The Senate Commerce Committee late yesterday approved a six-year reauthorization of the nation's transportation funding programs that, when combined with another Senate bill, auger potentially significant changes to the freight sector.
The "Comprehensive Transportation and Consumer Protection Act of 2015," passed by a 13-11 margin, requires the Federal Motor Carrier Safety Administration (FMCSA) to commission a study by the Transportation Research Board of the FMCSA's controversial Compliance, Safety, and Accountability (CSA) program that grades carriers based on a series of metrics and assigns them safety scores. The bill requires FMCSA to remove Safety Measurement System (SMS) data from public viewing until the Research Board publishes its report, and recommendations from a corrective action plan have been implemented.
The measure, if it survives the full legislative process, would be a victory for the American Trucking Associations, which has long urged FMCSA to remove SMS scores from public view because they don't effectively identify high-risk carriers and they rely on a limited amount of data. ATA has called on FMCSA to revise the SMS methodology to account for the limited amount of available information.
The bill also authorizes the Secretary of Transportation to launch a six-year pilot program to allow states to enter into reciprocal agreements authorizing licensed drivers between 18 and 21 to operate on interstate highways. Under current law, a driver cannot operate a commercial motor vehicle in interstate commerce until the age of 21. However, drivers between 18 and 21 can operate within the borders of the state where they are licensed. Trucking interests, which face a worsening driver shortage, say it makes no sense that a driver can operate 500 miles within California but not be allowed to drive 50 miles to and from any of the states that border it.
In addition, the bill gives trucking companies permission to use hair follicles rather than urinalysis for employee substance-abuse testing. Hair testing detects an individual's drug use for a period going back months before the test, while urine testing, the only pre-employment driver screen allowed by law, only detects drug use for a few days back and can be easily subverted by an applicant.
The bill will advance to the Senate floor along with legislation known as the "Drive
Act," which was passed late last month by the Senate Environment and Public Works Committee. The six-year, $278 billion reauthorization measure includes a minimum annual investment of $2 billion in funding for freight infrastructure, capping out at $13.5 billion at the end of the six-year period. It also calls for a freight-focused competitive grant program and state-level freight planning with public- and private-sector involvement.
The two bills, along with assorted bills that have already been advanced, will coalesce into what is popularly known as the "Highway Bill," which is the legislation that establishes guidelines for reauthorizing transport programs. The legislation doesn't determine how those programs will be paid for.
Artificial intelligence (AI) and data science were hot business topics in 2024 and will remain on the front burner in 2025, according to recent research published in AI in Action, a series of technology-focused columns in the MIT Sloan Management Review.
In Five Trends in AI and Data Science for 2025, researchers Tom Davenport and Randy Bean outline ways in which AI and our data-driven culture will continue to shape the business landscape in the coming year. The information comes from a range of recent AI-focused research projects, including the 2025 AI & Data Leadership Executive Benchmark Survey, an annual survey of data, analytics, and AI executives conducted by Bean’s educational firm, Data & AI Leadership Exchange.
The five trends range from the promise of agentic AI to the struggle over which C-suite role should oversee data and AI responsibilities. At a glance, they reveal that:
Leaders will grapple with both the promise and hype around agentic AI. Agentic AI—which handles tasks independently—is on the rise, in the form of generative AI bots that can perform some content-creation tasks. But the authors say it will be a while before such tools can handle major tasks—like make a travel reservation or conduct a banking transaction.
The time has come to measure results from generative AI experiments. The authors say very few companies are carefully measuring productivity gains from AI projects—particularly when it comes to figuring out what their knowledge-based workers are doing with the freed-up time those projects provide. Doing so is vital to profiting from AI investments.
The reality about data-driven culture sets in. The authors found that 92% of survey respondents feel that cultural and change management challenges are the primary barriers to becoming data- and AI-driven—indicating that the shift to AI is about much more than just the technology.
Unstructured data is important again. The ability to apply Generative AI tools to manage unstructured data—such as text, images, and video—is putting a renewed focus on getting all that data into shape, which takes a whole lot of human effort. As the authors explain “organizations need to pick the best examples of each document type, tag or graph the content, and get it loaded into the system.” And many companies simply aren’t there yet.
