know how to manage it. I mean, they were learning curve there. Are they gonna plan these assets appropriately to drive full utilization? I, here's my, here's my thing. And I told Daniel this this years ago that if I were him, I'd go buy a large asset based on founder of Convoy. I'd go buy a large asset. Take that $4 billion valuation and use it to buy an asset carrier. For their talent? Well, how to run systems? How to run networks and how to run trailers? Two things that they did not understand and rest in peace, Convoy, because when you buy or release thousands of trailers, then you don't have someone on staff and is that an operator? There's a trailer sufficiently, it becomes a capital drain. That's what they should have done. They should have used their massive, massive market position to buy an asset.

1:07:48You could have bought USA truck when it was trusted. Could have bought USA express maybe? I'm saying that as a, no, actually, it's that idea to Dan Lewis. I was like, you know, I should buy USA express. Anyway. Well, I think there's always that kind of, what are you an expert in, right? And you know, we're experts in, a Thomas driving and sort of, you know, developing a truck. I think you can't be an expert at everything, right? That's one of the challenges, I think of this business. There's so much to it, right? I do not issue challenging. There is, you know, we're seeing this in venture capital out in the valley is a lot of, you know, a lot of venture capitalist are now doing roll ups of buying traditional unattractive businesses from V.C. to roll them up. Agencies are a good example. That's consulting businesses, another good example. With the thesis that if they roll them up, then they can use AI to cut a lot of the, you know, a lot of their, make the businesses more efficient, you know, economics gains their AI.

1:08:49So I can see a world where the non-asset based carrier say, hey, I want the knowledge of how to run equipment. That is something that is not natural for someone that's in a non-asset based work. I can see the making the case to go by a mid market well-ran asset based carrier. Yeah, I mean, well, things are changing rapidly, but you know, the, you still have to ask whether a venture capital term can run effectively a truck operation, right? We haven't seen it yet. I mean, it's fair as well. I haven't seen it yet. I would say it's a thesis, right? It's a good one. I mean, like, I'm just, I, look, those that can't do teach and do or sitting here talking on freightways today. So I, it's easy for me to sit there and play money board a quarterback and guess what's gonna happen because I don't actually have to go do it. I have the benefit of being, you know, I don't have to prove it out, but it does strike me as a really intriguing set

1:09:50of conditions that the world's gonna change. We don't know what it's gonna look like, but my view is that that we're gonna see massive consolidation that comes out of the autonomous world, regardless of what it comes to. I think it's gonna be some interesting marriages that come about. I did see them. Yeah, we see the same. We agree. So I'll thanks for coming in and joining us on freightways that I want to have you back as we see this. You got to bring some B-roll with you, brother. I wanna see you next time. Next time, let's get some obelisk, autonomous truck things. You've seen these things in China, right? These weird like, they just look weird to like boxes and things. I'm sure we have some. There you go. Is this it? That's it? I love it. It's cool. I need one for the museum, but most of the museum needs one of these. Like we need to put this in there. Even if it's a scale model, I don't, do you have a scale model? No, we have a real vehicle. It just comes to the real vehicle.

1:10:50You could, you know, I'm looking one for my museum that we're building. So maybe if you get some extras, we could put one in there. How about this? We didn't make a Lego model of the, we called the horror. We'll send you one, but you have to go to the shop. This is really cool. That's gonna be a project for you and Mills though, if it's a Lego model. I know. Right. And then you can put it out and you'll be so proud. Models are cool. Something to do. Look at this thing. That's pretty sweet. We're shipping out two Lego models today. We'll keep it on, keep it on offering. All right, perfect. I'll appreciate you coming in. We'll have to have you back as we, as the story develops, gonna be one of the best interesting stories, certainly the next decade. Yeah. We'll be here. Thank you for having me. Appreciate it. Thanks for coming in. Take care. Come back with us. We're gonna talk about your ship. We're gonna talk about automation. Different kind of automation, but something we're all interested in the future of freight with the U-ship CEO right back up. Getting reliable capacity can be complicated. Let Arxo make it simple.

1:11:50As the third largest provider of broker transportation in North America, Arxo has the scale, resources, and expertise to help you tackle any shipping challenge. From a last minute spot load to a managed transportation solution, from LTL to Intermodal, from train logistics experts to AI-powered freight automations, Arxo has you covered from the first mile to the last mile. Start shipping on easy mode with Arxo and get a smart solution to move your freight. Learn more at argso.com slash capacity.

