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Speaker 1: Hi everyone, and welcome to Bloomberg Intelligence Talking Transport Podcast.

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Speaker 1: I'm your host, Lee Klaskow, Senior Freight transportation logistics Analysts

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Speaker 1: at Bloomberg Intelligence, Bloomberg's in house research arm of almost

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Speaker 1: five hundred analysts and strategists. Before diving in a little

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Speaker 1: public service announcement, your support is instrumental to keep bringing

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Speaker 1: great guests onto the podcast like the one we have today.

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Speaker 1: If you haven't already, please do take a moment to

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Speaker 1: follow rate and share the Talking Transports podcasts with your

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Speaker 1: friends and family. We appreciate your support. I'm very excited

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Speaker 1: to have today with us. Craig Fuller the CEO and

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Speaker 1: founder of Freight Waves and is also the CEO of

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Speaker 1: fire Crown. Prior to founding Freight Waves, Craig was the

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Speaker 1: founder and CEO of TransCard, a fleet payment processor that

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Speaker 1: was sold to US Bank. He's also a trucking industry veteran,

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Speaker 1: having founded and managed the Express Direct division of ux

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Speaker 1: Express Enterprise. It's a Bachelor of Business Administration with a

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Speaker 1: focus on entrepreneurialship from Baylor University. So go Bears, Craig,

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Speaker 1: sick them bears, So welcome to the podcast. Thanks so

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Speaker 1: much for joining Lee.

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Speaker 2: Thanks for having me honored to be here.

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Speaker 1: So you have multiple You're wearing a hat right now,

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Speaker 1: and I know you wear multiple hats in your profession

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Speaker 1: and in your in your jobs. So you're CEO of

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Speaker 1: two companies. Can you just give us a brief breakdown

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Speaker 1: of of what freight Waves is and you know what

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Speaker 1: what fire Crown is as well.

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Speaker 3: Yeah, So freight Waves is, you know, we provide high

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Speaker 3: frequency data to global freight markets. You know what what

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Speaker 3: Bloomberg does in the finance part of the economy, we

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Speaker 3: aspire to do in the physical goods economy. So tracking

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Speaker 3: the movement of cargo around the world and all of

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Speaker 3: the sort of balances apply and demand and what goes

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Speaker 3: on into into the freight market. And then we have

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Speaker 3: an editorial team that provides context and news related to

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Speaker 3: things that are going on in freight. So really looking

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Speaker 3: at freight is a commodity and understanding the supply and

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Speaker 3: demand balance of freight and how freight moves and then

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Speaker 3: all the stories that drive the economic developments.

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Speaker 2: In the market.

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Speaker 1: All right, and the fire Crown that is all the

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Speaker 1: media properties in one company, Is that correct?

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Speaker 2: Yeah?

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Speaker 3: So fire Crown is started out as a passion project

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Speaker 3: three years ago.

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Speaker 2: I'm a pilot.

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Speaker 3: I'm a recreational pilot and fly for fun and had

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Speaker 3: the opportunity to buy Flying Magazine, which is a magazine

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Speaker 3: that I grew up.

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Speaker 2: Reading as a pilot, and bought it and acquired it.

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Speaker 3: And you know, as an entrepreneur, I can't help myself

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Speaker 3: but to think there's more other things that you can

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Speaker 3: do in business, and so decided to buy more magazines.

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Speaker 2: I think we bought fifty at this point, so.

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Speaker 3: We're we buy lifestyle Enthusiast magazine, so in aviation marines

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Speaker 3: like boats and selling, selling and yachting. And then we

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Speaker 3: also bought some railroad titles that are in the hobbyist

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Speaker 3: community as well as Astronomy magazine, So about fifty different titles,

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Speaker 3: many of them legacy magazine brands, and then we're digitizing them.

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Speaker 3: And then we also have some commerce businesses like e

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Speaker 3: commerce and some aircraft finance businesses we own Fantastic.

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Speaker 1: So let's talk about freight, because that's why people are

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Speaker 1: tuned in. So, you know, you mentioned you provide data

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Speaker 1: for the freight markets. Could you talk about what that

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Speaker 1: data is telling you right now of where the freight

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Speaker 1: markets are today and where might they be heading?

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Speaker 3: Yeah, Lee, this is such an interesting time in freight.

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Speaker 3: I mean, I think all times are interesting in freight.

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Speaker 3: Maybe the twenty eleven to twenty fourteen market wasn't as

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Speaker 3: interesting because that was the market was sort of up

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Speaker 3: into the right and not a whole lot was happening

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Speaker 3: from a volatility standpoint. But since you know, I found

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Speaker 3: a freightways in twenty sixteen, the business has been incredibly volatile.

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Speaker 2: And I think right now what.

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Speaker 3: We're looking at is we've seen the market in a

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Speaker 3: protracted freight recession. For you know, we sort of look

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Speaker 3: at the freight recession as starting in Q sort of

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Speaker 3: the end of Q one twenty twenty two, to where

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Speaker 3: we're at today, which is, you know, August of twenty

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Speaker 3: twenty four, you're two and a half years into this

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Speaker 3: freight recession. It has been an enormously challenging time. But

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Speaker 3: we think that the market is certainly bottomed and is

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Speaker 3: slowly but recovering. And so that's sort of our thesis

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Speaker 3: right now is volumes have actually stay pretty steady through that.

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Speaker 3: We saw it initial collapsed in volumes in twenty two.

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Speaker 3: We saw the market throughout twenty three continue to get

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Speaker 3: better in terms of a volume standpoint, and in twenty

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Speaker 3: four has continued to be steady, no big breakouts in volumes.

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Speaker 3: But really what's overhanging the trucking market specifically is this

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Speaker 3: excess capacity that was built during.

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Speaker 1: COVID, right, And when you say a freight recession, are

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Speaker 1: you talking about lower volumes, lower revenue, lower rates, or

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Speaker 1: lower everything.

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Speaker 2: So this is.

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Speaker 3: The we get into these debates often in the industries,

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Speaker 3: what is a freight recession because on the volume standpoint,

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Speaker 3: it actually isn't that bad. And that's the part that's

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Speaker 3: surprising a lot of the carriers is that they experience

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Speaker 3: in their own business, and the assumption is that the

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Speaker 3: economy must be really dire and volumes are really dire.

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Speaker 3: But we can look from the GDP data data that's

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Speaker 3: completely outside of our own and actually recognize that the

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Speaker 3: economy has actually done pretty well for the last couple

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Speaker 3: of years.

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Speaker 2: But the freight market has seen something completely different. And

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Speaker 2: so what we.

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Speaker 3: Abscribe to a lot of the negative conditions of the

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Speaker 3: freight recession is really the balance and supply and demand.

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Speaker 3: So freight, like every other commodity in the planet operates

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Speaker 3: on a balance to supply and demand, and so you

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Speaker 3: can actually have pretty strong volumes but have a situation

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Speaker 3: that's pretty soft for the motor carriers that are in

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Speaker 3: the market. And what we look at to sort of

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Speaker 3: determine the freight recession is really two things.

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Speaker 2: One is rate.

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Speaker 3: You have spot rates that have collapsed, you have soft

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Speaker 3: you have declining contract rates, and you have tender rejection

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Speaker 3: that have also collapsed.

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Speaker 2: And so when we.

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Speaker 3: Look at the market, that's how we would abscribe a

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Speaker 3: freight recession.

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Speaker 1: So let me ask you a question, because you know

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Speaker 1: everyone loves to listen to this podcast. When you say

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Speaker 1: tender rejections, what are you talking about?

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Speaker 3: So tender rejections is an index that we developed to

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Speaker 3: really measure the percentage of truckloads that are rejected. So

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Speaker 3: think of this and I use the analogy of like airlines.

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Speaker 3: So ultimately, trucking companies want to book overbook their trucks

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Speaker 3: because there's always this situation where throughout an annual cycle

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Speaker 3: or different lanes is they will not have enough loads

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Speaker 3: to fill those trucks. So they have a bias in

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Speaker 3: a capacity to constrain market of trying to overfill those

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Speaker 3: trucks at oftentimes the loads that they're tendered, the loads

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Speaker 3: that are sent from shippers, they have the opportunity to

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Speaker 3: accept reject, usually about two days before that load is

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Speaker 3: set to pick up, and that rejection is basically a

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Speaker 3: signal back to the shipper that they had better things

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Speaker 3: to do.

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Speaker 2: With they have better options.

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Speaker 3: It's an optionality play for them, and what they're doing

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Speaker 3: is they're saying, I am not going to allocate a truck.

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Speaker 2: To this load.

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Speaker 3: And the reasons that they would do that is because

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Speaker 3: they found a higher paying load, perhaps a more important

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Speaker 3: customer to them is asked for those trucks, or they

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Speaker 3: decided that that you know, they had a breakdown, or

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Speaker 3: the driver decided he didn't want to take that load.

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Speaker 3: There's lots of reasons of why a trucking company would

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Speaker 3: reject the transaction, but most of the times it's just

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Speaker 3: because they have better options to do with their capacity.

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Speaker 3: And in that scenario, what we're measuring, so we have

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Speaker 3: this thing it's zero to one hundred percent, and it's

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Speaker 3: looking at the total percent of truckload transactions that we

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Speaker 3: measure in the contracted market, and these are transactions that

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Speaker 3: go from shippers to carriers. To be very clear, this

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Speaker 3: is not going from brokers. It's not stuff that's booked

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Speaker 3: over loadboards. It's actual EDI and API transactions from shippers

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Speaker 3: to carriers, and it's measuring the percent of those transactions

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Speaker 3: that were rejected. When we started measuring this data, we

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Speaker 3: were in about eighteen percent.

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Speaker 2: This was twenty and seventeen. We got as high to

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Speaker 2: about twenty.

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Speaker 3: Six percent in twenty eighteen, and then we got in

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Speaker 3: the sort of mid single digits four to five percent

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Speaker 3: back in twenty and nineteen in that freight recession, and

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Speaker 3: things got you know, when we saw the COVID recovery,

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Speaker 3: We're as high as thirty percent. So that means thirty

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Speaker 3: percent of all truckload contracted transactions that we were measuring

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Speaker 3: were rejected. And last year sort of what we would

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Speaker 3: call the absolute bottom of the freight market, in May

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Speaker 3: of twenty twenty three, we were about two point five percent.

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Speaker 3: Today we're sitting about four point six percent of trucklouds

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Speaker 3: being rejected, which is not a great sort of look historical.

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Speaker 2: We've had this data since twenty seventeen.

