Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.
MercuryGate also partners with other freight brokers, but says the new arrangement adds extra capacity for its customers, according to MercuryGate’s vice president of product marketing, Kathryn Buchanan.
The additional capacity includes more than 40,000 Amazon-owned trailers and a network of third-party drivers to move shippers’ truckload freight. Shippers can use Amazon Freight to ship full truckloads inbound to Amazon, to their own facilities, or to their customer’s facilities, using 53-foot dry vans.
“Freight moves fast, and shippers need access to an efficient freight partner who can help them keep up with demand and streamline their processes,” MercuryGate President & CEO Joe Juliano said in a release. “This partnership will make it even easier for shippers of all sizes to access Amazon Freight’s advanced logistics network and premium service offering to move their full truckload freight.”
According to Buchanan, the partnership benefits both partners, since Amazon Freight can now tap in to MercuryGate’s pool of shippers in order to bring more paying freight into its trailers, while MercuryGate customers benefit from expanded capability and capacity.
One of those new capabilities is that the Seattle-based e-commerce giant will also extend its complimentary lane-match analysis to MercuryGate shippers. Under that arrangement, the company’s transportation specialists work with shippers to overlay their lanes on top of the Amazon Freight network and identify opportunities for shippers to save money and optimize their network, Amazon said.
“As Earth’s most customer-centric company, we’re always working on new ways to make shipping as simple and reliable as shopping on Amazon.com,” Amazon Freight’s vice president, Hannah McClellan, said in a release. “MercuryGate has a strong reputation for being a technological leader in the transportation space, with a feature-rich platform and a focus on usability. When searching for an inaugural TMS partner, their platform and software solutions were a natural fit with our values and service offering— adding one more way for us to meet shippers where they are to help optimize how they move freight.”
According to FedEx, the proposed breakup will create flexibility for the two companies to handle the separate demands of the global parcel and the LTL markets. That approach will enable FedEx and FedEx Freight to deploy more customized operational execution, along with more tailored investment and capital allocation strategies. At the same time, the two companies will continue to cooperate on commercial, operational, and technology initiatives.
Following the split, FedEx Freight will become the industry’s largest LTL carrier, with revenue of $9.4 billion in fiscal 2024. The company also boasts the broadest network and fastest transit times in its industry, the company said.
After spinning of that business, the remaining FedEx units will have a combined revenue of $78.3 billion based on fiscal year 2024 results for its range of time- and day-definite delivery and related supply chain technology services to more than 220 countries and territories through an integrated air-ground express network.
The move comes after FedEx has operated its freight unit for decades. After launching in 1971 as an overnight air courier service, FedEx grew quickly and in 1998 acquired Caliber System inc., creating a transportation “powerhouse” comprising the traditional FedEx distribution service and small-package ground carrier RPS, LTL carrier Viking Freight, Caliber Logistics, Caliber Technology, and Roberts Express. And in 2006, FedEx acquires Watkins Motor Lines, enhancing FedEx Freight’s ability to serve customers in the long-haul LTL freight market.
FedEx share prices rose after the announcement, as investors cheered a resolution to the debate that had lingered since June about whether the event would happen, according to a statement from Bascome Majors, a market analyst with Susquehanna Financial Group. And FedEx Freight will become a major player in the sector, based on its 16% share of industry revenue in 2023, well above Old Dominion Freight Lines (ODFL)’s 10% and SAIA’s 5%, he said.
Likewise, TD Cowen issued a “buy” rating for FedEx based on the long-awaited move, according to Jason Seidl, senior analyst focused on rail, trucking and logistics. That came as investors were soothed about their worries of potential “dis-synergies” from the split by the detail that FedEx Freight and legacy FDX have signed agreements that will continue the connectivity of the two networks.
There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.
Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”
Kent, who is a senior fellow at the George H. W. Bush Foundation for U.S.-China Relations, believes the photograph is a good reminder that some 50-odd years ago, the economies of the United States and China were not as tightly interwoven as they are today. At the time, the Nixon administration was looking to form closer political and economic ties between the two countries in hopes of reducing chances of future conflict (and to weaken alliances among Communist countries).
The signals coming out of Washington and Beijing are now, of course, much different than they were in the early 1970s. Instead of advocating for better relations, political rhetoric focuses on the need for the U.S. to “decouple” from China. Both Republicans and Democrats have warned that the U.S. economy is too dependent on goods manufactured in China. They see this dependency as a threat to economic strength, American jobs, supply chain resiliency, and national security.
Supply chain professionals, however, know that extricating ourselves from our reliance on Chinese manufacturing is easier said than done. Many pundits push for a “China + 1” strategy, where companies diversify their manufacturing and sourcing options beyond China. But in reality, that “plus one” is often a Chinese company operating in a different country or a non-Chinese manufacturer that is still heavily dependent on material or subcomponents made in China.
This is the problem when supply chain decisions are made on a global scale without input from supply chain professionals. In an article in the Arkansas Democrat-Gazette, Kent argues that, “The discussions on supply chains mainly take place between government officials who typically bring many other competing issues and agendas to the table. Corporate entities—the individuals and companies directly impacted by supply chains—tend to be under-represented in the conversation.”