1:12:51The world doesn't wait. So neither do they. Wheels on the interstate. Boots on the sides. Hands on the ship. We build for the world out here. And we build it with the people who live it. Ideas from the field made real by world class R&D. To keep the operation sharp, the front line safe, and the world moving. From one cab to a global network, billions of miles, trillions of data points, everyone making your operation better. And we never build it alone. Thames are built with operators.

1:13:55Once a year, the entire freight industry stops what it's doing and comes to one place, Chattanooga, Tennessee. This is F3, the future of freight festival. It isn't just a conference. It's the largest festival in freight built to pull you all the way in. The energy, the ideas, the atmosphere, and the people who move this industry forward. Over 50 speakers. Four events across three days. Founders, executives, innovators, and disruptors. All under one roof. All asking the same question. What comes next? On the main stage, the sharpest minds in freight take on the biggest questions in the business. The trends, the technology, and the forces shaping what's ahead. Then the clock starts. Seven minutes. No exceptions. The cutting edge of freight tech goes head to head live, battling for best in show. When the time's up, the lights go out. And in between, the conversations that don't happen anywhere else. The connections that change the trajectory of your business. The relationships you'll carry long after you leave.

1:14:56Because when the sessions end, the festival begins. Live entertainment. Unforgettable experiences. A celebration of the world of freight. And an energy you won't find at any other event in the industry. The leaders you need. The access you won't get anywhere else. This is where knowledge is shared. Where deals get done. Where the future of freight gets decided. F3. Future of freight festival. October 27th and 28th. The signal. Chad and Nougat Tennessee. We'll see you there. Register now at live.fratewaves.com. Welcome back to F3Ways Today. It is Tuesday, Labor Day, post-labor day. We're going to continue the conversation around autonomous and autonomy.

1:15:59And automation. We have the CEO of YouShift to break it down for us. Sean Wu. Sean, what's going to F3Ways today? I don't know why you guys. We're doing great. You know, we have been talking about automation in all forms. You guys sit in a really interesting intersection of a marketplace, business that matches buyers and sellers. More so on the sort of consumer side than we typically deal with and trucking, you know, different types of equipment. We'd love to get in that. But we've been having this autonomous conversation with our prior guests, the CEO of Humble Robotics. I'd love to get your take on the autonomous story. What does the world look like once we get to autonomous trucking? Once we get there, I think it's already out there. You know, it's 28 states. They already have trucks. Half the states already have trucks that are out there. Moving frayed testing.

1:16:59Those kind of things. We could kind of see a little bit of how it looks like when you take a look at Waymodes. Right? It's lower accident rates. There's lower injury, raise lower claims. Those are kind of the themes you could kind of carry into for the trucking space. Well, I'm not really talking necessarily about the safety issues and what the fact that these things can exist. I'm referring to sort of a business of freight movement. I mean, it's a very small, tiny, tiny, tiny portion of freight is moved autonomous. We're talking, you know, a very small fraction around an era that we eliminate in all autonomous. No one would notice the day. What I'm asking for you, if you could comment on once we get to point to point autonomous across the market where it is a representative sample or a very large percent

1:17:59overall freight movement. What happens to the economy in terms of freight economy? Do we see consolidation? Do we see the intermediaries by assets? I mean, any thoughts there? Man, so, you know, I started my, I was a, I was a bean counter 15 years ago. And before, there was a, there was a big eight in the accounting firms. And right now we have big four. I think consolidation is going to happen. No matter what, there's a question of what are you going to do about the three, four million, however many truck drivers that are out there and what regulation will do to slow it down. But to your point, I think consolidation is going to happen. Whoever's in the top 10 logistics companies today, we're probably going to see a lot of that. And the very high, even public companies and definitely in the smaller mid market as well.

1:19:02Yeah, I think they would move faster in a post Montgomery world. I mean, with C.H. Robinson, the Lupus thing is you want the safest form of transportation. And the drivers themselves are the risk profile, both on, you know, safety issues, on time service. Anyone who's been trucking knows, I mean, this is, I'm going to get some hate message about this. But it's true. If, you know, as a dispatcher, as a broker, you're only as good as the weakest length. And oftentimes that's whether or not the truck driver does the job that they're, and look, drivers know this too. You get a bad truck driver, causes problems. With autonomous, you, you at least have some assurity and predictability that you wouldn't have with a human driver. Craig, you are going to get a lot of hate mail for that. I'm, dude, I'm used to it, man. For sure. For those that want to send me hate messages. Yeah, the public perception, I be, I be care is to see what the general public perception is. Right? Like if you look at the data, it would say a lot less accident rates.