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Speaker 3: It's not a great number, but it's certainly better than

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Speaker 3: two and a half percent, and we have not seen

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Speaker 3: the two and a half percent since May of last year,

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Speaker 3: so we think that the freight market is certainly has

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Speaker 3: completed its We'll say that it has completed its bottoming process,

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Speaker 3: but it's a it's recovering, but very very slowly.

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Speaker 1: And we hear the word equilibrium thrown around a lot

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Speaker 1: when talking about trucking. So is there a percentage where

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Speaker 1: you view the market at equilibrium?

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Speaker 2: It's a great question.

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Speaker 3: I tend to not get caught up in the actual

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Speaker 3: number itself.

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Speaker 2: I get caught up in the momentum.

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Speaker 1: Gotcha.

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Speaker 3: You know when I when I started Freight Waves, a

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Speaker 3: lot of it was based on sort of this technical

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Speaker 3: analysis trading that some traders sort of ascribe to, is

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Speaker 3: the idea that you could look at a chart and

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Speaker 3: sort of tell a commodity or tell a you know,

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Speaker 3: a crypto or a stock. And what I was setting

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Speaker 3: out to do is really provide some way to visualize

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Speaker 3: the freight market in sort of a real time sort

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Speaker 3: of nature of it. And so what I'm looking at

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Speaker 3: is the direction of the chart versus the actual number.

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Speaker 3: And I can tell you four and a half percent

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Speaker 3: historically is not a great number, but when we compare

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Speaker 3: to where it was, you know, a year ago in

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Speaker 3: the mid two.

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Speaker 2: It's a great number.

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Speaker 3: Now if we look at where we were in July,

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Speaker 3: you know, in June we finished out about right before

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Speaker 3: July fourth about five point eight percent.

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Speaker 2: It was actually teasing to six percent. So July's, July

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Speaker 2: and early August have.

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Speaker 3: Been pretty soft. I mean, where we're at right now

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Speaker 3: is pretty soft. And you can hear this in some

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Speaker 3: of the anxiety and some of the earnings reports. Is

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Speaker 3: you'll hear a lot of the carriers talk about how

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Speaker 3: strong or relatively strong the second quarter was, or they

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Speaker 3: thought that things were improving, and July has been a disappointment.

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Speaker 2: Our data we could also substantiate that.

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Speaker 3: But but everyone who's been in freight for a while

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Speaker 3: knows that July is always a pretty abysmal month. It's

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Speaker 3: the arguably the second worst month of the year, and

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Speaker 3: so it's not surprising that this July would also repeat that.

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Speaker 3: And so we expect that that number, as well as

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Speaker 3: the other fundamentals of the market, will continue to improve

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Speaker 3: the rest of the year.

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Speaker 1: So what's the worst month of the year for truckers.

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Speaker 2: February is always the most abysmal month.

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Speaker 3: It used to be januaryly, but like, what's been weird

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Speaker 3: about January is it really started maybe even twenty years ago.

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Speaker 3: But you know, I've been around this business my whole life.

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Speaker 3: I grew up in it, and I remember my father,

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Speaker 3: who ran a large trucking company, would always complain about

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Speaker 3: January just being abysmal because right after the holidays, nobody

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Speaker 3: was shipping anything.

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Speaker 2: That's largely changed.

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Speaker 3: I think that first couple of weeks of January is

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Speaker 3: actually pretty strong because you have gift card season that

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Speaker 3: sort of takes place. Retailers are buying a lot of inventory,

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Speaker 3: stock out and also liquidating what they didn't cell during

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Speaker 3: the holidays, so you have this weird sort of development

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Speaker 3: in early January. In fact, we've had situations over the

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Speaker 3: last two years where we have been pretty confident into

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Speaker 3: the second third week of January that things were improving,

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Speaker 3: the frame market was coming back. We're like, hey, this

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Speaker 3: feels like the bottom, and we got caught in both years.

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Speaker 3: And so January has been a year that has been

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Speaker 3: a month that is that is quite different than it

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Speaker 3: historically is operated, at least in my tenure and freight

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Speaker 3: whereas February just it's a pretty bad month.

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Speaker 2: The weather is usually bad.

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Speaker 3: You have a lot of It's funny because a lot

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Speaker 3: of trucking companies it feels like anytime they miss their numbers,

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Speaker 3: they blame the weather. This is sort of the running

250
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Speaker 3: joke among public trucking companies. February is usually that first

251
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Speaker 3: quarter is usually one that catches them by surprise, and

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Speaker 3: it's that February month where you tend to.

253
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Speaker 2: Have the really miserable blizzards that.

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Speaker 3: Shut down the market, and then you really don't have

255
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Speaker 3: a lot of sort of seasonal activity that's happened in February.

256
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Speaker 3: You've sort of closed out your fourth quarter merchandise and

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Speaker 3: your peak merchandise.

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Speaker 2: You liquidate what you have.

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Speaker 3: They're not really rebuilding their stop at least retailers aren't

260
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Speaker 3: rebuilding their inventory until you know, early to mid March,

261
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Speaker 3: where they start thinking about spring season and summer. There's

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Speaker 3: summer lines, and so that's really why February is kind

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Speaker 3: of an ugly month. Construction's pretty much down. It just

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Speaker 3: feels like the world's kind of frozen in February.

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Speaker 1: Yeah, all right, so you know, for equilibrium, I guess

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Speaker 1: to get better. It seems from our perspective that it's

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Speaker 1: really more about the supply side than the demand side.

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Speaker 1: As you mentioned, demand's not terrible. Why has supply been

269
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Speaker 1: so slow to come out of the market this time around?

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Speaker 1: Why are things different? Do you think this.

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Speaker 3: Has been a question that everyone has been asking for

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Speaker 3: the last couple of years, and we've all had these

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Speaker 3: thesises of why, and so there's a lot of reasons

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Speaker 3: for it.

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Speaker 2: Brokerages have proliferated the market.

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Speaker 3: If you go back to the year two thousand, brokerage

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Speaker 3: is a percent of all freight represented six percent of

278
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Speaker 3: a frate. This is Armstrong and Associates data, So six

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00:13:28,120 --> 00:13:30,120
Speaker 3: percent of the freight market or the trucking market was

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Speaker 3: handled by brokers. In twenty eighteen, that number was right,

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Speaker 3: about twenty percent of all freight was handled by freight brokers.

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Speaker 3: Talking to companies like Triumph, which you know factor and

283
00:13:41,400 --> 00:13:43,719
Speaker 3: also have payment rails for a lot of freight, they

284
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Speaker 3: estimated is closer to forty to fifty percent. We would

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Speaker 3: say it's probably closer to a third now. And what

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00:13:49,360 --> 00:13:51,600
Speaker 3: we've had is this proliferation of brokers that have taken

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Speaker 3: up so much market share in the old days sort

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Speaker 3: of go back to the financial crisis in two thousand

289
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Speaker 3: and eight. What ends up happening when these routing guides

290
00:13:59,240 --> 00:14:01,480
Speaker 3: sort of, you know, win, the market starts to collapse.

291
00:14:01,520 --> 00:14:04,640
Speaker 3: What shippers have historically done is they pull freight from

292
00:14:04,800 --> 00:14:08,000
Speaker 3: sort of their smaller carriers and mid sized carriers and

293
00:14:08,000 --> 00:14:10,880
Speaker 3: sort of give it keep it to the largest carriers.

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Speaker 2: Because they want to preserve the capacity and they sort

295
00:14:12,800 --> 00:14:16,920
Speaker 2: of maintain it. Brokers have given and they're reluctant, historically

296
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Speaker 2: been reluctant sort of change pricing in intra cycle.

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Speaker 3: But what we've seen is that brokers have taken such

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00:14:23,400 --> 00:14:26,640
Speaker 3: a significant market share over the last ten years that

299
00:14:26,640 --> 00:14:30,880
Speaker 3: they've kept these small carriers, even if they're cheaper rates,

300
00:14:30,880 --> 00:14:33,240
Speaker 3: they kept them with freight. In the old days, what

301
00:14:33,400 --> 00:14:35,600
Speaker 3: happened is brokers would be left out of the routing

302
00:14:35,640 --> 00:14:39,560
Speaker 3: guides when the markets would collapse, and these small carriers,

303
00:14:39,560 --> 00:14:43,000
Speaker 3: which were dependent upon brokers, wouldn't have any freight opportunities.

304
00:14:43,040 --> 00:14:45,360
Speaker 3: What we've seen over the last couple of years is

305
00:14:45,400 --> 00:14:49,680
Speaker 3: that the shippers have become very comfortable with handling some

306
00:14:49,720 --> 00:14:52,640
Speaker 3: of their most important critical freight to freight brokerages. They've

307
00:14:52,640 --> 00:14:55,360
Speaker 3: taken up an enormous amount of market share to the

308
00:14:55,440 --> 00:14:58,240
Speaker 3: market and that has kept the small operators in business,

309
00:14:58,320 --> 00:15:01,680
Speaker 3: and so they've been able to generate cash, maybe not profits,

310
00:15:01,720 --> 00:15:03,320
Speaker 3: but they've been able to generate enough cash flow stay

311
00:15:03,320 --> 00:15:05,680
Speaker 3: in business. So that's one factor we would abscribe to

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Speaker 3: the reasons that we haven't seen a lot of carriers

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Speaker 3: go under. The second factor is something we recently discovered

314
00:15:11,400 --> 00:15:16,360
Speaker 3: and it actually happened sort of accidentally. I Firecrown buys

315
00:15:16,400 --> 00:15:21,040
Speaker 3: media assets, typically legacy magazines, and we started noticing this

316
00:15:21,120 --> 00:15:22,800
Speaker 3: year and a number of deals that we were looking

317
00:15:22,840 --> 00:15:25,920
Speaker 3: at were these SBA loans, these emergency loans during the

318
00:15:26,160 --> 00:15:31,800
Speaker 3: issue during COVID, And they were frankly, astoundingly.

319
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Speaker 2: Interesting to me because I'm like, what are these loans.