Who should run data and AI? Expect continued struggle. Should these roles be concentrated on the business or tech side of the organization? Opinions differ, and as the roles themselves continue to evolve, the authors say companies should expect to continue to wrestle with responsibilities and reporting structures.
Shippers today are praising an 11th-hour contract agreement that has averted the threat of a strike by dockworkers at East and Gulf coast ports that could have frozen container imports and exports as soon as January 16.
The agreement came late last night between the International Longshoremen’s Association (ILA) representing some 45,000 workers and the United States Maritime Alliance (USMX) that includes the operators of port facilities up and down the coast.
Details of the new agreement on those issues have not yet been made public, but in the meantime, retailers and manufacturers are heaving sighs of relief that trade flows will continue.
“Providing certainty with a new contract and avoiding further disruptions is paramount to ensure retail goods arrive in a timely manner for consumers. The agreement will also pave the way for much-needed modernization efforts, which are essential for future growth at these ports and the overall resiliency of our nation’s supply chain,” Gold said.
The next step in the process is for both sides to ratify the tentative agreement, so negotiators have agreed to keep those details private in the meantime, according to identical statements released by the ILA and the USMX. In their joint statement, the groups called the six-year deal a “win-win,” saying: “This agreement protects current ILA jobs and establishes a framework for implementing technologies that will create more jobs while modernizing East and Gulf coasts ports – making them safer and more efficient, and creating the capacity they need to keep our supply chains strong. This is a win-win agreement that creates ILA jobs, supports American consumers and businesses, and keeps the American economy the key hub of the global marketplace.”
The breakthrough hints at broader supply chain trends, which will focus on the tension between operational efficiency and workforce job protection, not just at ports but across other sectors as well, according to a statement from Judah Levine, head of research at Freightos, a freight booking and payment platform. Port automation was the major sticking point leading up to this agreement, as the USMX pushed for technologies to make ports more efficient, while the ILA opposed automation or semi-automation that could threaten jobs.
"This is a six-year détente in the tech-versus-labor tug-of-war at U.S. ports," Levine said. “Automation remains a lightning rod—and likely one we’ll see in other industries—but this deal suggests a cautious path forward."
Editor's note: This story was revised on January 9 to include additional input from the ILA, USMX, and Freightos.
Logistics industry growth slowed in December due to a seasonal wind-down of inventory and following one of the busiest holiday shopping seasons on record, according to the latest Logistics Managers’ Index (LMI) report, released this week.
The monthly LMI was 57.3 in December, down more than a percentage point from November’s reading of 58.4. Despite the slowdown, economic activity across the industry continued to expand, as an LMI reading above 50 indicates growth and a reading below 50 indicates contraction.
The LMI researchers said the monthly conditions were largely due to seasonal drawdowns in inventory levels—and the associated costs of holding them—at the retail level. The LMI’s Inventory Levels index registered 50, falling from 56.1 in November. That reduction also affected warehousing capacity, which slowed but remained in expansion mode: The LMI’s warehousing capacity index fell 7 points to a reading of 61.6.
December’s results reflect a continued trend toward more typical industry growth patterns following recent years of volatility—and they point to a successful peak holiday season as well.
“Retailers were clearly correct in their bet to stock [up] on goods ahead of the holiday season,” the LMI researchers wrote in their monthly report. “Holiday sales from November until Christmas Eve were up 3.8% year-over-year according to Mastercard. This was largely driven by a 6.7% increase in e-commerce sales, although in-person spending was up 2.9% as well.”
And those results came during a compressed peak shopping cycle.
“The increase in spending came despite the shorter holiday season due to the late Thanksgiving,” the researchers also wrote, citing National Retail Federation (NRF) estimates that U.S. shoppers spent just short of a trillion dollars in November and December, making it the busiest holiday season of all time.
The LMI is a monthly survey of logistics managers from across the country. It tracks industry growth overall and across eight areas: inventory levels and costs; warehousing capacity, utilization, and prices; and transportation capacity, utilization, and prices. The report is released monthly by researchers from Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, in conjunction with the Council of Supply Chain Management Professionals (CSCMP).