1:20:08I don't have it, you know, I'm from you right now. But you, you know, there is an emotional feeling to that. If I'm a driver and I, you know, I'm on my way to work and I got, we're on my way to drop off. I got the kids in the back. And I see this huge, huge semi truck barreling through with no drivers in the front. It could be a, it could be a well thing to see. I think, I mean, look, I think the data is very clear that for the most part, you eliminate a lot of human errors that are in it. There's just are always going to be human errors and anything that any of us do, right? And that doesn't mean... Distracted driving, you know, Julie, you and I interviewed someone a couple of weeks ago where distracted driving has taken over as a higher risk point than alcohol and drugs in terms of, of predict. So you have phones, just on your phones. Yeah. And it's, look, I know how 10th and it is to be on a phone. I mean, it's, it's a fact and human psychology is that you get... Or even just navigating all the screens on your dashboard now with these cars, right? That's, that's tough as well. I know, trying to figure out where stuff is and because they put, they try to compete.

1:21:11So Sean, tell us a little bit about what you ship is up to these days. How are you guys thinking about the business and sort of the marketplace? Well, look, I got right into it. So it's due for a 60-second intro on you ship for those that are not aware. Where are marketplace for shippers and carriers to move large and bulky items? Specializing a non-profile freight, household goods, heavy equipment, boat antiques and the likes. But you'll also find instant rates for cars and LTL. So a shipper can create a listing for their item, get bids from multiple different carriers, or name a price, just get them moved. And a carrier can find loads, fill back halls, minimize dead miles on our marketplace. We don't do any parcels, just the large and bulky stuff. And so that's what you ship does. And it's kind of funny. You know, we're talking about autonomous driving, automation in general.

1:22:11And then there's you ship in what we do and what we specialize in a non-profile standpoint. Your earlier question around, you know, what do businesses need to do to deal with this? We actually lean in a little bit into the non-autonomous side of things. As you can imagine, well, I'll tell you what, we just moved a three-ton hot tub about a month ago or so. There's no amount of standardization that's going to, you know, there's not enough volume for that. There's no amount of standardization that's going to get that thing on autonomous driving. It was multiple coordinated efforts, different parties coming together to try to get that done. And those are the kind of things that we take pride in in moving. You guys have always been the leader. I mean, you just have a TV show years ago. Are we going to bring that back? Oh my gosh. You know anybody in A&E or you got, you know some producing? I mean, luckily, I'm sure we could make the case for it.

1:23:13That was what, 20 years ago, Sean? I want to say, it was nine seasons, it was ten seasons long or something like that. Shipping board, I guess it, 2012 to 2015, this says, shipping board by any. So it was only ten minutes. My timeline is so messed up, but go ahead. Yeah. Just like five years ago. Yeah. So I enjoyed watching it. It was a good, good show. So we've been talking to Sean about autonomy, but as you said, you know, you guys lean a little bit less into that being necessarily the best way to provide efficiencies. So what are other opportunities for improving freight efficiency that maybe are less flashy or maybe are less fun to do? Or less fun to talk about right now than autonomous vehicles, but what, what are you seeing otherwise? Well, if you're the non-profile, you know, division in any large logistics company, I think it's going to be ever more so important.

1:24:14Your job is to get the non-profile stuff out of your network, right? And you focus on winning on damage rates, on injury rates, when there's cross-stocking involved claims, maximize your truck volume because that weird couch or antique desk is going to take up an abnormal, the amount of space and the truck. And so, you know, autonomy really works really, really well when things are standardized to the extreme. Highly repeatable, yeah. Really highly repeatable. And so, if I were to just borrow that example, I just gave about the three ton hot tub, that's not a very repeatable thing you want to prepare your network for, right? But maybe you took that because you're trying to make your client happy and, you know, you're a household name, and you want to be able to offer a solution for that. So one of the things that I would imagine that non-profile department wants to do is like just get that out of our network.

1:25:14How can we find someone a partner, someone else to help us move this thing, still focused on service, still focus on protection? You know, I think that's one of the things that companies can do to lean into standardization because that is happening. And autonomous driving AI is going to make that very, very attractive. So Sean, I want to talk a little bit about, you know, marketplaces are really, we've seen a lot of fraud happen in marketplaces, a lot of cargo theft. It's sort of become a big source of issues we cover frequently on the truckload side that load boards is where because it's an unknown party. You're dealing with, in many ways, a even longer tell of capacity than what, you know, a lot of the freight brokers are dealing with. How are you guys helping your clients deal with the security issues that are taking place in marketplaces? One of the benefits of being a 22 year old company is that we have a network of drivers

1:26:15that's built, that spend years and years building that profile. The reviews that they've gathered, that is very important. And we share that level of transparency with the shippers. Right. You add that on top of our general marketplace trust and safety standards and procedures. You add that with the protection plans that we have offered on our platform. All that goes together is how we make sure that our marketplace is safe. It's protected and that shippers can find a lot of comfort while still getting to choices that they want. So one question I have, and I had this product that I wanted to ask you, and I had this person on my wife move from Manhattan to Dallas, Texas, years ago, this is 10 years ago. She actually used you ship and had her house goods held hostage by the driver, refused to deliver it, said, oh, I miscalculated the price.