320
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Speaker 3: And their thirty year amateurization loans that were given out

321
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Speaker 3: during COVID at I think the it's three and a

322
00:15:45,080 --> 00:15:47,200
Speaker 3: half percent to three point seventy five. I think it's

323
00:15:47,240 --> 00:15:50,080
Speaker 3: three and a half percent is what the rate is

324
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Speaker 3: to small carriers, I mean to companies that took the

325
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Speaker 3: SBA loan. And so what this has enabled is and

326
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Speaker 3: then for two years the payments were deferred. Basically, what

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Speaker 3: happened is the SBA, and they gave out four hundred

328
00:16:05,600 --> 00:16:09,560
Speaker 3: billion or lended four hundred billion dollars to small businesses,

329
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Speaker 3: which is an astounding number. And small business of the

330
00:16:12,080 --> 00:16:15,960
Speaker 3: SBA lexicon is for and they have different classifications by

331
00:16:16,080 --> 00:16:19,720
Speaker 3: by industry. For transportation specifically, it's up to thirty two

332
00:16:19,760 --> 00:16:22,720
Speaker 3: million dollars. Is that the SBA says, that's a that's

333
00:16:22,720 --> 00:16:24,000
Speaker 3: classified as a small business.

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Speaker 2: And these these companies can go borrow money.

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Speaker 3: And so what the SBA did was they offered so

336
00:16:28,120 --> 00:16:31,520
Speaker 3: much capital to these small businesses that these small businesses

337
00:16:31,560 --> 00:16:36,200
Speaker 3: didn't have to generate profits during you know, from two

338
00:16:36,200 --> 00:16:39,440
Speaker 3: thousand and one or twenty twenty one, twenty twenty three,

339
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Speaker 3: and those payments started to resume in twenty four because

340
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Speaker 3: they had this sort of backstop and this.

341
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Speaker 2: Very favorable financing.

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00:16:45,880 --> 00:16:48,520
Speaker 3: And I had this sort of epiphany that this may

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Speaker 3: explain this capacity overhang, because we can explain how they've

344
00:16:52,320 --> 00:16:55,160
Speaker 3: been able to move freight even abysmal conditions, but it

345
00:16:55,200 --> 00:16:58,800
Speaker 3: still doesn't explain the capital and liquidity situation, like where

346
00:16:58,840 --> 00:17:02,040
Speaker 3: they actually funding their operations. Has been a big important

347
00:17:02,120 --> 00:17:05,560
Speaker 3: question that so many people have asked, and we ended

348
00:17:05,640 --> 00:17:08,320
Speaker 3: up doing a foid request with the SBA because they

349
00:17:08,320 --> 00:17:12,080
Speaker 3: don't actually publish the sick codes or the nights codes

350
00:17:12,160 --> 00:17:14,879
Speaker 3: for industries that they've given money to. And we finally

351
00:17:14,920 --> 00:17:18,280
Speaker 3: they responded, and what we determined was that they had

352
00:17:18,560 --> 00:17:24,000
Speaker 3: loaned about thirty eight billion dollars to transportation companies classified

353
00:17:24,000 --> 00:17:29,199
Speaker 3: as trucking, warehousing and logistics operators. About ten percent of

354
00:17:29,240 --> 00:17:32,720
Speaker 3: the total funding during that SBA program went to transportation,

355
00:17:33,760 --> 00:17:37,760
Speaker 3: and it was over four hundred thousand loans were issued,

356
00:17:38,040 --> 00:17:41,600
Speaker 3: and the average loan was about eighty eight thousand dollars

357
00:17:41,960 --> 00:17:44,359
Speaker 3: per company. And if you think about that from a

358
00:17:44,400 --> 00:17:48,199
Speaker 3: trucking perspective, that is an equivalent a trucking company an

359
00:17:48,240 --> 00:17:51,399
Speaker 3: owner operator will generate anywhere from sixty five to seventy

360
00:17:51,440 --> 00:17:55,720
Speaker 3: thousand dollars sort of take home pay as an independent

361
00:17:55,720 --> 00:17:58,520
Speaker 3: operator per year. If you think about it, that's a

362
00:17:58,600 --> 00:18:01,960
Speaker 3: roughly equivalent to one even two times of their sort

363
00:18:02,000 --> 00:18:06,560
Speaker 3: of total net And so this explains how a lot

364
00:18:06,600 --> 00:18:09,240
Speaker 3: of these small carriers had actually stayed in business.

365
00:18:09,280 --> 00:18:12,080
Speaker 2: They got incredibly favor financing.

366
00:18:12,040 --> 00:18:13,960
Speaker 3: And were able to sort of hang on a lot

367
00:18:14,040 --> 00:18:16,760
Speaker 3: longer than any of us expected. I think Derek Lather

368
00:18:16,920 --> 00:18:21,119
Speaker 3: is the CEO of Warner very on conference calls with

369
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Speaker 3: Analysis has been somewhat frustrated not being able to explain.

370
00:18:25,320 --> 00:18:27,600
Speaker 3: Neither have we, frankly, but he's been probably the most

371
00:18:27,600 --> 00:18:30,440
Speaker 3: outspoken about the fact that he expected a lot of

372
00:18:30,440 --> 00:18:32,720
Speaker 3: small carriers to leave the industry and they just didn't.

373
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Speaker 3: And we believe this partially explains the problem.

374
00:18:36,040 --> 00:18:37,159
Speaker 2: Is that the the.

375
00:18:37,119 --> 00:18:39,600
Speaker 3: SBA lines of credit, which was a once in a

376
00:18:40,520 --> 00:18:45,480
Speaker 3: potentially lifetime development, provided so much capital to these small

377
00:18:45,520 --> 00:18:47,840
Speaker 3: carriers that were able to hang on and they were

378
00:18:47,880 --> 00:18:52,280
Speaker 3: able to stay loaded, albeit at really small, much lower

379
00:18:52,359 --> 00:18:55,359
Speaker 3: rates with their with broker freight, and we think that

380
00:18:55,359 --> 00:18:57,000
Speaker 3: explains a lot of the conditions of the market.

381
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Speaker 1: All right, And when we were talking about broker freight,

382
00:18:59,200 --> 00:19:01,639
Speaker 1: I just want to like clear up some jargon for

383
00:19:01,760 --> 00:19:04,480
Speaker 1: some of our listeners. You mentioned routing guides. Can you

384
00:19:04,920 --> 00:19:06,800
Speaker 1: talk about what is a routing guide.

385
00:19:07,440 --> 00:19:10,840
Speaker 3: Shippers have what we call routing guides, which are essentially

386
00:19:10,880 --> 00:19:16,920
Speaker 3: electronic routing systems that direct freight. So when they get

387
00:19:16,920 --> 00:19:18,880
Speaker 3: a load and they get in order, they are out

388
00:19:18,960 --> 00:19:22,600
Speaker 3: sending out the freight to the carriers.

389
00:19:22,119 --> 00:19:23,119
Speaker 2: That they've contracted with.

390
00:19:23,200 --> 00:19:25,760
Speaker 3: So typically what happens is a shipper will do an

391
00:19:25,840 --> 00:19:29,160
Speaker 3: RFP and a trucking company will bid on that freight,

392
00:19:29,320 --> 00:19:31,920
Speaker 3: and the shipper will say, we're going to we are

393
00:19:31,960 --> 00:19:35,760
Speaker 3: going to reward you these lanes and this volume, and

394
00:19:35,800 --> 00:19:39,280
Speaker 3: the carrier is excited because they have this commitments. They're

395
00:19:39,280 --> 00:19:43,399
Speaker 3: committed in terms of sort of intentional commitment where the

396
00:19:43,400 --> 00:19:46,880
Speaker 3: shippers saying we will do this, but they're not contractually obligated.

397
00:19:47,000 --> 00:19:49,800
Speaker 3: The shipper's not contract obligated to give the freight, nor

398
00:19:49,920 --> 00:19:53,399
Speaker 3: is the carrier contractually obligated to actually show up with

399
00:19:53,480 --> 00:19:55,840
Speaker 3: a truck. And that's where that tender projection data becomes

400
00:19:55,840 --> 00:19:56,480
Speaker 3: really important.

401
00:19:56,760 --> 00:20:03,240
Speaker 2: But a routing guide specifically is essentially the order of preference.

402
00:20:03,320 --> 00:20:08,919
Speaker 3: Think of it is, if you're running a system and algorithm,

403
00:20:09,160 --> 00:20:12,879
Speaker 3: you're going to go and route freight to the cheapest carrier,

404
00:20:12,960 --> 00:20:16,359
Speaker 3: the person the carrier that's in the first position, second position,

405
00:20:16,400 --> 00:20:18,520
Speaker 3: third position. And what you're doing is you're sending over

406
00:20:18,560 --> 00:20:20,480
Speaker 3: an order and saying can you pick up this truck

407
00:20:20,680 --> 00:20:24,160
Speaker 3: or pick up this load, and the trucking company will

408
00:20:24,240 --> 00:20:25,160
Speaker 3: either accept.

409
00:20:24,920 --> 00:20:25,720
Speaker 2: Or reject that load.

410
00:20:25,800 --> 00:20:29,360
Speaker 3: If they accept it, great, that load picks up and

411
00:20:29,400 --> 00:20:31,920
Speaker 3: you go on about your business. If they reject that load,

412
00:20:32,359 --> 00:20:34,879
Speaker 3: it goes to the number two carrier in the routing guide,

413
00:20:34,960 --> 00:20:37,080
Speaker 3: so maybe the number one is JB. Hunt, number two

414
00:20:37,200 --> 00:20:40,359
Speaker 3: is Warner. Warner then gets it and says I can

415
00:20:40,400 --> 00:20:42,320
Speaker 3: pick it up. So now we've sort of gone out

416
00:20:42,359 --> 00:20:45,920
Speaker 3: our better business. It could very well be the third position.

417
00:20:46,040 --> 00:20:48,480
Speaker 3: So let's say that on a different load, we've gone

418
00:20:48,480 --> 00:20:50,760
Speaker 3: too first position. Jaby Hunt says no, Warner says no.

419
00:20:51,080 --> 00:20:53,960
Speaker 3: And on that third position, see Robinson is in that

420
00:20:54,000 --> 00:20:56,800
Speaker 3: sort of pole position on number three and they accept

421
00:20:56,800 --> 00:20:59,280
Speaker 3: the load. Now, what is important to know about freight

422
00:20:59,359 --> 00:21:01,479
Speaker 3: brokers is they actually own the trucks.

423
00:21:01,760 --> 00:21:03,040
Speaker 2: And JB. Hunt's case and A.

424
00:21:03,040 --> 00:21:06,120
Speaker 3: Werner's case, most likely it's one of their trucks that's

425
00:21:06,160 --> 00:21:08,560
Speaker 3: going to show up. So we have a yellow truck

426
00:21:08,640 --> 00:21:11,399
Speaker 3: or a blue truck, depending on which brand we're talking about.

427
00:21:11,640 --> 00:21:14,359
Speaker 3: But in Seage Robinson's case, they don't own the truck.