Kent is a proponent of what he calls “supply chain diplomacy,” where experts from academia and industry from the U.S. and China work collaboratively to create better, more efficient global supply chains. Take, for example, the “Peace Beans” project that Kent is involved with. This project, jointly formed by Zhejiang University and the Bush China Foundation, proposes balancing supply chains by exporting soybeans from Arkansas to tofu producers in China’s Yunnan province, and, in return, importing coffee beans grown in Yunnan to coffee roasters in Arkansas. Kent believes the operation could even use the same transportation equipment.
The benefits of working collaboratively—instead of continuing to build friction in the supply chain through tariffs and adversarial relationships—are numerous, according to Kent and his colleagues. They believe it would be much better if the two major world economies worked together on issues like global inflation, climate change, and artificial intelligence.
And such relations could play a significant role in strengthening world peace, particularly in light of ongoing tensions over Taiwan. Because, as Kent writes, “The 19th-century idea that ‘When goods don’t cross borders, soldiers will’ is as true today as ever. Perhaps more so.”
Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.
That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.
As a part of the 2021 Infrastructure Investment and Jobs Act, the BABA Act aims to increase the use of American-made materials in federally funded infrastructure projects across the U.S., Hyster-Yale says. It was enacted as part of a broader effort to boost domestic manufacturing and economic growth, and mandates that federal dollars allocated to infrastructure – such as roads, bridges, ports and public transit systems – must prioritize materials produced in the USA, including critical items like steel, iron and various construction materials.
Hyster-Yale’s footprint in the U.S. is spread across 10 locations, including three manufacturing facilities.
“Our leadership is fully invested in meeting the needs of businesses that require BABA-compliant material handling solutions,” Tony Salgado, Hyster-Yale’s chief operating officer, said in a release. “We are working to partner with our key domestic suppliers, as well as identifying how best to leverage our own American manufacturing footprint to deliver a competitive solution for our customers and stakeholders. But beyond mere compliance, and in line with the many areas of our business where we are evolving to better support our customers, our commitment remains steadfast. We are dedicated to delivering industry-leading standards in design, durability and performance — qualities that have become synonymous with our brands worldwide and that our customers have come to rely on and expect.”
In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.
Both rules are intended to deliver health benefits to California citizens affected by vehicle pollution, according to the environmental group Earthjustice. If the state gets federal approval for the final steps to become law, the rules mean that cars on the road in California will largely be zero-emissions a generation from now in the 2050s, accounting for the average vehicle lifespan of vehicles with internal combustion engine (ICE) power sold before that 2035 date.
“This might read like checking a bureaucratic box, but EPA’s approval is a critical step forward in protecting our lungs from pollution and our wallets from the expenses of combustion fuels,” Paul Cort, director of Earthjustice’s Right To Zero campaign, said in a release. “The gradual shift in car sales to zero-emissions models will cut smog and household costs while growing California’s clean energy workforce. Cutting truck pollution will help clear our skies of smog. EPA should now approve the remaining authorization requests from California to allow the state to clean its air and protect its residents.”
However, the truck drivers' industry group Owner-Operator Independent Drivers Association (OOIDA) pushed back against the federal decision allowing the Omnibus Low-NOx rule to advance. "The Omnibus Low-NOx waiver for California calls into question the policymaking process under the Biden administration's EPA. Purposefully injecting uncertainty into a $588 billion American industry is bad for our economy and makes no meaningful progress towards purported environmental goals," (OOIDA) President Todd Spencer said in a release. "EPA's credibility outside of radical environmental circles would have been better served by working with regulated industries rather than ramming through last-minute special interest favors. We look forward to working with the Trump administration's EPA in good faith towards achievable environmental outcomes.”
Editor's note:This article was revised on December 18 to add reaction from OOIDA.
Global trade will see a moderate rebound in 2025, likely growing by 3.6% in volume terms, helped by companies restocking and households renewing purchases of durable goods while reducing spending on services, according to a forecast from trade credit insurer Allianz Trade.
The end of the year for 2024 will also likely be supported by companies rushing to ship goods in anticipation of the higher tariffs likely to be imposed by the coming Trump administration, and other potential disruptions in the coming quarters, the report said.
However, that tailwind for global trade will likely shift to a headwind once the effects of a renewed but contained trade war are felt from the second half of 2025 and in full in 2026. As a result, Allianz Trade has throttled back its predictions, saying that global trade in volume will grow by 2.8% in 2025 (reduced by 0.2 percentage points vs. its previous forecast) and 2.3% in 2026 (reduced by 0.5 percentage points).
The same logic applies to Allianz Trade’s forecast for export prices in U.S. dollars, which the firm has now revised downward to predict growth reaching 2.3% in 2025 (reduced by 1.7 percentage points) and 4.1% in 2026 (reduced by 0.8 percentage points).
In the meantime, the rush to frontload imports into the U.S. is giving freight carriers an early Christmas present. According to Allianz Trade, data released last week showed Chinese exports rising by a robust 6.7% y/y in November. And imports of some consumer goods that have been threatened with a likely 25% tariff under the new Trump administration have outperformed even more, growing by nearly 20% y/y on average between July and September.