1:27:16Now it's going to cost you. I think it was double. It's before I knew you, Sean. So I couldn't call you, I'd be like, what the hell is up with this guy? But how do you, I mean, that I've heard this, and this is a frequent scam, if you will, that takes place for moving, you know, household moving goes where you have really, I wouldn't call it unsophisticated party, but, you know, sort of this issue where, you know, this is not a business, this is a B to C transaction between two parties. How do you guys handle those situations where somebody's in household goods specifically, their movements are held hostage by, you know, in this case, was a mover that had loved it. The mover that had loaded all the freight into a truck, it was then, you know, interdoped, changing the terms. Yeah. Well, I can't comment on any specific cases, but I, what I hope your wife did was reach out to you, ship support, because that's what we're here for. Right. A lot of times we'll go in and we'll mediate the situation.

1:28:18As you can imagine, for household moves, for moving cars, if the things that you said you were looking to move, or the car you were looking to move, turn out to be different, or there was, or there was stuff in the car, that could make it particularly difficult to adhere to the original price if terms have changed. And you guys are investigating sort of like Airbnb would do in terms of the house. If I have a problem, is that the thing that's right. Yeah, that's right. And if we found that the, the carriers were at fault, we would step in, and we would, we would help out, we would help out your wife, we would help out the shipper for anything that extra cost, or we're getting their stuff back. So I want to talk about the other major issue that's getting a lot of attention, particularly in the freight broker in a media area issue, is the Montgomery, post Montgomery world, where freight brokers can now be available for their counterparties.

1:29:24It's obviously an issue when you're dealing with smaller vehicles that you don't know. How are you guys helping your, your, your customers really navigate and, and really vet these players around safety? We bring choice to front and center, right. So we're marketplace. The Montgomery case applies to us less so, because we prefer, you know, we don't select a carrier for you. We don't set the price for you, and most importantly, we give you a lot of options for you to choose from, and we let you create your own listing, so you can describe the things that you're looking to move. And what about your customers? I'm not really thinking about you ship specifically, but the customers that are using the platform, where they're, you know, they're booking a transaction through the platform, or at least matching to someone. How, how do you sort of navigate that in a world of safety? From a ship or side, or from the, on the ship, on the ship, on the ship or side,

1:30:26we keep a profile reviews on all transactions for our carriers. And you can kind of see, look, this carrier has been around you ship, you know, since the shipping war days, and has moved tons and tons of items, similar to perhaps to what you're looking to move, and here are their reviews that you can see. So that's one of the primary ways that we help our shippers to navigate, hey, who's actually moving the things, and you, you know, you can kind of see, look, someone's been here for a long time, and, you know, a lot of our drivers, they're livelihood, they make their livelihood on your ship. So Sean, is it easier? I'm just curious, in a world of electric vehicles, you know, we were talking earlier about internal combustion engines versus electric vehicles. I would imagine that moving in an EV is actually less hazardous than moving an internal combustion on a truck. Is that, am I wrong about that, or how do you guys think about it? Moving an EV versus moving it on a...

1:31:28Yeah, EV is... Maybe you were transporting a car that was electric to the car, right? The car goes in EV as opposed to the truck in EV. Yeah, yeah, yeah. So again, we're in marketplace, and so what we do is we provide instant rates from carriers, from brokers directly to our shippers, and allow them to choose. So all of our carriers and brokers have their own formula for pricing, for pricing EVs. You know, you all you got to do is provide year-making model, and you can probably find a half dozen quotes right there, right then, on our website. And how would you describe the current market right now, Sean? Is it... Are we seeing... Is the market really liquid? Is there a lot of activity? Have you seen pullback in terms of movements? I mean, people aren't moving homes these days to the degree that they were. What are you guys experiencing on the platform? Yeah, there's a... Because of the move, everything large and bulky, you know, I think cars has its own story, household moves as well.

