RXO says the third quarter of 2025 isn’t looking much different than the first two quarters of the year. The logistics company’s The Curve report still sees “a muted demand picture leading to lower freight volumes, waning carrier capacity, and a prolonged stable rate environment (though they are increasing on a year-over-year basis).”
Cass Information Systems tracks every up and down in the freight market and every twist and turn with federal regulations. In this newsletter, we bring you some insight into the third quarter, as well as the English language proficiency crackdown, technological advancements in logistics and store-to-consumer deliveries, and advice to reduce driver turnover.
The trucking market in the third quarter is largely unchanged from Q2, according to the RXO report, which pointed to sluggish freight volumes, little difference between contract and spot rates, fewer Class 8 truck orders, and ongoing carrier job losses.
“The persistence of these low rates, both in contract and spot, is placing an immense amount of pressure on carriers,” The Curve report said. “If (and likely, when) enough carriers get driven out of the market, it will trigger a rise in spot rates, but the timeline for the flip keeps getting pushed out given weak conditions.”
The RXO report said spot rates rose 6.5% year over year in Q2, down from the 9.1% year-over-year gain in the first quarter. Contract rates edged up just 1.1% in Q2 and 1.4% in Q1.
“Though we are in an inflationary rate environment, Q2 was still primarily a shippers’ market,” it said.
Ken Adamo, DAT’s chief of analytics, hasn’t seen major changes in the truckload market either. “There are carriers with low-cost structures and steady customers that are negotiating better contracts, but in general, there’s a feeling that volumes and rates are stuck. Barring some major event, there’s nothing to suggest that’s going to change anytime soon.”
The U.S. Department of Transportation (DOT) is threatening to withhold tens of millions of dollars in federal funding from three states — California, New Mexico, and Washington — if they do not enforce the English language proficiency requirement for commercial truck drivers.
“We don’t want to take away money from states, but we will take money away, and we’ll take additional steps that get progressively more difficult for these states,” DOT Secretary Sean Duffy said in a late-August announcement, giving the states 30 days to enforce the regulation requiring English proficiency for truck drivers.
Trucking Dive reported that a DOT investigation following an August 12 deadly crash in Florida involving a tractor-trailer driven by Harjinder Singh, who reportedly entered the country illegally, determined that the three states had violated federal standards. Both California and Washington had issued a CDL to Singh, who Duffy said couldn’t speak English or understand road signs. There also was no evidence that the driver had been administered an English language proficiency assessment when he was issued a speeding ticket in New Mexico.
“If states had followed the rules, this driver would never have been behind the wheel and three precious lives would still be with us,” Duffy said.
Florida Attorney General James Uthmeier has issued civil and criminal subpoenas to Singh’s employer, White Hawk Carriers. Uthmeier said Singh never should have been issued a CDL.
“Not only was he illegally here in the country, but he also did not have the competency, the skill set. There’s no way he went through the proper training in order to get this license.”
The Federal Motor Carrier Safety Administration (FMCSA) will begin collecting data aimed at identifying key driver, vehicle, motor carrier, and environmental factors that may contribute to fatal crashes involving heavy-duty trucks.
A formal study into the causes of fatal heavy-duty truck crashes was mandated in the 2021 Infrastructure Investment & Jobs Act (IIJA). The FMCSA established the Crash Causal Factors Program (CCFP), through which it is “pursuing a nuanced understanding of crashes involving CMVs so that policymakers, law enforcement agencies, regulators, and other interested parties can implement effective crash prevention strategies and programs.”
The FMCSA said the CCFP is part of a heightened effort to address the rising number of fatal crashes and reduce roadway fatalities.
The Commercial Carrier Journal reported that after the data collection phase is complete, the data will be analyzed to identify crash trends and inform the development of effective, targeted safety policies and programs to help prevent crashes.
An unannounced Commercial Vehicle Safety Alliance (CVSA) inspection of commercial motor vehicles transporting hazardous materials or dangerous goods (HM/DG) netted nearly 600 out-of-service violations.
Over five days this summer, 4,629 vehicles were inspected in Canada and the United States. Inspectors reportedly found 1,169 HM/DG violations, of which 51% — 598 — were serious enough for the vehicles to be placed out of service. Twenty of those out-of-service notices were for package integrity — leaking — violations. The CVSA noted that leaking hazardous materials or dangerous goods pose a significant threat to human health and safety, property, and the environment.
Ten Canadian provinces and 35 U.S. states participated in the inspection blitz.