428
00:21:14,440 --> 00:21:17,240
Speaker 3: In fact, they probably don't even know which trucking company

429
00:21:17,280 --> 00:21:19,639
Speaker 3: is going to actually pick up that load. They're going

430
00:21:19,680 --> 00:21:23,280
Speaker 3: to go find the trucking company after they've secured the transaction,

431
00:21:23,440 --> 00:21:25,959
Speaker 3: so they're going to accept that transaction. And once they

432
00:21:26,000 --> 00:21:29,200
Speaker 3: accept that transaction, they're now on the hook to their

433
00:21:29,240 --> 00:21:32,840
Speaker 3: shipper to actually find a truck to pick up. And

434
00:21:32,920 --> 00:21:35,960
Speaker 3: so that is when we talk about routing guides, That's

435
00:21:35,960 --> 00:21:38,919
Speaker 3: what we're referring to, is that basically order of preference

436
00:21:39,000 --> 00:21:42,600
Speaker 3: that the system of the algorithm, the piece of software

437
00:21:42,640 --> 00:21:48,480
Speaker 3: that routes freight typically based on least cost in the schedule,

438
00:21:48,880 --> 00:21:52,359
Speaker 3: is how they typically route it, and they will determine

439
00:21:52,920 --> 00:21:55,040
Speaker 3: a shipper will determine who gets the freight based on

440
00:21:55,080 --> 00:21:55,760
Speaker 3: those conditions.

441
00:21:56,480 --> 00:21:59,560
Speaker 1: Gotcha. And so, you know, we talked a lot about

442
00:21:59,640 --> 00:22:01,879
Speaker 1: rates and kind of where they are and where we

443
00:22:01,880 --> 00:22:05,800
Speaker 1: think they're heading. What other challenges is the trucking industry

444
00:22:05,840 --> 00:22:07,719
Speaker 1: face besides depressed rates.

445
00:22:08,880 --> 00:22:14,479
Speaker 3: So I mean, look, trucking has always faces significant amounts

446
00:22:14,480 --> 00:22:18,919
Speaker 3: of inflationary pressures. I mean, equipment has become far more expensive,

447
00:22:19,359 --> 00:22:22,960
Speaker 3: mechanics and maintenance professionals. You know, we talk about the

448
00:22:23,040 --> 00:22:26,400
Speaker 3: lack of driver availability a lot, there's a lot less

449
00:22:26,440 --> 00:22:30,479
Speaker 3: conversation about the lack of mechanics and trained mechanics that

450
00:22:30,480 --> 00:22:33,200
Speaker 3: can actually work on equipment. This is a big issue

451
00:22:33,200 --> 00:22:36,040
Speaker 3: and this has created a lot of inflation on equipment.

452
00:22:36,119 --> 00:22:38,720
Speaker 3: Maintenance inflation has been pretty significant, not to just mention

453
00:22:38,760 --> 00:22:41,760
Speaker 3: the trucks themselves, cost of capital. This is an industry

454
00:22:41,760 --> 00:22:45,080
Speaker 3: that relies upon a lot of a bank debt. Debt

455
00:22:45,160 --> 00:22:48,960
Speaker 3: is a is an instrument essentially that the industry uses

456
00:22:49,000 --> 00:22:51,680
Speaker 3: to capitalize its equipment and run its operations.

457
00:22:51,880 --> 00:22:54,960
Speaker 2: Well, the cost has gone up significant there, so you're.

458
00:22:54,840 --> 00:22:59,320
Speaker 3: Dealing with a lot of inflationary issues that were caused

459
00:22:59,600 --> 00:23:02,359
Speaker 3: by all of the things that have been talked about

460
00:23:02,400 --> 00:23:05,560
Speaker 3: in terms of sort of economic inflation has been thrust

461
00:23:05,640 --> 00:23:07,719
Speaker 3: upon the trucking industry. And so if you look at

462
00:23:07,720 --> 00:23:09,680
Speaker 3: the cost of operating in a truck sort of versus

463
00:23:09,720 --> 00:23:12,760
Speaker 3: pre COVID, we're talking, you know, thirty five to forty percent.

464
00:23:12,800 --> 00:23:14,800
Speaker 2: And we're not even talking about fuel in that case.

465
00:23:14,800 --> 00:23:18,160
Speaker 3: We're talking about the core operations of a trucking company.

466
00:23:18,520 --> 00:23:24,120
Speaker 3: Driver wages, equipment, insurance, maintenance costs have all gone up,

467
00:23:24,520 --> 00:23:27,320
Speaker 3: you know, thirty tot.

468
00:23:28,160 --> 00:23:30,320
Speaker 2: And we're in a situation.

469
00:23:29,960 --> 00:23:37,600
Speaker 3: Where the the.

470
00:23:34,840 --> 00:23:36,840
Speaker 2: The rest of the operation is being impacted.

471
00:23:36,920 --> 00:23:42,640
Speaker 3: So tough conditions combined with increasing cost is not mak anyone.

472
00:23:42,359 --> 00:23:44,960
Speaker 1: Happy, right right, And and truckers are going to be

473
00:23:45,000 --> 00:23:48,720
Speaker 1: facing even higher costs for equipment with a new EPA mandate.

474
00:23:48,880 --> 00:23:53,040
Speaker 1: Mandate in twenty twenty seven, is that under radar it is.

475
00:23:53,119 --> 00:23:55,200
Speaker 2: I think there's a lot of questions about what happens.

476
00:23:55,720 --> 00:23:57,959
Speaker 2: Two things. When is the Chevron.

477
00:23:57,680 --> 00:24:00,840
Speaker 3: Supreme Court case that where the Chevron prins was rolled out,

478
00:24:00,920 --> 00:24:03,479
Speaker 3: is what is going to happen with the litigation? You know,

479
00:24:04,000 --> 00:24:07,199
Speaker 3: what was determined by that case is that perhaps the

480
00:24:07,240 --> 00:24:11,320
Speaker 3: EPA maybe you know, maybe outside of its boundaries of

481
00:24:11,359 --> 00:24:13,240
Speaker 3: what it can actually regulate. So that's a question I

482
00:24:13,240 --> 00:24:14,280
Speaker 3: think is on people's mind.

483
00:24:14,480 --> 00:24:16,200
Speaker 2: Also, the election could very well alternate.

484
00:24:16,240 --> 00:24:18,560
Speaker 3: I mean, if if Trump were to win the election,

485
00:24:19,119 --> 00:24:21,280
Speaker 3: I would expect a lot of the EPA regulations to

486
00:24:21,320 --> 00:24:24,760
Speaker 3: be called back. And that's probably one of those that

487
00:24:24,760 --> 00:24:27,679
Speaker 3: that we potentially would expect to see. So it's not

488
00:24:27,960 --> 00:24:30,399
Speaker 3: currently at least from what we're tracking. You may have

489
00:24:30,440 --> 00:24:35,040
Speaker 3: different data than we do, but we're not seeing any Anybody,

490
00:24:35,560 --> 00:24:38,639
Speaker 3: at least in the carrier operators spent a lot of

491
00:24:38,720 --> 00:24:42,040
Speaker 3: effort thinking about that or planning for that. I think

492
00:24:42,080 --> 00:24:45,119
Speaker 3: we would expect to see that probably in late twenty

493
00:24:45,119 --> 00:24:49,280
Speaker 3: five and twenty six before and what we've seen historically

494
00:24:49,400 --> 00:24:52,280
Speaker 3: is this big build of capacity that happens in advance

495
00:24:52,320 --> 00:24:55,520
Speaker 3: of these EPA regulation changes because the equipment cuts pretty

496
00:24:55,520 --> 00:25:00,399
Speaker 3: expensive and so we haven't yet seen any data that

497
00:25:00,480 --> 00:25:02,000
Speaker 3: suggesting that's the taking place.

498
00:25:02,200 --> 00:25:04,320
Speaker 1: Right, Yeah, I would agree probably in twenty late twenty

499
00:25:04,320 --> 00:25:06,520
Speaker 1: twenty five you could start start seeing a pre buy

500
00:25:06,680 --> 00:25:09,679
Speaker 1: and also that would push up the used equipment market

501
00:25:09,720 --> 00:25:13,680
Speaker 1: as well, which good for those companies that sell into

502
00:25:13,720 --> 00:25:15,200
Speaker 1: the used equipment market.

503
00:25:15,240 --> 00:25:17,920
Speaker 3: The OEMs have set this whole recession out. I mean,

504
00:25:18,040 --> 00:25:21,720
Speaker 3: usually they're in the freight recession. Anytime you have a

505
00:25:21,720 --> 00:25:24,800
Speaker 3: freight recession, usually the OEMs are impacted. Not this time,

506
00:25:24,920 --> 00:25:27,760
Speaker 3: they have actually been able to weather the storm pretty well.

507
00:25:28,600 --> 00:25:30,879
Speaker 3: I think there's a question about whether it's starting to

508
00:25:30,880 --> 00:25:33,240
Speaker 3: catch up to them. You know, there's some some anecdotes

509
00:25:33,280 --> 00:25:35,120
Speaker 3: and some data that says that some of the new

510
00:25:35,119 --> 00:25:39,280
Speaker 3: trucks truck orders are slowing. But they've really largely set

511
00:25:39,320 --> 00:25:42,440
Speaker 3: out the really difficult and challenging conditions that matter cares

512
00:25:42,440 --> 00:25:43,000
Speaker 3: have been facing.

513
00:25:43,720 --> 00:25:47,720
Speaker 1: Right, So, you can't talk about trucking without talking about technology.

514
00:25:47,800 --> 00:25:50,439
Speaker 1: You know, even though it's an old world industry, there

515
00:25:50,560 --> 00:25:53,360
Speaker 1: there's a lot of new things going on. I get

516
00:25:53,400 --> 00:25:56,440
Speaker 1: at least fifty percent more listens if I mentioned the

517
00:25:56,440 --> 00:26:00,840
Speaker 1: word AI so AI AI AI kind of in that

518
00:26:01,000 --> 00:26:04,879
Speaker 1: vein autonomous trucking are you a bull, you a bear?

519
00:26:05,160 --> 00:26:07,040
Speaker 1: Where do you see that playing out over time?

520
00:26:07,640 --> 00:26:13,119
Speaker 3: I'm a bear, so long term I would say autonomous

521
00:26:13,119 --> 00:26:16,400
Speaker 3: trucking is inevitable, But I'm a bear in the next

522
00:26:16,440 --> 00:26:19,240
Speaker 3: ten years, and so I think what we're seeing is

523
00:26:19,800 --> 00:26:23,960
Speaker 3: technology can be ready much faster than of the public

524
00:26:24,000 --> 00:26:28,560
Speaker 3: acceptance of these technologies or even the regulatory environment accepting them.