1:32:35Those are the two that you've touched on. The secondary market for household goods, we're seeing that take up. We're seeing prices gone up quite a bit. That's probably not a surprise for anybody. Just take a look at the price of diesel and at the pump, and you can kind of see that right away. That's carrying over to the cost of shipments. In cars, we are seeing some capacity constraints. We're hearing that from our carriers. We're hearing that from the brokers on the car side of things. From household goods, we're seeing a small revitalization of people selling the stuff around their house. People holding on to furniture a little bit more. And bringing that with them, you know, wherever they go. And then in the household moves segment, you know, we're not seeing as much volume as springtime. We'll see how this upcoming springtime is like. That's usually the super bowl of household moves. But with people not buying and selling as much, we're not seeing a lot of that demand there.

1:33:39Yeah, that's, I think, we would all like to see the housing market come back. I think it would be good for everyone to see a more dynamic, dynamic housing market. Sean, appreciate you coming on the fray was today. All right. Well, thank you guys. Appreciate it. So, Julie, it does strike me that people are not moving houses, but they are doing more projects from some of the hardware stores are doing better because people are not moving. If you've got a, you know, two and a half percent of the free percent interest rate, you're not inclined to sell your home, which is a big problem. So maybe you are, you're not doing, you know, big moves. Maybe you're just moving, you know, small things around. Right. Investing in the home that you now take a three. You know, in New Jersey, I was talking to my wife's family this weekend is a lot of people are, you know, they have free bedroom homes. And they're now adding on a new bedroom because they're not going to move. Yeah. Interesting. We'll be right back. We're going to talk about diesel again. These surprises are at record highs and Matt Cartwright, founder of Magnus Technologies is going to tell us all about what they are seeing and what they're thinking about in terms of fuel.

1:34:47At SIA, it's a yes, isn't just an answer. It's how we're built, a way of working, shaped by our people, our nationwide network, and over a century of know-how that keeps freight and business moving. From coast to coast and across borders, our full service freight and logistics services turn yes into real solutions for real business challenges. Deadlines change, conditions shift, SIA is ready for it all. For every customer, every day, it's a yes. The world doesn't wait. So neither do they. Wheels on the interstate. Boots on the sides. Hands on the ship. We build for the world out here. And we build it with the people who live it. Ideas from the field made real by world-class R&D. To keep the operation sharp, the front line's safe.

1:35:52And the world moving. From one cab to a global network. Billions of miles. Trillions of data points. Everyone making your operation better. And we never build a long. Samzara. Built with operators. Once a year, the entire freight industry stops what it's doing and comes to one place. Chattanooga, Tennessee. This is F3. The future of freight festival. It isn't just a conference. It's the largest festival in freight. Built to pull you all the way in. The energy. The ideas. The atmosphere. And the people who move this industry forward. Over 50 speakers. Four events across three days. Founders, executives, innovators and disruptors. All under one roof. All asking the same question. What comes next? On the main stage, the sharpest minds in freight take on the biggest questions in the business.

1:36:55The trends, the technology, and the forces shaping what's ahead. Then the clock starts. Seven minutes. No exceptions. The cutting edge of freight tech goes head-to-head, live, battling for best in show. When the time's up, the lights go out. And in between, the conversations that don't happen anywhere else. The connections that change the trajectory of your business. The relationships you'll carry long after you leave. Because when the sessions end, the festival begins. Live entertainment. Unforgettable experiences. A celebration of the world of freight. And an energy you won't find at any other event in the industry. The leaders you need. The access you won't get anywhere else. This is where knowledge is shared. Where deals get done. Where the future of freight gets decided. F3. Future of freight festival. October 27th and 28th. The signal. Chattanooga, Tennessee. We'll see you there. Register now at live.fraitwaves.com.

1:37:56Welcome back to Freightways today. We're going to move on to Matt Cartwright. He's the CEO and founder of Magistatnology.ms. Welcome, Matt. How are you? Thanks. I did a great. Are you? Good. So you've got a diesel fuel snapshot. What exactly is that? And obviously that seems really important right now. Sure. Yeah. So we publish information. It's just a channel to get information out to our customers as well as other people who are participants. And it's really just to make sure that people are fully aware of the cost of fuel and how that impacts the fleet that delivers the freight. So it's a channel. We're not only can we publish the pricing but methods to help our customers solve for those prices and to offset those prices, whether it's via improvements in fuel search, our operations, all the considerations that go into the cost associated with running the company.

1:38:57So when you look at fuel, are you guys using wholesale prices, rack, you know, cost plus type data or is it retail that you're analyzing? Yeah. We look at all of them. I mean, each of our customers has different methods that they look at for fuel. But typically we're kind of targeting the the published indexes. So yeah, I as well as a couple others, just a set of benchmark of what's what's commonly considered the cost of fuel. Certainly we support our customers that use hedging and other strategies around that. But both of our companies and the fleets that are out there are really looking at just that index to sensitize to what is their cost covering. So Matt, I want to talk more about fuel and where there might be some opportunities where we're some of your users might might be able to mitigate some risk by using this.