Werner Enterprises is touting its technological advances for its logistics growth, and it’s continuing to build out its transportation management system, EDGE TMS, so all of its loads are visible on that platform.
Werner launched its EDGE TMS in 2021. CEO Derek Leathers said on a Q2 earnings call that nearly two-thirds of its one-way truckload volumes and more than half of its dedicated volumes already are on the platform.
Leathers said Werner’s logistics segment has largely been on the TMS for several quarters, resulting in a 20% productivity improvement in brokerage loads per employee.
“We remain focused on providing superior and diversified solutions to our customers by investing in our future through technology and structurally improving our business with a commitment to delivering value,” Leathers said.
Leonard’s Express said it’s been able to reduce driver turnover by 15%, largely through regular engagement calls, which begin two to three weeks after orientation.
“Most of the turnover comes in the first six months,” Executive Chairman Ken Johnson said. “While sometimes it’s because it truly isn’t a good fit, a lot of times, it’s feeling lost and not knowing where to get the answers from. So, we thought this was a good way to bridge that gap.”
New York-based Leonard’s Express operates 615 trucks out of facilities in Delaware, North Carolina, and Wisconsin.
The calls give drivers the opportunity to share feedback about company practices, industry trends, and potential improvements with Leonard’s Express operations team members, department heads, and senior leadership.
Marten Transport’s current CEO is stepping down, and a former leader is returning to the helm.
CEO Timothy Kohl is retiring September 30. Executive Chairman Randolph Marten will again assume the CEO title on October 1.
Marten previously was CEO from January 2005 to May 2021. With the company since 1974, he also has served as director, chief operating officer, vice president, and president. Kohl joined the company in 2007 and served as president before being named CEO.
Trucking Dive said the leadership changes “coincide with reports the company is continuing to face pressure from oversupply and weak demand caused by the ongoing freight market recession. The company also recently entered into a deal to sell its reefer intermodal offerings to Hub Group.”
Marten’s Q2 earnings release said the company is focused on “minimizing the freight market’s impact — and the impact of the U.S. and global economies with the current trade policy volatility — while investing in and positioning our operations to capitalize on profitable organic growth opportunities.”
Walmart’s Store-Fulfilled Delivery Sales Jump 50%
Walmart reported its U.S. store-filled delivery sales jumped nearly 50% in the second quarter amid its push to accelerate shipping speeds.
Walmart EVP and CFO John David Rainey said on an earnings call in late August that about one-third of deliveries from stores in recent weeks arrived in three hours or less, with 20% of them arriving in half an hour or less.
Rainey said fast deliveries result in more frequent orders. “As [shoppers] realize that they can get those things that they want and need right away, we see that repeat purchasing behavior, which makes the share gains that we have very sticky,” he said.
Walmart also is using technology to strengthen the consumer delivery experience. Supply Chain Dive said that “tapping more into artificial intelligence could help the company boost the accuracy of its ‘dynamic delivery windows,’ which it will offer to 95% of U.S. households by the end of the year. Walmart’s dynamic delivery algorithm analyzes local conditions to determine the most efficient driver routes and the estimated time of arrival for an order.”
Colgate-Palmolive Earmarks $300M to Optimize Supply Chain
Colgate-Palmolive plans to spend up to $300 million to optimize its global supply chain as part of a three-year productivity program.
Like many manufacturers, Colgate-Palmolive is leveraging its supply chain as a source for higher productivity, lower costs, and operational efficiency, according to Supply Chain Dive.
“Colgate-Palmolive is dealing with volatile and rising costs due to tariff increases, higher raw and packaging material costs, and lower category inflation, which leaves less room to raise retail prices in response to rising costs in other parts of the business,” CEO Noel Wallace said on a second-quarter earnings call.
According to Supply Chain Dive, Colgate-Palmolive’s supply chain has also had to respond quickly to demand changes fueled by consumer uncertainty. That includes adjusting to consumer preferences when they shift between more expensive product multipacks and less expensive single packs or smaller sizes.
“We can then leverage our global supply chain’s breadth, resiliency, and agility to respond to these changes in consumer preference,” Wallace said.
The trucking market will rebound, it’s just a matter of when. When it does, Cass will be there for carriers. Cass Commercial Bank Equipment Financing finances trucks, trailers, and equipment. Contact Scott Williams, Vice President Commercial Equipment Finance, at (513) 545-4605 or swilliams@cassbank.com to learn more.
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