525
00:26:28,640 --> 00:26:31,920
Speaker 3: I had a conversation a couple years back with the

526
00:26:31,920 --> 00:26:35,160
Speaker 3: general counsel at the FMCSA, and I asked some point

527
00:26:35,200 --> 00:26:37,680
Speaker 3: blank about the hours of service, because an autonomous truck

528
00:26:37,720 --> 00:26:41,680
Speaker 3: can run arguably twenty three to twenty four hours a

529
00:26:41,760 --> 00:26:44,880
Speaker 3: day because it doesn't have a human driver as long

530
00:26:44,920 --> 00:26:47,479
Speaker 3: as it's being fueled up or being powered. Basically can

531
00:26:47,520 --> 00:26:50,000
Speaker 3: run non stops and maybe go down for maintenance, and

532
00:26:50,040 --> 00:26:52,680
Speaker 3: so it has a lot of advantages because it doesn't

533
00:26:52,720 --> 00:26:56,640
Speaker 3: operate on a clock the way human drivers are required

534
00:26:56,680 --> 00:26:59,480
Speaker 3: to do through the hours of service regulation. And so

535
00:26:59,800 --> 00:27:02,639
Speaker 3: the question was is it fair or will it be

536
00:27:02,800 --> 00:27:06,080
Speaker 3: fair to let the autonomous trucks run twenty three or

537
00:27:06,119 --> 00:27:10,159
Speaker 3: twenty four hours a day when a human driver is

538
00:27:10,480 --> 00:27:13,480
Speaker 3: limited to eleven And the response that I got was

539
00:27:13,480 --> 00:27:17,000
Speaker 3: really interesting, and he said the issue is that in

540
00:27:17,040 --> 00:27:19,840
Speaker 3: the FMCSA's rules there is no.

541
00:27:20,000 --> 00:27:22,199
Speaker 2: Conversation about a human driver to begin with.

542
00:27:22,400 --> 00:27:26,480
Speaker 3: They don't even know in their regulations if autonomous trucking

543
00:27:27,000 --> 00:27:29,879
Speaker 3: is even permitted under the sort of the way that

544
00:27:29,880 --> 00:27:33,320
Speaker 3: they've constructed it. There had been some initiatives to let

545
00:27:33,520 --> 00:27:37,199
Speaker 3: pilot tests take place, and they've done some pilots, but

546
00:27:37,280 --> 00:27:39,400
Speaker 3: the FMCSA has a long way to go.

547
00:27:39,480 --> 00:27:41,040
Speaker 2: And we're talking about a government.

548
00:27:40,720 --> 00:27:44,760
Speaker 3: Agency, and we've seen how slaid the FAA is even

549
00:27:44,760 --> 00:27:47,040
Speaker 3: to adapt things like five G. It's going to take

550
00:27:47,040 --> 00:27:49,000
Speaker 3: a while before the FMCSA to sort of get their

551
00:27:49,040 --> 00:27:51,520
Speaker 3: heads around autonomous trucking. So we have a regulatory issue,

552
00:27:51,760 --> 00:27:53,679
Speaker 3: and then we have with autonomous trucks.

553
00:27:53,680 --> 00:27:54,600
Speaker 2: If I want to go from.

554
00:27:54,440 --> 00:27:58,639
Speaker 3: A warehouse to a store or a factory to a warehouse,

555
00:27:58,920 --> 00:28:01,119
Speaker 3: I'm going to have to use non federal highways, and

556
00:28:01,200 --> 00:28:03,840
Speaker 3: we have to use state highways and local municipalities.

557
00:28:04,240 --> 00:28:05,720
Speaker 2: And we've seen in places.

558
00:28:05,359 --> 00:28:09,840
Speaker 3: Like California that have actually said that autonomous trucks are

559
00:28:09,920 --> 00:28:12,080
Speaker 3: banned or tried to ban these things, or there have

560
00:28:12,080 --> 00:28:15,040
Speaker 3: been conversations in the state legislature to do so. So

561
00:28:15,119 --> 00:28:17,040
Speaker 3: the question is is an a moto carrier. Am I

562
00:28:17,119 --> 00:28:22,399
Speaker 3: going to make the investments in a autonomous truck not

563
00:28:22,640 --> 00:28:25,640
Speaker 3: knowing whether the regulatory environment is going to be favorable

564
00:28:25,680 --> 00:28:27,200
Speaker 3: to that investment over the long term.

565
00:28:27,480 --> 00:28:28,560
Speaker 2: And so I think that's.

566
00:28:28,400 --> 00:28:33,199
Speaker 3: The biggest question is public acceptance and more importantly, regulatory

567
00:28:33,280 --> 00:28:37,200
Speaker 3: acceptance of autonomous vehicles. And I don't think we're anywhere

568
00:28:37,320 --> 00:28:40,600
Speaker 3: close to that happening anytime soon. I think these small

569
00:28:40,640 --> 00:28:43,400
Speaker 3: pilots are okay, and we're you know, we've seen them

570
00:28:43,440 --> 00:28:47,120
Speaker 3: throughout you know, different states where Texas is doing some pilots,

571
00:28:47,120 --> 00:28:51,480
Speaker 3: and we've seen you know, the old Budweiser driving down

572
00:28:51,680 --> 00:28:52,320
Speaker 3: the road when.

573
00:28:52,240 --> 00:28:53,080
Speaker 2: Uber Freight did it.

574
00:28:53,880 --> 00:28:58,320
Speaker 3: But we've not seen really a commercial level activity happening

575
00:28:58,320 --> 00:29:02,240
Speaker 3: with autonomous trucks. And there will be an enormous amount

576
00:29:02,280 --> 00:29:05,760
Speaker 3: of public backlash when they happen, simply because it's a

577
00:29:07,200 --> 00:29:09,600
Speaker 3: it's fraught with a lot of social questions that are

578
00:29:09,720 --> 00:29:10,600
Speaker 3: yet to be answered.

579
00:29:11,000 --> 00:29:15,120
Speaker 1: Yeah, I agree. I agree with that stance completely. So

580
00:29:15,840 --> 00:29:19,960
Speaker 1: at the crossroads of technology and you know, emissions, because

581
00:29:19,960 --> 00:29:23,360
Speaker 1: we were talking about EPA standards and autonomous trucking, there's

582
00:29:23,440 --> 00:29:24,560
Speaker 1: elect electric trucks.

583
00:29:25,400 --> 00:29:26,040
Speaker 2: Where are your.

584
00:29:25,880 --> 00:29:28,200
Speaker 1: Thoughts on there? You know, I know they've been really

585
00:29:28,240 --> 00:29:30,920
Speaker 1: slow to adopt for various reasons. A lot of that

586
00:29:30,960 --> 00:29:34,320
Speaker 1: has to do with the ability to have the infrastructure

587
00:29:34,400 --> 00:29:39,400
Speaker 1: to charge them. Where do you kind of sit on

588
00:29:40,040 --> 00:29:42,120
Speaker 1: electronic trucks or electric trucks?

589
00:29:42,400 --> 00:29:44,400
Speaker 3: Yeah, well, I'm glad you asked those because this is

590
00:29:44,480 --> 00:29:49,080
Speaker 3: such an important conversation or industries, the regulatory and sort

591
00:29:49,080 --> 00:29:53,880
Speaker 3: of public belief. The regulators and the public sort of

592
00:29:53,880 --> 00:29:57,959
Speaker 3: believe that these electric semis is class eight trucks are

593
00:29:58,040 --> 00:30:01,480
Speaker 3: market ready and like we can of love and blame

594
00:30:01,640 --> 00:30:04,080
Speaker 3: Elon Musk at the same time, like what he's done

595
00:30:04,120 --> 00:30:07,120
Speaker 3: to sort of bring public awareness and make trucking coal

596
00:30:07,160 --> 00:30:09,880
Speaker 3: When he's stood on stage in twenty seventeen with the

597
00:30:09,920 --> 00:30:12,920
Speaker 3: Tesla Semi behind him, or maybe its late twenty sixteen

598
00:30:12,920 --> 00:30:16,600
Speaker 3: and talked about the seventeen proliferation of the Tesla Semi.

599
00:30:16,640 --> 00:30:18,680
Speaker 3: He's going to have two hundred thousand of these the

600
00:30:18,720 --> 00:30:19,800
Speaker 3: end of twenty.

601
00:30:19,400 --> 00:30:21,040
Speaker 2: Twenty two, a trucking pool.

602
00:30:21,200 --> 00:30:24,480
Speaker 3: All of a sudden, the public media was writing about

603
00:30:24,480 --> 00:30:27,280
Speaker 3: trucking in a very favorable talking about the future of

604
00:30:27,320 --> 00:30:31,200
Speaker 3: the industry. The challenge is he's only delivered they Tesla

605
00:30:31,320 --> 00:30:34,280
Speaker 3: has produced. This is a report in May a total

606
00:30:34,280 --> 00:30:36,800
Speaker 3: of one hundred and forty Tesla semis. He talked about

607
00:30:36,800 --> 00:30:37,880
Speaker 3: two hundred thousand of them.

608
00:30:38,480 --> 00:30:39,840
Speaker 2: They've only produced one hundred and forty.

609
00:30:39,880 --> 00:30:43,440
Speaker 3: In fact, about a large portion of those Tesla Semis

610
00:30:43,440 --> 00:30:49,160
Speaker 3: are actually hauling Tesla's own freight. The only major customer

611
00:30:49,200 --> 00:30:52,360
Speaker 3: that's actually received deliveries of them is PepsiCo, which has

612
00:30:52,400 --> 00:30:54,880
Speaker 3: been a lot of this has been public and reported

613
00:30:54,920 --> 00:30:58,880
Speaker 3: by Bloomberg and other sources. Is that, you know, Pepsi

614
00:30:59,120 --> 00:31:02,120
Speaker 3: received a very large grant from the state of California

615
00:31:02,400 --> 00:31:06,400
Speaker 3: from carb to actually implement an electric fleet, and that

616
00:31:06,560 --> 00:31:10,920
Speaker 3: funded the rollout of these Tesla semis. And so what

617
00:31:10,960 --> 00:31:13,640
Speaker 3: has happened is about a third of those Tesla semis

618
00:31:13,680 --> 00:31:17,360
Speaker 3: from also reports failed, had a number of issues and.