1:39:57But first we back up intelligence a little bit about Magnus technologies as a whole and how this fits into what you all do. Yeah, so Magnus technologies in a process based company, we start building from the ground up to accommodate all the efforts around running a truck company. So it's everything from order management to EDIs with your trading partners, fuel ingestion, cost, fuel cars, all those all those considerations invoicing the customer. And it really does handle the entire life cycle, quote, to cash for our customers. And we feel like that's a really important distinction in that if you if you can't see the entire cost structure and revenue structure in a single platform, it just gives opportunity to to not maximize the yield, yield associated with improvement improvements or opportunities like fuel search, charge calculation, how is that going to automatically invoice and offset the cost as they rise.

1:41:05Kind of uncontrollably. So speaking of those fuel costs and some of the volatility we've seen, how are you advising your users then to be benchmarking and using this fuel information that you're putting out in order to, I guess, protect themselves from being on the wrong side of volatility if they've got a more slowly updating fuel scale or to potentially be able to take advantage of that. So I think part of it is just getting information out there and that's part of the reason that we publish the index and it's they have to go upstream a bit to understand the dynamics of what the true cost of their programs are. And so a lot of times there's an education consideration for their customers where if you think about the point of fuel search, it was to really neutralize for everybody so that we didn't or the carriers didn't have to shoulder that that burden alone.

1:42:11And there are a number of strategies that were older that don't take advantage of the data that we have, but ultimately we have with our platform the ability to know how much fuel is consumed on any given load and that's really what tells you the cost of the fuel that you used to deliver the freight that you've been asked to deliver. So it's kind of multifaceted the first is education showing our customers and ultimately their customers how fuel is consumed and how it's calculated and the impact of them so being able to allow them to report back to their customer base. The good and bad of their fuel search or program and then when there is flexibility helping them craft a message that gets them the best offset to fuel to accomplish that mission of making fuel just kind of net neutral and not just a cost driver for them that they have no control over.

1:43:17So what inputs do you take in and how are you actually calculating that true cost of a fuel versus just whatever is being estimated with a fuel search charge. So we have full visibility of any time of trucks moving so what the truck is doing where they're picking up where they're delivering the miles that they run, how much time the truck was spent eyeling all the consideration of what contributes to the actual fuel consumption and then we bring that back into our invoicing modules that say this is exactly what was run at the date and times that in time span that it was going to be a lot of time spent. So what was run pulling the indexes or their contracts and give them a report back on what was the real impact of the fuel that you barn to live that freight versus what potentially you could recover in a fuel search or charge or should be recovering a fuel search.

1:44:18So there is a bit of flexibility in contracts and I think we found a lot of folks don't have systems in place that can dynamically recalculate the fuel search or charge that should be charged based on how they're running the freight that that's there. And so there's from an ingestion perspective, it is consumption and purchases and then tie back to the index and then helping them look at the contractual obligations or opportunities that they may not be or have not previously taken advantage of with our systems, we can do that. So Matt, you guys have a really interesting history for the business. You started out as part of United Road in 2001. I believe you were there from the start and the auto shipping work business. That market has been I don't know if it disrupted is the right term, but certainly, you know, Jack Cooper's failure, you know, we've seen a lot of volatility in that industry. Tell us a little bit about the observations of the auto and by the way, is that still the core part of your business?

1:45:22Yeah, it's a big piece. That's where we started from. So it's kind of where we fit naturally and certainly with our history, we continue to grow there. We're the largest provider in the industry, I don't know percentage wise where we are, but it's a critical component of how we formulate the systems and the interesting thing about that start is it really does contemplate all the considerations around the market. What happens when you're shipping freight and vehicle freight, obviously little different, you have specially equipment that makes it even more difficult. I can't just redeploy my car hauler to go, ship dry goods or or palatize goods. So they had a little bit more challenge there, but those those same characteristics or opportunities are more available, I think, on the drive freight side where it's just a little bit different and they can switch to different freight types at any given time.

1:46:28And so as the freight demand ebbs and flow, there's there's opportunity for those companies and those customers of ours to move in and out in a seamless manner. And of course, take the learnings that we've had over the years with working with the four to 10 companies all the way down to individual shipments where you have to be aware of the cost because the equipment is expensive, true of car haulers. There's generally is more expensive, but the capital requirements for all these charging companies are really high. So, matter, you guys taking the same technology and really trying to diversify into more of the for higher van market outside of the auto market is the most we think about what's going on at Magnus. Yeah, that's definitely a fair assessment. There's so much similarity and overlap when you're when you're looking at shipping freight. And again, the freight characteristics don't necessarily drive what has to happen. Ultimately, everybody takes orders.