The overall national industrial real estate vacancy rate edged higher in the fourth quarter, although it still remains well below pre-pandemic levels, according to an analysis by Cushman & Wakefield.
Vacancy rates shrunk during the pandemic to historically low levels as e-commerce sales—and demand for warehouse space—boomed in response to massive numbers of people working and living from home. That frantic pace is now cooling off but real estate demand remains elevated from a long-term perspective.
“We've witnessed an uptick among firms looking to lease larger buildings to support their omnichannel fulfillment strategies and maintain inventory for their e-commerce, wholesale, and retail stock. This trend is not just about space, but about efficiency and customer satisfaction,” Jason Tolliver, President, Logistics & Industrial Services, said in a release. “Meanwhile, we're also seeing a flurry of activity to support forward-deployed stock models, a strategy that keeps products closer to the market they serve and where customers order them, promising quicker deliveries and happier customers.“
The latest figures show that industrial vacancy is likely nearing its peak for this cooling cycle in the coming quarters, Cushman & Wakefield analysts said.
Compared to the third quarter, the vacancy rate climbed 20 basis points to 6.7%, but that level was still 30 basis points below the 10-year, pre-pandemic average. Likewise, overall net absorption in the fourth quarter—a term for the amount of newly developed property leased by clients—measured 36.8 million square feet, up from the 33.3 million square feet recorded in the third quarter, but down 20% on a year-over-year basis.
In step with those statistics, real estate developers slowed their plans to erect more buildings. New construction deliveries continued to decelerate for the second straight quarter. Just 85.3 million square feet of new industrial product was completed in the fourth quarter, down 8% quarter-over-quarter and 48% versus one year ago.
Likewise, only four geographic markets saw more than 20 million square feet of completions year-to-date, compared to 10 markets in 2023. Meanwhile, as construction starts remained tempered overall, the under-development pipeline has continued to thin out, dropping by 36% annually to its lowest level (290.5 million square feet) since the third quarter of 2018.
Despite the dip in demand last quarter, the market for industrial space remains relatively healthy, Cushman & Wakefield said.
“After a year of hesitancy, logistics is entering a new, sustained growth phase,” Tolliver said. “Corporate capital is being deployed to optimize supply chains, diversify networks, and minimize potential risks. What's particularly encouraging is the proactive approach of retailers, wholesalers, and 3PLs, who are not just reacting to the market, but shaping it. 2025 will be a year characterized by this bias for action.”
The three companies say the deal will allow clients to both define ideal set-ups for new warehouses and to continuously enhance existing facilities with Mega, an Nvidia Omniverse blueprint for large-scale industrial digital twins. The strategy includes a digital twin powered by physical AI – AI models that embody principles and qualities of the physical world – to improve the performance of intelligent warehouses that operate with automated forklifts, smart cameras and automation and robotics solutions.
The partners’ approach will take advantage of digital twins to plan warehouses and train robots, they said. “Future warehouses will function like massive autonomous robots, orchestrating fleets of robots within them,” Jensen Huang, founder and CEO of Nvidia, said in a release. “By integrating Omniverse and Mega into their solutions, Kion and Accenture can dramatically accelerate the development of industrial AI and autonomy for the world’s distribution and logistics ecosystem.”
Kion said it will use Nvidia’s technology to provide digital twins of warehouses that allows facility operators to design the most efficient and safe warehouse configuration without interrupting operations for testing. That includes optimizing the number of robots, workers, and automation equipment. The digital twin provides a testing ground for all aspects of warehouse operations, including facility layouts, the behavior of robot fleets, and the optimal number of workers and intelligent vehicles, the company said.
In that approach, the digital twin doesn’t stop at simulating and testing configurations, but it also trains the warehouse robots to handle changing conditions such as demand, inventory fluctuation, and layout changes. Integrated with Kion’s warehouse management software (WMS), the digital twin assigns tasks like moving goods from buffer zones to storage locations to virtual robots. And powered by advanced AI, the virtual robots plan, execute, and refine these tasks in a continuous loop, simulating and ultimately optimizing real-world operations with infinite scenarios, Kion said.