619
00:31:17,320 --> 00:31:19,920
Speaker 2: Were recalled when they were produced. And this is this

620
00:31:19,960 --> 00:31:20,760
Speaker 2: should be expected.

621
00:31:20,760 --> 00:31:23,240
Speaker 3: This is a new technology, this is something that needs

622
00:31:23,280 --> 00:31:25,960
Speaker 3: to be tested in the field, and so we would

623
00:31:26,000 --> 00:31:27,120
Speaker 3: expect there to be a lot of.

624
00:31:27,080 --> 00:31:29,160
Speaker 2: Problems with the technology when it's rolled out.

625
00:31:29,680 --> 00:31:33,160
Speaker 3: And that's what Tesla and frankly the industry is contending with,

626
00:31:33,720 --> 00:31:38,720
Speaker 3: and so Pepsi, since they took delivery two years ago

627
00:31:38,840 --> 00:31:43,719
Speaker 3: of their first Tesla Semi order, is taking the equivalent

628
00:31:43,840 --> 00:31:46,760
Speaker 3: of what that one delivery was, they're taking equivalent of

629
00:31:46,800 --> 00:31:49,960
Speaker 3: that on a monthly basis in terms of new Class

630
00:31:50,000 --> 00:31:54,080
Speaker 3: eight diesel trucks. And so what we're seeing is a

631
00:31:54,080 --> 00:31:59,160
Speaker 3: situation where the public belief and acceptance of these technologies

632
00:31:59,720 --> 00:32:04,160
Speaker 3: isting pressure on regulators to create laws they don't actually

633
00:32:04,200 --> 00:32:07,160
Speaker 3: match up to the physics of the equipment to handle

634
00:32:07,200 --> 00:32:12,160
Speaker 3: the missions nor the actual technology itself to be mission ready.

635
00:32:12,240 --> 00:32:14,320
Speaker 3: And so one of the things we do a freightways

636
00:32:14,320 --> 00:32:15,959
Speaker 3: we have a you know, we have a media business,

637
00:32:15,960 --> 00:32:19,200
Speaker 3: but we also have you know, podcasts that are oriented

638
00:32:19,200 --> 00:32:20,120
Speaker 3: towards truck drivers.

639
00:32:20,120 --> 00:32:23,480
Speaker 2: One of us is called what the Truck and Tim Doner.

640
00:32:24,000 --> 00:32:29,200
Speaker 3: Constantly we get these we get these notes from you know,

641
00:32:29,240 --> 00:32:32,200
Speaker 3: these these messages from drivers or people in the public

642
00:32:32,600 --> 00:32:35,080
Speaker 3: see the Tesla Semi being toad. And so we've been

643
00:32:35,160 --> 00:32:38,040
Speaker 3: tracking how many of these semis individual because you can

644
00:32:38,080 --> 00:32:41,200
Speaker 3: actually see that whether there are individuals we're I think

645
00:32:41,200 --> 00:32:43,440
Speaker 3: the last count was like eighteen of these Tesla semis

646
00:32:43,440 --> 00:32:45,880
Speaker 3: that were independently towed out on the road. So it's

647
00:32:45,880 --> 00:32:49,680
Speaker 3: not market ready technology. And if Tesla, which is arguably

648
00:32:49,760 --> 00:32:54,000
Speaker 3: the most successful American EV manufacturer, has not been able

649
00:32:54,000 --> 00:32:56,880
Speaker 3: to make the technology market ready in a way that

650
00:32:56,920 --> 00:32:59,080
Speaker 3: the industry will accept it. It's it's hard for me

651
00:32:59,160 --> 00:33:01,560
Speaker 3: to believe that we will see the other OEMs catch

652
00:33:01,640 --> 00:33:04,520
Speaker 3: up to that point and they'll be able to deliver

653
00:33:04,600 --> 00:33:07,360
Speaker 3: the technology. So that's the technology side of it, and Lee,

654
00:33:07,480 --> 00:33:08,960
Speaker 3: we can spend a lot of time talking about the

655
00:33:09,040 --> 00:33:11,880
Speaker 3: lack of charging infrastructure. We can talk about the lack

656
00:33:11,920 --> 00:33:15,440
Speaker 3: of dependability, the fact that fleets just simply when they

657
00:33:15,480 --> 00:33:18,480
Speaker 3: buy a truck, they're buying it based on total cost

658
00:33:18,560 --> 00:33:22,520
Speaker 3: of ownership and reliability. Both those things haven't been proven out.

659
00:33:22,640 --> 00:33:25,040
Speaker 3: I mean, a fleet is not going to you know,

660
00:33:25,080 --> 00:33:26,920
Speaker 3: one of the cost bases of a truck and fleet,

661
00:33:27,320 --> 00:33:29,560
Speaker 3: it's not just the cost of acquiring the truck, but

662
00:33:29,600 --> 00:33:31,600
Speaker 3: also what the residual value of that truck is when

663
00:33:31,640 --> 00:33:33,880
Speaker 3: they go to sell it. And because there's no third

664
00:33:33,880 --> 00:33:36,640
Speaker 3: party market for these trucks yet, because there just aren't

665
00:33:36,720 --> 00:33:40,000
Speaker 3: enough out there, there's no real way to actually know

666
00:33:40,080 --> 00:33:42,120
Speaker 3: what it will cost you when you get rid of

667
00:33:42,160 --> 00:33:44,160
Speaker 3: it and you go sell it when you liquidate it,

668
00:33:44,480 --> 00:33:45,840
Speaker 3: and so there's a.

669
00:33:45,840 --> 00:33:47,280
Speaker 2: Lot of issues with EVS.

670
00:33:47,480 --> 00:33:50,480
Speaker 3: I you know, I love the fact that the major

671
00:33:50,520 --> 00:33:53,320
Speaker 3: media is reporting on all the technology and bringing the

672
00:33:53,360 --> 00:33:56,000
Speaker 3: awareness because I think it changes the image and it

673
00:33:56,040 --> 00:33:58,120
Speaker 3: creates a lot of sort of excitement around what's going

674
00:33:58,120 --> 00:34:01,280
Speaker 3: on in freight. But oftentimes they tend to be very

675
00:34:01,360 --> 00:34:04,360
Speaker 3: excited about technologies that just aren't market ready, and autonomous

676
00:34:04,360 --> 00:34:06,480
Speaker 3: and EV are probably the best examples of that. You know,

677
00:34:06,520 --> 00:34:09,160
Speaker 3: when we started Freightways, there was something like sixteen different

678
00:34:09,560 --> 00:34:14,560
Speaker 3: venture backed autonomous trucking companies. Are companies that were building

679
00:34:14,600 --> 00:34:17,160
Speaker 3: autonomous trucks. I think we're down to two. They're doing

680
00:34:17,239 --> 00:34:21,680
Speaker 3: over the road trucking, heavy duty trucking, and EV is

681
00:34:21,760 --> 00:34:22,640
Speaker 3: much the same story.

682
00:34:23,600 --> 00:34:26,920
Speaker 1: Gotcha, So you know you're you're mentioning earlier the brokerage

683
00:34:26,960 --> 00:34:30,960
Speaker 1: industry and how involved they are in the trucking world

684
00:34:31,000 --> 00:34:35,360
Speaker 1: today versus a couple of decades ago. Do you do

685
00:34:35,400 --> 00:34:37,759
Speaker 1: you have a kind of a thought on where you

686
00:34:37,800 --> 00:34:41,239
Speaker 1: see the brokerage industry heading. We've seen a couple of

687
00:34:41,280 --> 00:34:45,760
Speaker 1: large deals, you know RXO buying UPS's Coyote. You see

688
00:34:45,800 --> 00:34:48,920
Speaker 1: a lot of the publicly traded trucking companies try to

689
00:34:48,960 --> 00:34:53,400
Speaker 1: grow that business because it's a you know, non asset

690
00:34:54,120 --> 00:34:58,480
Speaker 1: high ROI kind of investment that they can make. Where

691
00:34:58,520 --> 00:35:01,200
Speaker 1: do you see the brokerage busines business in the next

692
00:35:01,239 --> 00:35:03,520
Speaker 1: five years a relative to where it is today.

693
00:35:04,000 --> 00:35:06,080
Speaker 3: Yeah, it's really interesting, you know, growing up in this

694
00:35:06,120 --> 00:35:08,279
Speaker 3: industry and being from a family that has been in

695
00:35:08,320 --> 00:35:13,520
Speaker 3: it for many generations. The belief in my family and

696
00:35:13,600 --> 00:35:15,920
Speaker 3: I think a lot of the larger trucking companies, is

697
00:35:15,960 --> 00:35:18,240
Speaker 3: the industry was going to consolidate it at some point

698
00:35:18,280 --> 00:35:21,120
Speaker 3: we would have ten big trucking companies like the airlines.

699
00:35:21,520 --> 00:35:23,880
Speaker 3: We actually seen the exact opposite of that, and what

700
00:35:23,920 --> 00:35:29,080
Speaker 3: we've seen is that the industry continues to fragment. The

701
00:35:29,200 --> 00:35:31,880
Speaker 3: largest carriers went from handling something like if you go

702
00:35:31,920 --> 00:35:34,120
Speaker 3: back to two thousand and eight, so they're like fifty

703
00:35:34,200 --> 00:35:36,440
Speaker 3: six to fifty eight percent of the freight we're talking

704
00:35:36,480 --> 00:35:39,920
Speaker 3: that thousand trucks or more, down to about thirty one percent.

705
00:35:39,920 --> 00:35:43,560
Speaker 3: And what's happened is that the smallest carriers have really

706
00:35:43,600 --> 00:35:46,920
Speaker 3: grown their market share. You know, they have grown substantially

707
00:35:47,000 --> 00:35:49,880
Speaker 3: in terms of it. And that's really because brokers have

708
00:35:50,360 --> 00:35:52,439
Speaker 3: taken that shit, have taken so much of a share

709
00:35:52,480 --> 00:35:55,200
Speaker 3: of freight and have allowed small carriers to operate and

710
00:35:55,280 --> 00:35:57,320
Speaker 3: eliminated frankly, the bearers of entry.

711
00:35:57,800 --> 00:35:59,000
Speaker 2: So I'm very bullish.

