supply chain

Penske Truck Leasing has earned placement on the VIQTORY 2024 Top Military-Friendly Employers list, in the over $5 billion category. VIQTORY is a service-disabled, veteran-owned small business that produces publications like Military Spouse and G.I. Jobs magazines.

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Penske associates across the organization will join today for Penske Pink Out – an associate-led breast cancer awareness event now in its ninth year.

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Tracy Urbanski, vice president of sales for Penske Logistics, has received the 2023 Women in Supply Chain Award from Supply & Demand Chain Executive and Food Logistics. The award honors female supply chain leaders who set a strong foundation for women at all levels of a company’s supply chain.

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After several tumultuous years, the supply chain continues to improve, and shippers and carriers are getting back in sync, according to the 34th Annual State of Logistics Report. Even still, it remains important for those in the supply chain to focus on relationships, efficiency and resiliency amid rising costs and economic uncertainty.

“If the past years have taught us anything, it is that uncertainty is now a near constant in the global economy, and the smartest way to respond in good times is to gather resources for when conditions suddenly shift again,” according to the report, entitled The Great Reset.

The Annual State of Logistics Report is produced for the Council of Supply Chain Management Professionals (CSCMP) by the global consulting firm Kearney and presented by Penske Logistics.

In 2022, the market swung back sharply in shippers’ favor, and supply and demand largely rebalanced across all transit modes. However, Balika Sonthalia, a partner with A.T. Kearney and co-author of the report, said it is important for companies to take steps to remain the shipper of choice because the pendulum will eventually swing. “We’ve seen this before, and carriers will remember how you treated them,” she said.

Sonthalia added that third-party logistics providers are continuing to provide valuable guidance to shippers. Before the pandemic, logistics was often considered a side function, but it has continued to gain attention and is now widely seen as a strategic differentiator. “Companies look at 3PLs less for pointed solutions and more for strategic partnerships to run certain flows soup to nuts,” she said.

Overall Costs and Trucking Capacity

Those partnerships are increasingly important as companies work to manage costs and capacity. Costs have increased, with overall U.S. business logistics costs rising 19.6% to $2.3 trillion in 2022, compared to $1.85 trillion last year, representing 9.1% of the national GDP — the highest percentage of GDP ever. It also marks a 46% USBLC increase between 2020 and 2022.

Plus, transportation costs reached $1.39 trillion, up from $1.3 trillion in 2021. Road freight, the most significant segment of U.S. logistics expenditure, increased to $896 billion from $844.5 billion in 2021.

Road freight saw little change in overall demand, but capacity increased throughout 2022. Sonthalia said the dry and load-to-truck ratio — a figure calculated by dividing the total loads by the number of available trucks — is at the lowest it has been since June 2020, which is a signal of the level of capacity available in the market.

As a result of shifts in capacity supply and demand, there was a greater spread between spot and dry rates than in previous years, according to the report. From January 2022 to January 2023, the spot rate dropped 23%. The changing dynamics caused shippers to seek a new balance among dedicated, private and one-way services.

Resiliency and Near Shoring

Sonthalia said costs have always been a factor in supply chains, but resilience has become a top priority, which is leading to more diversification and reshoring. “I think we’ll see more diversification by volumes. As that happens, your origin for shipments changes, and there is an entire ripple effect,” she said, adding that U.S. companies have been moving supply chains closer to home. The report noted that American imports of Mexican manufactured goods grew 26% last year.

Visibility is an essential tool when increasing resilience, Sonthalia said, explaining that having visibility into inventory lets shippers make strategic decisions to pivot quickly if a disruption occurs. Technology can provide the necessary visibility to increase resiliency while helping reduce costs.

According to the report, 3PLs are investing heavily in their technology offerings, with respondents reporting that 96% of 3PLs have migrated to the cloud compared to 86% of shippers, and 80% of 3PLs are investing in Internet of Things technology compared to 77% of shippers.

