🎢 The highs and lows of freight

Rise and grind, hustle fam. As tons of dark clouds draw near, there are still beams of hope breaking through the storm! You’ll see, Transfix hit a goldmine during one of the most challenging markets in freight history, while Convoy takes an L and sells off its core technology, plus more. Start scrolling. 👀

Newsletter Highlights

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NEWS

The DPS inspections that began in September, due to the migrant surge across the Mexican-American border, have come to an end. Since September 20, 19,000 trucks carrying about $1.9 billion worth of goods have been held up as a result.

Officials think it will take a few weeks for the long wait times of four hours to drop to the average one hour. American and Mexican officials have deemed the DPS inspections unnecessary because Texas state troopers are not authorized to check cargo trailers.

The Port of Eagle Pass usually has around 850 cargo trucks every day. Though, because of delays in Texas DPS inspections, the number dropped below 400. As a result, trucking professionals have talked to U.S. and Mexican authorities to prevent future safety inspections by DPS.

BUSINESS

Previously valued at $3.8 billion in April 2022, Convoy announced it will shut down operations and sell its technology for only a small fraction of its previous value. In a letter to the remaining staff, Dan Lewis, CEO of Convoy, blamed a “massive freight recession“ and a soft market for the company’s demise.

Since it was one of the first and biggest companies to receive a lot of venture capital funding in an attempt to create a more efficient version of a traditional broker on a large scale, Convoy's closure is a huge setback for the digital brokerage model.

Which raises a bigger, unresolved question: Will the market forces that ensnared Convoy bleed into the larger brokerage industry?

SAFETY

While crossing over I-25, a broken rail caused a BNSF Railway train, that was hauling coal, to derail and collapse onto the highway killing a truck driver on October 15. The driver was identified as Lafollete Henderson, a 60 year old truck driver from Compton, California.

A 9 mile stretch of I-25 was closed as crews cleaned up hundreds of tons of spilled coal and mangled railcars from the roadway. Due to this, examiners are evaluating the 65 year old steel bridge to figure out why warning systems did not alert the crews driving.Closed for four days, the highway was reopened as of October 19, and is now accessible to Colorado residents.

Nonetheless, pressure for the railroad industry to improve safety has intensified since a February derailment, mentioned in last weeks newsletter.

SUPPLY CHAIN

New Enterprise Associates (NEA) and G Squared began a $40 million funding round for Transfix—a digital freight marketplace connecting shippers and 300,000+ carriers.

Transfix has instilled confidence in its investors by, “remaining focused” and “building momentum despite one of the most challenging markets in freight history.” Overall, the company’s leadership and strategy have proven valuable and effective.

They are currently in the Series F funding round phase and this phases role is to strengthen financial positioning, as well as support Transfix onto a path of profitability.

RAILROAD

The Kansas City, Missouri railroad company, MB Rail and Maysville County Port Authority have teamed up to develop a new multimodal logistics facility.

CSX’s Industrial Development and and Real Estate teams selected the facility’s cite and secured a partnership with them. Maysville Rail Port LLC, a company related to MB Rail's Transkentucky Transportation Railroad, will lease it. MB Rail also operates the Youngstown & Southeastern Railroad in Ohio.

“We are excited to get to work at the Port, which is strategically positioned with access to three transportation modes and sits in the heart of the rapidly developing AA-Highway Corridor. It’s the perfect recipe for business growth, and we look forward to collaborating with the Port Authority and CSX along the way.” — Dustin Shaver

WEEKLY RECAP

On October 17 Nina Dittmar, CEO of Marathon mail SVC, INC. sat down with Rahmel in Washington, D.C. She has much experience to share about everything her family, and herself, have learned about the business since 1969.

Nina touches on the business’s 50+ year partnership with USPS, the ins and outs of USPS contracts, the current state of the industry, and much more. If you missed it, click the link above to stay updated!

“Your direction is more important than your speed.

— Richard L. Evans