712
00:35:59,120 --> 00:36:02,759
Speaker 3: I think this is a a situation where brokerage is

713
00:36:02,760 --> 00:36:05,239
Speaker 3: going to continue to take market share. It's going to

714
00:36:05,239 --> 00:36:07,759
Speaker 3: continue to play out. I think we've seen that the

715
00:36:07,880 --> 00:36:11,920
Speaker 3: largest four higher trucking companies, if you go back to

716
00:36:12,239 --> 00:36:16,640
Speaker 3: thirty years ago, the most profitable trucking companies in America

717
00:36:16,719 --> 00:36:20,920
Speaker 3: were in the long haul market. You know, Transport America, CFI,

718
00:36:21,520 --> 00:36:24,640
Speaker 3: sell it On, Covenant, and US Express were in the

719
00:36:24,680 --> 00:36:29,040
Speaker 3: sort of top tier of profitability. In the nineties, they

720
00:36:29,040 --> 00:36:32,600
Speaker 3: were growing exceptionally fast because they were really benefiting from

721
00:36:32,680 --> 00:36:33,120
Speaker 3: long haul.

722
00:36:33,400 --> 00:36:34,480
Speaker 2: And then two things happened.

723
00:36:35,160 --> 00:36:38,640
Speaker 3: The intermodial market really destroyed a lot of the sort

724
00:36:38,680 --> 00:36:42,839
Speaker 3: of economic favorability of long haul trucking, and frankly brokerage.

725
00:36:43,920 --> 00:36:44,920
Speaker 2: The brokers were.

726
00:36:44,800 --> 00:36:48,000
Speaker 3: Able to sort of take significant share on those highly

727
00:36:48,080 --> 00:36:52,840
Speaker 3: liquid long distance lanes because they were favor owner operators

728
00:36:52,880 --> 00:36:54,600
Speaker 3: tend to favor those lanes, they tend to prefer them.

729
00:36:54,640 --> 00:36:57,160
Speaker 3: And so what we've seen is that the largest asset

730
00:36:57,239 --> 00:37:00,399
Speaker 3: carriers have largely exited the four higher market. In fact,

731
00:37:00,400 --> 00:37:04,040
Speaker 3: if you go look at the largest public chucolate carriers

732
00:37:04,280 --> 00:37:06,040
Speaker 3: and you look at their earnings, the majority of those

733
00:37:06,080 --> 00:37:09,439
Speaker 3: are not generating money in their four higher markets, they're

734
00:37:09,480 --> 00:37:13,360
Speaker 3: generating money and dedicated in logistics, and you know, in

735
00:37:13,440 --> 00:37:16,080
Speaker 3: Covenant's case, and they hauled a chicken hauler and so

736
00:37:16,680 --> 00:37:19,680
Speaker 3: managed logistics services and stuff. And so we're seeing a

737
00:37:19,719 --> 00:37:23,840
Speaker 3: situation where a lot of the large asset carriers have

738
00:37:24,000 --> 00:37:28,080
Speaker 3: tried to exit their four higher trucking operations because those

739
00:37:28,120 --> 00:37:32,880
Speaker 3: businesses are incredibly hard to operate and have moved into

740
00:37:32,960 --> 00:37:36,600
Speaker 3: much higher value in much more predictable revenue streams like

741
00:37:36,680 --> 00:37:37,880
Speaker 3: brokerage and dedicated.

742
00:37:38,400 --> 00:37:39,879
Speaker 2: In the old days, the.

743
00:37:39,920 --> 00:37:44,120
Speaker 3: Large asset carriers would launch a brokerage, but it was

744
00:37:44,200 --> 00:37:45,640
Speaker 3: basically a filler operation.

745
00:37:46,239 --> 00:37:48,120
Speaker 2: It would get overflow that.

746
00:37:48,040 --> 00:37:51,919
Speaker 3: Came from their asset side, or it would basically help

747
00:37:51,960 --> 00:37:54,640
Speaker 3: them fill their trucks when they couldn't hand when they

748
00:37:54,640 --> 00:37:56,160
Speaker 3: didn't have enough loads to handle it.

749
00:37:57,320 --> 00:38:00,319
Speaker 2: In today's market, I think JB. Hunt Schneider are.

750
00:38:00,200 --> 00:38:02,680
Speaker 3: Probably the most successful at proving that you can actually

751
00:38:02,719 --> 00:38:05,800
Speaker 3: run a logistics operation as a logistics operation.

752
00:38:06,080 --> 00:38:09,240
Speaker 2: And not as a as a sort of a filler

753
00:38:09,239 --> 00:38:10,960
Speaker 2: to you have to run it as a completely separate

754
00:38:11,000 --> 00:38:11,400
Speaker 2: P and L.

755
00:38:11,760 --> 00:38:13,400
Speaker 3: And I think what they've proven is that they can

756
00:38:13,440 --> 00:38:18,440
Speaker 3: build very successful brokerage and three PL operations that operate

757
00:38:18,560 --> 00:38:22,160
Speaker 3: independent of the interest of the trucking company, and what

758
00:38:22,160 --> 00:38:24,719
Speaker 3: we've seen is that that has been rewarded by Wall

759
00:38:24,760 --> 00:38:27,359
Speaker 3: Street for doing so, and they're frankly their earnings are

760
00:38:27,360 --> 00:38:28,840
Speaker 3: far more predictable than they were before.

761
00:38:29,680 --> 00:38:33,120
Speaker 1: All right, great, So, just on a tangent, what's your

762
00:38:33,120 --> 00:38:35,560
Speaker 1: favorite part of your job? You know, wearing all those

763
00:38:35,600 --> 00:38:37,120
Speaker 1: hats that you wear at.

764
00:38:38,040 --> 00:38:40,920
Speaker 3: Like, I love being a student of the of the

765
00:38:40,960 --> 00:38:43,280
Speaker 3: industries that I'm in, so and freight.

766
00:38:43,480 --> 00:38:44,680
Speaker 2: You know, I grew up in this business.

767
00:38:44,719 --> 00:38:47,560
Speaker 3: I say, I have diesel in my blood, which means

768
00:38:47,600 --> 00:38:50,040
Speaker 3: I get to sort of sit you know, Lee, You

769
00:38:50,040 --> 00:38:53,960
Speaker 3: and I probably have very similar like seeing being a

770
00:38:54,000 --> 00:38:57,120
Speaker 3: part of the story, not necessarily being the story, but

771
00:38:57,200 --> 00:38:59,160
Speaker 3: like being able to observe the story and feel like

772
00:38:59,200 --> 00:39:00,920
Speaker 3: you kind of are a part of it, you know.

773
00:39:01,040 --> 00:39:03,040
Speaker 3: I think when we had these big stories, seld On

774
00:39:03,239 --> 00:39:05,759
Speaker 3: was one that I think for us was a sort

775
00:39:05,800 --> 00:39:09,040
Speaker 3: of coming out. We sort of were on the front

776
00:39:09,040 --> 00:39:11,160
Speaker 3: lines of that story and we're continue to report it.

777
00:39:11,440 --> 00:39:14,839
Speaker 3: You know, Yellow's Yallow's bankruptcy last year. When these big

778
00:39:14,880 --> 00:39:19,879
Speaker 3: stories take place, you have so much historical knowledge about

779
00:39:19,880 --> 00:39:23,920
Speaker 3: what's happened in context, and there's a much broader public

780
00:39:24,040 --> 00:39:27,600
Speaker 3: interest in these stories, and I think that's to me,

781
00:39:27,920 --> 00:39:30,560
Speaker 3: that's that's probably the most exciting part of the job,

782
00:39:30,680 --> 00:39:33,440
Speaker 3: is sort of being a part of history in a

783
00:39:33,480 --> 00:39:38,240
Speaker 3: way of providing context that is quite unique because this industry,

784
00:39:38,719 --> 00:39:42,600
Speaker 3: particularly trucking, is a very underreported It's hard to find

785
00:39:42,680 --> 00:39:47,600
Speaker 3: books on Amazon about the trucking industry. The history of

786
00:39:47,600 --> 00:39:48,120
Speaker 3: the industry and.

787
00:39:48,120 --> 00:39:48,840
Speaker 2: How it operates.

788
00:39:48,880 --> 00:39:51,480
Speaker 3: A lot of this is sort of tribal knowledge that

789
00:39:51,600 --> 00:39:54,640
Speaker 3: is kept inside the industry itself and not really something

790
00:39:54,680 --> 00:39:57,919
Speaker 3: that sort of broader public is interested in, and for

791
00:39:58,160 --> 00:40:00,120
Speaker 3: many reasons they shouldn't be interested in it.

792
00:40:00,480 --> 00:40:03,319
Speaker 2: But when you had these stories that I think.

793
00:40:05,200 --> 00:40:08,279
Speaker 3: Really bring a lot of people into it, I think

794
00:40:08,320 --> 00:40:10,879
Speaker 3: that's the most exciting part. You know, my wife used

795
00:40:10,920 --> 00:40:12,719
Speaker 3: to tell me not to talk about freight when we

796
00:40:12,760 --> 00:40:16,120
Speaker 3: would go to like dinners and cocktail receptions because she's like,

797
00:40:16,160 --> 00:40:19,920
Speaker 3: nobody cares. And now that's what people you know, these

798
00:40:19,960 --> 00:40:21,919
Speaker 3: stories happen far more often.

799
00:40:21,600 --> 00:40:23,120
Speaker 2: And people were frankly interested in it.

800
00:40:23,160 --> 00:40:26,520
Speaker 3: So I to me that's probably the most interesting is

801
00:40:26,520 --> 00:40:28,399
Speaker 3: they've got to take all that historical knowledge I learned

802
00:40:28,440 --> 00:40:31,600
Speaker 3: from my father and you know, share it with with

803
00:40:31,719 --> 00:40:33,360
Speaker 3: other people that are in this industry.

804
00:40:33,600 --> 00:40:36,120
Speaker 1: You mentioned there aren't too many books about the trucking industry?

805
00:40:36,320 --> 00:40:39,120
Speaker 1: Are there any books about transportation or leadership that you

806
00:40:39,200 --> 00:40:42,239
Speaker 1: kind of hold close to your chest and kind of

807
00:40:43,440 --> 00:40:46,560
Speaker 1: you know, it really kind of influenced you one way

808
00:40:46,640 --> 00:40:47,040
Speaker 1: or the other.

809
00:40:47,480 --> 00:40:48,279
Speaker 2: You know, I'm a big fan.

810
00:40:48,320 --> 00:40:50,359
Speaker 3: I'm not just saying that because I'm trying to win

811
00:40:50,440 --> 00:40:53,680
Speaker 3: favor of Bloomberg, but Bloomberg, by Bloomberg is actually, to

812
00:40:53,760 --> 00:40:54,520
Speaker 3: me has been.

813
00:40:54,400 --> 00:40:55,640
Speaker 2: Sort of my operating bible.