Other Key Findings:

  • E-commerce sales remain strong. In 2022, the U.S. e-commerce market grew by 8% to $1.03 trillion compared to $871 billion in 2021, constituting 14.5% of the entire U.S. retail market.
  • U.S. parcel market costs increased by 4.7% compared to 2021.
  • Motor carrier costs grew 6.1% year over year. The report noted that carrier margins were threatened by low rates and higher resource costs.
  • Class 1 railroad costs increased 17.6% year-over-year. Railroads saw operating income increase by 8% and total revenue increase by 14%. However, rising costs undermined operating ratios, and the sector suffered from service-related issues, ongoing congestion and high-profile derailments.
  • Air freight costs increased by 1.7%. Worldwide air cargo revenue is projected to reach approximately $150 billion in 2023, 25% below 2022 but still 50% higher than the pre-COVID revenue figures from 2019.
  • Domestic water costs increased by 18.4%. Major ocean liners saw combined global operating profits of $215 billion in 2022, but the trend has lost steam, and 2023 profits are projected at $43 billion, an 80% year-over-year decrease.

The full report is available to download here:

With a month until the official start of the Atlantic hurricane season, now is the time to get ready for potential storms, as preparation is key to keeping you and your property safe.

National Hurricane Preparedness Week, April 30 – May 6, provides an opportunity to review your safety plans and make any changes long before a storm arrives.

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Inflation, supply chain issues and increased labor expenses are driving up the cost of maintenance for Class 8 tractors.

“The entire industry has experienced cost increases, and we are no different,” said Chris Hough, vice president of maintenance design and engineering for Penske Truck Leasing.

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In today’s world, nearly every aspect of daily life is made possible because a truck driver delivered the goods and resources people need. And as our world faced unprecedented challenges throughout the coronavirus pandemic, it was our resilient and committed truck drivers who kept our businesses, grocery stories and hospitals stocked with the essential items needed to keep us safe.

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As the world faced unprecedented and uncertain times over the past two years, truck drivers helped hospitals, medical offices and stores stay stocked with the essentials needed to stay healthy and safe.
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The Commercial Vehicle Safety Alliance (CVSA) will conduct its annual Brake Safety Week from Aug. 21 -27 with a focus on brake hose/tubing chafing violations.

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Long backlogs and supply-chain constrained production have limited new Class 8 truck availability, extending equipment lifecycles throughout the industry. A strong maintenance program is always critical, but it is becoming even more important as trucks are remaining on the road longer.

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Commercial motor vehicle inspectors will be out in force May 17-19 across North America as part of the Commercial Vehicle Safety Alliance’s (CVSA) International Roadcheck. This year’s focus is on wheel ends.

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In the third annual State of Sustainable Fleets Market Brief, released today and available at no cost, transportation fleets continued to report a resounding trend — their use of clean fuels and advanced vehicle technologies is rapidly progressing. Report title sponsors are Daimler Truck North America, Penske Transportation Solutions, and Shell Oil Company. Cummins, Inc. is a supply chain sponsor of the report.

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Catalytic converter theft has skyrocketed in recent months as organized groups of thieves continue to illegally cut these devices out of cars, SUVs, and rental trucks at an increasingly alarming rate.

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As a child, Michael Kegerise marveled as adults recalled his family's legacy of military service, which predated the Civil War.

"I always knew I would regret not serving in the military, so I enlisted while in college," said Kegerise, enterprise facility services project engineer at Penske's corporate office in Reading, Pennsylvania.

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Market forces, shifts in demand, labor challenges and port congestion continue to stress the supply chain, but those within the logistics industry are working to clear backlogs and keep products moving.

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The next few weeks will mark the most dangerous and active period of the Atlantic Hurricane Season, making hurricane preparation even more vital for fleet managers and others.

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Penske Truck Leasing has debuted a facility in Romulus, Michigan, near the Detroit Metropolitan Airport. With an address of 37750 Northline Road, the location offers full-service truck leasing and contract truck fleet maintenance services.

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With Tropical Storm Zeta expected to strengthen to a hurricane before striking the Gulf Coast, truck fleet operators are encouraged to take steps now to brace for the storm's impact.

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