🎣 Port Strike Suspended

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Good morning. And that's a wrap on the ILA port strike – for now. We cover the details of the tentative agreement in today's feature story.

Also in our newsletter:

• Another round of layoffs at Flexport
• Road and rail hurdles post-Hurricane Helene
• Trucking company owner faces sexual harassment claims
• New listings on freightjobs.co

Feedback: We’d really appreciate it if you could take a 1-minute anonymous survey to share your thoughts on today’s newsletter.

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🐔 WHAT’S COOKIN’ IN FREIGHT

💼 Flexport to Cut 2% of Workforce; Expects Profit. Flexport is reducing its workforce by 2% to position the company for "profitable growth" over the next few years, according to a memo sent to staff on Wednesday. The restructuring merges forwarding and fulfillment teams following the Shopify Logistics acquisition, creating redundancies. CEO Ryan Petersen emphasized the move will accelerate growth, supported by Shopify's $260 million investment earlier this year. This marks Flexport’s fourth round of layoffs in two years; the most recent in January 2024 reduced their staff by 20% (500 employees).

🚧 Rail and Road Systems Struggle Post-Hurricane Helene. Hurricane Helene caused major infrastructure damage across the Southeast, disrupting rail and road systems. CSX and Norfolk Southern report delays due to flooding, downed trees, and power outages in the Carolinas and Georgia. Although some routes have reopened, key areas remain affected. In North Carolina, I-40 West is closed from mile marker 3 (NC) to marker 435 (TN), with reopening projections as far out as September 2025. Tennessee faces severe damage, including five destroyed bridges, with repairs expected to take months. Truck drivers face hazards from damaged secondary roads, so NC-DOT is urging freight traffic to use major highways.

🚚 US Truckload Carriers Predict First Rate Increase in 2025. US truckload carriers anticipate the first rate hike in two years in 2025, driven by a rebound in freight demand and tightening capacity. Despite slow recovery from the recent downturn, analysts expect pricing power to shift toward carriers as excess trucking capacity diminishes. However, Kendra Walker, CEO of Truckstop.com, expressed skepticism at the JOC Inland Distribution Conference, stating Truckstop's numbers do not reflect this predicted trend. The expected rate increases aim to stabilize trucking revenues after a period of pricing weakness, although the exact timing depends on market recovery.

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The Strike Ends: A Quick Resolution to Port Chaos

After just three days, the International Longshoremen's Association (ILA) strike has come to an unexpected conclusion. The strike, which began at midnight on October 1, 2024, affected 36 major ports along the Gulf and East Coasts, including those in Florida, Georgia, and New Jersey.

The ILA had walked off the job, citing demands for significant pay increases, improved working conditions, and protections against automation.

What Was Agreed?

• Wage Increase: The new deal offers a 62% pay increase over six years. That means the average wage would go from $39/hour to around $63/hour.
• Contract Extension: The agreement extends the master contract to January 15, 2025, allowing further negotiation of unresolved issues.

Key Strike Demands:

• Wage Hikes: The ILA initially demanded a 77% increase but settled for a 62% raise. Still, it's quite higher than most labor contracts, as the WSJ points out: "Many U.S. dockworkers currently earn more than $100,000 a year."
• Automation Protections: A central sticking point remains the ILA's opposition to automation technologies, though details on this aspect of the deal are still under wraps.

Timeline of Events:

John Konrad, CEO of gCaptain, provided a well-developed outline of events leading up to the tentative agreement:

• Oct. 1: Strike begins, with the ILA initially holding firm on automation and wage demands. "Up until 14:09 on Tuesday all my reliable sources were telling me the ILA was digging in for a long fight," Konrad tweets.
• Ryan Petersen (@typesfast) of Flexport predicted early on that the strike would likely end quickly by tracking real-time data, such as ship diversions. FreightWaves CEO Craig Fuller agreed with his prediction.
• Oct. 3: Negotiations culminate in a tentative agreement, following pressure from political figures like President Joe Biden and Secretary of Transportation Pete Buttigieg.

Konrad detailed why he held off on calling an end to the strike despite insider information, saying:

"What made me hesitate most was the automation issue and that has NOT been settled. All we got was an agreement on pay and broad strokes for a temporary return to work until that great prize fight is announced. I think this was smart for the ILA..."

Reactions and Public Sentiment

• Political Pressure: Governor Ron DeSantis pushed back and even called the National Guard to ensure Florida ports continued operating, saying, "We have no time for delays."

• Public Backlash: ILA President Harold Daggett received significant public criticism and even death threats, which may have hastened the decision to end the strike.

What's Next?

With the strike ending quickly, attention now turns to the January 15, 2025 deadline, when the contract extension expires. While the wage increase issue has been resolved for now, the most contentious point—automation—remains a critical battle ahead.

The ILA continues to resist the introduction of automation technologies, fearing job loss and reduced labor demand. Negotiations are expected to heat up as this topic remains unresolved, with union leaders likely to double down on protections against AI, robotics, and automated processes in port operations.

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🌎 AROUND THE FREIGHT WEB

🧻 Panic Buying. Before the port strike was averted, people were panic-buying toilet paper, though there was no real shortage since most U.S. toilet paper is produced domestically and unaffected by the strike.

🚛 Sexual Harassment Lawsuit. Norman Waller, owner of Wyoming's Waller’s Trucking, faces an EEOC lawsuit over allegations of repeatedly sexually harassing female employees.

🚨 Migrants Uncovered. Twenty "shivering" migrants were found shivering inside a 30°F trailer after the driver nearly collided with another truck during a routine inspection.

🌀 TQL's Hurricane Relief. TQL and Ohio Task Force 1 are actively aiding Hurricane Helene recovery efforts, providing crucial supplies to affected communities.

👮♂️ Abducted Child Rescued. A 12-year-old girl, abducted across state lines, was found safe in a truck cab at a Mississippi stop; the driver, 35-year old Donovan Taylor, is currently under arrest.

🛑 New CDL Violation Rule. FMCSA’s new rule, Clearinghouse II, mandates CDL downgrades to “prohibited” for drivers involved in drug and/or alcohol violations until they complete the return-to-duty process.

🎣 THE FREIGHT CAVIAR CORNER

• Conferences We Are Attending: F3 Future of Freight Festival in Chattanooga, November 19-21.
• Latest Freight Jobs: See all the latest freight job listings, by clicking here.

• The FreightCaviar Podcast: In this week's episode, we interviewed Matt Silver, the CEO & Co-Founder of Cargado, a new load board for cross-border shipments. Click here to listen.

FREIGHT MEME OF THE DAY