1:47:28They they have trucks, they have drivers, they have equipment, they have integration requirements, they have reporting requirements, they obviously have ancillary considerations around that, but there there is a significant amount of overlap and opportunity. And it kind of goes back to how we started the platform, which is it needs to really be in and needs to be fully aware of what's happening all the time. Transportation companies, trucking companies in particular, they're already running it then margins. And so anything that we can do to help automate that, assimilate that into highest yield capable is there. And so at Magnus, we definitely feel like there's a lot of opportunity on the non-specialized freight or general freight market. We've seen a lot of companies, we've covered a lot of companies that are heavily tied automotive and the problem with automotive freight is it's a highly concentrated industry with a couple of major customers. And these customers are huge, you know, talking tens and maybe hundreds of millions of dollars to an individual company.

1:48:32But that also creates enormous amount of risk if they decide to move on or they're having, you know, and say financial issues, although that has happened, certainly in your career. Just changing providers and, you know, service requirements, we have a company right now with public Pam transportation who's struggling because of its high concentration auto. Is that part of the reason you guys are diversifying outside of auto? Yeah, I think that's part of it. But I think there's a lot that we can offer that hasn't been available to some of the companies out there that are transportation space. You know, the whole fleet is comprised of, I don't know, I think it's around 90% are 10 trucks or less. And for them, they just haven't had access to solutions that can make a difference to them. And so I think we're more diversifying because there's a need there and we feel like we can fill that in a way that's beneficial to the broader fleet.

1:49:38And with regard to the vehicle world, sure, I think one of our considerations was same as what I mentioned, where you have to educate the customer first. So whether it's general mothers or Stalana or Mercedes, a lot of times they don't understand the full impact of their processes. And because we're such a significant player in that space, we've had a good opportunity to work with each of those manufacturers directly help them understand and build systems that can fit within the paradigms that they have. And again, attempt to best capture the intent of fuel surcharge, which is to neutralize it to the to the carriers when it when it comes to how it's calculated, how it's paid, how it's invoiced all the all the contributing considerations there. Now Matt, prior to you coming on our last guest was with the US ship company that's involved in a lot of auto also Austin based Texas Austin Texas based company involved in a lot of mostly consumers moving automotive is around not not so much big dealers and big OEMs.

1:50:44But you know, we've talked a lot about the fraud, the security and safety issues taking place across the country. What are you guys seeing in terms of how your customers are dealing with these issues right now? Yeah, we're a little bit more insulated. So with having a single system that has full visibility throughout, you know, we're all the way out to the driver. We have kind of a close to perfect chain of custody for freight so we can see who has it where they have it. You know, one of the initiatives that we worked on with the railroads years ago is kind of ingagging outgating process GPS, date time stamp, you know, a thorotative QR codes that allow them to have access. So we're going to have a lot of customers with the mobile apps that we have were kind of had track and trace throughout the freight's life cycle. And then of course underneath because we have the direct integrations with any of their trading partners or the customers directly or the shippers of you will.

1:51:50We are almost naturally insulated from some of the disconnected transactions that happen in the freight world. So we're dealing with large, the large OEMs that are not broken and freight out. Not really. So we handle all of it. It's because of how we design the systems really to have full visibility when we, you know, we have customers that do brokerage, if we get a mouth brokerage on the platform. So one of the things that we were cognizant of is is that track and trace component. So drivers who are hauling whether they haul one load or more 100 loads for any of our customers, they download the mobile app. They have, you know, there's no fees to them to download that and that gives our customers and the end customers, the shippers that full visibility throughout. And that kind of perfect chain of custody. So everything's logged when they arrived, what time they arrived, what they picked up. There's confirmation of what they picked up. You know, even things simple like taking pictures. We had buildings supply companies who would deliver products and there would be loss.

1:53:01When I just take a picture of AI goes and counts the number of two by fours that were there. And so we've got again, kind of that full in the end view. What was picked up, what was delivered, where was it, who was it picked up, all those things that, that prevent naturally the opportunity for theft or fraud. Now Matt, the, are these white labeled apps essentially where the company would have a white label app. So when I asked question because. Sorry, I shook my head. Yes. Everything's labeled Magnus. So when drivers are hauling and again, this is kind of in recognition of small fleets, right. And there's a small fleets that will haul for a number of our carriers. So it's a single app. They have different install codes and things like that that you are aware of who it is. But it makes it easier for the driver. So it is, it is a single app on the Magnus brand. Well, you may have answered the question that I'm about to ask. If you've been watching the show, we've been talking about the fact that there's a couple of weeks ago, this loop is superior case, which happened in the great state of Texas.