814
00:40:56,080 --> 00:40:59,520
Speaker 3: Seeing the story of Bloomberg, you know, building a business

815
00:40:59,560 --> 00:41:02,400
Speaker 3: that's built and data and has a media component. You know,

816
00:41:02,440 --> 00:41:04,960
Speaker 3: Bloomberg is the goat of doing this and doing it

817
00:41:05,080 --> 00:41:07,839
Speaker 3: very successfully. You know, media has been a business that's

818
00:41:07,840 --> 00:41:10,319
Speaker 3: been under an enormous amount of pressure. You know, we

819
00:41:10,400 --> 00:41:15,680
Speaker 3: saw layoffs even yesterday, Axios like you know, cut fifty

820
00:41:15,760 --> 00:41:18,799
Speaker 3: some odd people. But we've seen media really struggle and

821
00:41:18,840 --> 00:41:21,200
Speaker 3: that has not been the case for Bloomberg. And I

822
00:41:21,239 --> 00:41:25,239
Speaker 3: think it's interesting to read the Bloomberg story of particularly

823
00:41:25,239 --> 00:41:28,680
Speaker 3: in the sort of foundational days, the struggles of becoming

824
00:41:28,760 --> 00:41:32,120
Speaker 3: credit being viewed by the sort of industry.

825
00:41:31,680 --> 00:41:32,880
Speaker 2: Incumbents is credible.

826
00:41:33,920 --> 00:41:36,120
Speaker 3: I think I relate a lot with because that's been

827
00:41:36,320 --> 00:41:38,600
Speaker 3: you know, some of our struggle at Freightways is some

828
00:41:38,640 --> 00:41:40,480
Speaker 3: of the interesting incumbents have not viewed us as a

829
00:41:40,480 --> 00:41:44,480
Speaker 3: credible source. But that was surprisingly because I look at

830
00:41:44,520 --> 00:41:47,800
Speaker 3: Bloomberg today and it's it's arguably the most or among

831
00:41:47,840 --> 00:41:54,080
Speaker 3: the most credible sources of information in news and particularly

832
00:41:54,080 --> 00:41:57,959
Speaker 3: financial markets, but even broader in things like politics. It's

833
00:41:57,960 --> 00:42:02,480
Speaker 3: interesting how how credible that steam Bloomberg is today and

834
00:42:02,520 --> 00:42:04,279
Speaker 3: how it's shocking to me that there was sort of

835
00:42:04,280 --> 00:42:07,040
Speaker 3: this old boys club that you couldn't enter in those days.

836
00:42:07,040 --> 00:42:10,240
Speaker 3: And I think that sort of maverick mentality that Michael

837
00:42:10,239 --> 00:42:13,040
Speaker 3: Bloomberg instilled inside the brand, I think is something that

838
00:42:13,160 --> 00:42:13,759
Speaker 3: is inspiring.

839
00:42:14,400 --> 00:42:17,480
Speaker 1: Yeah, it's been a fantastic thing to be part of,

840
00:42:17,520 --> 00:42:21,480
Speaker 1: even though you know I joined fourteen years ago, well

841
00:42:21,520 --> 00:42:25,799
Speaker 1: after the founding, but been a great place for me

842
00:42:26,000 --> 00:42:29,799
Speaker 1: over those fourteen years. So, you know, it's interesting. You know,

843
00:42:29,880 --> 00:42:34,839
Speaker 1: prior to recording this, when we were discussing offline this conversation,

844
00:42:35,120 --> 00:42:37,200
Speaker 1: I didn't realize how much you and I have in common.

845
00:42:37,320 --> 00:42:40,400
Speaker 1: You know, we're both kind of bearish on autonomous trucking.

846
00:42:41,760 --> 00:42:46,239
Speaker 1: We're both extremely good looking, and you know we both

847
00:42:46,280 --> 00:42:49,759
Speaker 1: recently went to Iceland. Do you see any puffins when

848
00:42:49,760 --> 00:42:50,279
Speaker 1: you were there?

849
00:42:50,719 --> 00:42:52,840
Speaker 3: I didn't see any puffins. We didn't make it to

850
00:42:52,920 --> 00:42:56,160
Speaker 3: the beaches. We spent our time with the volcanos and glaciers.

851
00:42:56,239 --> 00:42:58,919
Speaker 1: Yeah, okay, we were Any highlights you want to share

852
00:42:59,200 --> 00:43:00,480
Speaker 1: from the chip Like.

853
00:43:00,560 --> 00:43:04,560
Speaker 3: I think Iceland is one of the you know, undiscovered

854
00:43:04,840 --> 00:43:08,600
Speaker 3: or sort of less talked about gems that everyone should

855
00:43:08,600 --> 00:43:08,960
Speaker 3: go visit.

856
00:43:08,960 --> 00:43:10,440
Speaker 2: I mean, it's easy to get to as American.

857
00:43:10,719 --> 00:43:12,680
Speaker 3: The thing that I found shocking about Iceland is just

858
00:43:12,680 --> 00:43:16,600
Speaker 3: how americanized the English is. They understand some of the

859
00:43:16,640 --> 00:43:19,680
Speaker 3: American like even when you go to Europe, even in Britain,

860
00:43:19,760 --> 00:43:23,360
Speaker 3: sometimes the American slang and some of it just the

861
00:43:23,440 --> 00:43:27,640
Speaker 3: lexicon that Americans have, they seem to almost have it instinctually.

862
00:43:29,200 --> 00:43:31,799
Speaker 3: But I found it to be The food was amazing.

863
00:43:32,160 --> 00:43:36,239
Speaker 3: Obviously you're going there to do things that are outdoors.

864
00:43:36,560 --> 00:43:39,000
Speaker 3: It's just a world class destination. I do a thing

865
00:43:39,120 --> 00:43:41,480
Speaker 3: every year where I take my oldest boys, my thirteen

866
00:43:41,480 --> 00:43:45,160
Speaker 3: and seventeen year old. We go to anywhere they want

867
00:43:45,160 --> 00:43:46,760
Speaker 3: to go and we spend a week or two weeks

868
00:43:46,800 --> 00:43:49,839
Speaker 3: just doing it, as we call our boys trip, and

869
00:43:50,040 --> 00:43:52,120
Speaker 3: basically it's just time for me and the boys, and

870
00:43:52,160 --> 00:43:54,839
Speaker 3: that this year was Iceland in the year before last

871
00:43:54,880 --> 00:43:57,600
Speaker 3: year was Japan, and both of those countries I think

872
00:43:57,640 --> 00:44:02,360
Speaker 3: are just amazing places that everyone should should visit. And

873
00:44:03,239 --> 00:44:07,399
Speaker 3: it's just something that I think is these are destinations

874
00:44:07,400 --> 00:44:09,040
Speaker 3: that should be top of everyone's list.

875
00:44:09,480 --> 00:44:11,920
Speaker 1: Right. It's weird they have the trucks where the engine

876
00:44:11,960 --> 00:44:13,680
Speaker 1: over the cab kind of thing for America.

877
00:44:13,719 --> 00:44:16,040
Speaker 2: I'm a big fan of the European cabovers.

878
00:44:16,080 --> 00:44:19,080
Speaker 3: You know, I grew up Lee My grandfather had a

879
00:44:19,120 --> 00:44:22,920
Speaker 3: trucking company built Southwest Motor Freight, and they're all cabovers, right.

880
00:44:23,840 --> 00:44:27,480
Speaker 3: And so it's funny because running a media business, if

881
00:44:27,520 --> 00:44:30,839
Speaker 3: you hire somebody from outside the industry, the instinct they

882
00:44:30,840 --> 00:44:34,799
Speaker 3: have is to pull a when you have photography, if

883
00:44:34,800 --> 00:44:37,239
Speaker 3: you're pulling it from like Shutterstock, using public for these

884
00:44:37,280 --> 00:44:41,839
Speaker 3: public databases, their tendency is to pull a European truck

885
00:44:41,880 --> 00:44:45,400
Speaker 3: because for some reason shutter stock doesn't have American trucks

886
00:44:45,480 --> 00:44:47,160
Speaker 3: and they're always they publish it, and I'm like, that

887
00:44:47,280 --> 00:44:49,879
Speaker 3: is not I remember we started freightways, we did that.

888
00:44:50,200 --> 00:44:52,640
Speaker 3: We had that happen a couple of times with somebody

889
00:44:52,840 --> 00:44:55,160
Speaker 3: was new and they put a European truck on there,

890
00:44:55,200 --> 00:44:55,640
Speaker 3: and man.

891
00:44:55,560 --> 00:44:56,280
Speaker 2: We would get back.

892
00:44:57,520 --> 00:45:00,680
Speaker 3: This isn't this isn't a real truck at American But

893
00:45:00,760 --> 00:45:05,080
Speaker 3: I think are cool. They're much beefier, they're digger, they're taller.

894
00:45:05,200 --> 00:45:07,560
Speaker 2: They're beef heer. I don't know. I'm not a truck driver,

895
00:45:07,800 --> 00:45:10,399
Speaker 2: but that's a truck that I would love to have,

896
00:45:10,719 --> 00:45:11,359
Speaker 2: just as a toy.

897
00:45:11,520 --> 00:45:15,040
Speaker 1: So all right, well, I really appreciate your time, Greig,

898
00:45:15,040 --> 00:45:16,400
Speaker 1: thanks so much for joining us today.

899
00:45:16,840 --> 00:45:18,200
Speaker 2: Thanks Lly appreciate it having me.

900
00:45:18,640 --> 00:45:20,560
Speaker 1: I also want to thank you for tuning in. If

901
00:45:20,560 --> 00:45:23,520
Speaker 1: you liked the episode, please subscribe and leave a review.

902
00:45:23,719 --> 00:45:26,400
Speaker 1: We've lined up a number of great guests for the podcast.

903
00:45:26,719 --> 00:45:30,680
Speaker 1: Check back to hear conversations with C suite executives, shippers, regulators,

904
00:45:30,800 --> 00:45:33,880
Speaker 1: and decision makers within the freight markets. Also, if you

905
00:45:33,920 --> 00:45:36,879
Speaker 1: have an idea for a future episode or just want

906
00:45:36,880 --> 00:45:40,040
Speaker 1: to talk transports, please hit me up on the Bloomberg terminal,

907
00:45:40,120 --> 00:45:43,800
Speaker 1: on LinkedIn or on Twitter at logistics Lee. Thanks everyone,

908
00:45:43,960 --> 00:45:44,520
Speaker 1: and take care.