1:54:06Or at least jury was in Dallas County. And one of the interesting things we learned actually on this show was the one of the attorneys that was involved in the case told us that. The reason that that driver was declared a borrowed employee was because he had the C.H. Robinson app. Even though there was zero evidence, the driver had ever directly communicated to C.H. Robinson. The fact that he had his C.H. Robinson app that he was hauling the load was how the jury determined during that load, he was a borrowed employee. That was sort of my question as if it's a private label app. Is that, you know, in some ways, is that exposed your customer? But I think you answered it. Is that by having it as a Magnus app, it gives the at least the shipper and the broker some defensibility that they're not involved. Yeah, that's right. That's right. I mean, you know, I'm not an attorney, but we deal with that all the time, whether it's 10, 99 or gig worker for those kinds of things. Having the Magnus app is just a facilitation of the work and it becomes artifacts of the work. It does not assert control or agency.

1:55:10They have to do the force dispatch or those things that can become an agency consideration. So we're aware of it and have been aware of it. Again, going back to your night of road days, we had multiple times where with a large brokerage fleet, 10, 99 or independent contractor drivers that we've always been highly consider that and just naturally insulated against that as well. So, so I am curious, Julian, I was telling this earlier, we had some autonomous vehicle, yes, on today. But what is your view in terms of an autonomous world once one autonomous trucks hit us and we know how we know how emotional some of our audience could be about this topic. But once we have it, what is the world look like in terms of consolidation, do the asset carriers end up winning, do the larger brokers any thoughts there on what that world looks like? Yeah, you know, I think the timeline is not super short for that. So, so we're aware and I think anything that can improve the industry as a whole is worthwhile.

1:56:22It was certainly looking at where autonomous vehicles fit in. It's something that we're keen on and want to be mindful of. We actually build systems and have partnered with a couple of universities and other customers to help them on those initiatives. But I think that the timeline is a little bit longer to where it's not something that is super front of mine today. But I think there's there is a good opportunity for the participants in the industry, whether it's truckers or whether it's shippers to take advantage of those technology gains that come with the autonomous vehicles. I think there's, you know, the good side, the idea is in I think that most of the time people worry about job loss, but I think there's plenty of opportunity and efficiency to be gained that doesn't that. So the result in job loss from any sort of autonomous improvements, whether it's vehicles or anything system wise.

1:57:29Well, Matt really, I had the chance to go to Austin last week. I love love. I went to Baylor, which is up the street from the eyes and Waco and love going to Austin got to go back. I mean, I was there in the 90s and of course, I've been back to Austin a few different times. But just that city, like the skyline of Austin, it just it's absolutely fascinating. You didn't have a bypass when I was in college. There was no bypass to the Austin city. You would have to drive right through on I 35. Yeah, it's still it's still a little that way. But there's plans to fix it. But same thing the horizon is not immediate. But yeah, Austin's a great place. And the only thing is we got to figure out a term to temperature down a few degrees occasionally. But otherwise, I'll take it. Yeah. Now are you a UT fan, Matt? I am I am I went to the University of Arkansas. So talking about Pam transport. I have I have my connections there. And that's where I grew up. But I've been in Texas since 2000 or so.

1:58:30We're fan of Arkansas. The university has been kind to us. Well, hey, it's it's it's good. It's a lot of people who still look back at the Southwest Conference. I appreciate the throwback there. And you know, as a baler guy, we we really are angry with was some of the tech. And I was one of the first to sort of abandoned the old. I know, I know they they they got out now. I wonder if they're thinking, you know, I mean, but you know college football such an awesome awesome deal. And it's big business too. So that time of year and unfortunately it is a big business. And I'm not sure that's better at college football. Yeah, yeah. But anyways, we'll appreciate you coming on. We'll have to have you back. And sure thanks for your time. Tomorrow we get another great show.

1:59:34Julie, what do we got tomorrow? We do have my opinion on the. Yeah, we'll see if we'll talk about it. But yeah, we're going to talk about fraud and. I believe so. Yeah, I mean, he's office is right across the street. No really. I also have shipy arms Jason Murray and then Penny Allen. I guess both of them are going to be on. It sounds great. So anyways, we will be back tomorrow at noon. See you then. Maybe I'm wrong.