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A
The purpose of the data is to give you, to equip you to actually turn it into action, not something you stick in a file cabinet. The objective is to actually make you step back and think. So if there's one thing that you can do with the information, it's actually, as Chris said over and over, look, it's about using it to better prepare yourself for what you believe the actions might need to be to allow you to keep your supply chains agile and relevant, quite frankly.
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Welcome to Supply Chain now, the number one voice of Supply Chain. Join us as we share critical news, key insights and real supply chain leadership.
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C
From across the globe.
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B
One conversation at a time.
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C
Hey, good morning, good afternoon, good evening wherever you may be. A Scott Luton and Supply Chain hall of famer Jake Bar with you here on Supply Chain now. Hey, Jake, how you doing?
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A
Today we are ready for another edition of what do the numbers Tell Us?
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C
Because the data doesn't lie. Is that right?
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A
It does not lie.
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C
Folks, stick around. We've got a terrific, terrific show here today as we conduct a special edition that's a D D I T I O N by South Carolina Spelling as we continue a long running quarterly series, really a popular informative series that we get a lot of feedback around. But we're diving into the inaugural US Bank Freight Payment Index Rates edition. So it's a new quarterly publication that provides valuable freight market information on drive van spot rates, contract rates, fuel, average cost per mile rates, whole bunch more, including important economic context and perspective, which one of my favorite parts. And we invite you just like you see there on the screen. Download a copy, follow right along and want to get your feedback on the data because it doesn't lies. Jake has spiked the football on. Want to love to hear your take. Now it's really important to note, Jake, the rates edition along with today's conversation is going to help supply chain professionals better understand what's going on in the freight market so they can make better, better informed decisions in the weeks and months ahead. And this terrific resource is a joint project delivered to the market by two data powerhouses. It's like Hulk Hogan and andre. The giant US bank who processes more than $43 billion in freight payments annually. And DAT Freight analytics who has an incredible database of more than $1 trillion in freight market transactions. It's free to access, y' all. Check it out, download it. Jake, we've got a big show here today, huh?
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A
Absolutely. And you're correct. You got the two powerhouses, world champions.
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C
As the folks used to say back in the day from three syllables, A two. So let's bring in our one two puncher today. Jake, in addition to your perspective, which is extremely valuable, Bobby Holland, director Freight business analytics at US Bank. And another hall of Famer, Dr. Chris Capless, chief scientist with DAT Freight and Analytics. Hey. Hey, Bobby. Welcome back. How you doing?
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D
Doing well, how are you?
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C
Wonderful. Great to see you. And Chris, great to see you here today. Welcome to supply chain now.
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E
Thanks. Great to be here. Scott. Good to see you again, Jake.
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C
We have been ready to go on this one. Jake, are you ready to dive in first with a fun warm up question because it's football playoff time.
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E
You ready, Jake?
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A
Oh, I'm ready to be punished because these guys have teams still in the playoffs and I don't.
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C
They do. So Chris, I want to start with you a little fun warm up question. As I've learned in the pre show programming, you spent a lot of time in Boston, sl, Cambridge and New Hampshire. And you're a longtime, passionate New England Patriots fan. So I gotta ask you two part question. Your favorite Pat's memory in recent years and is New England gonna win it all this year?
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E
Yeah, you know, I don't have one favorite Pat's memory. All the duck parades that we've had up here in Boston has been an embarrassment of riches over the last 20 years. To be honest. Like they all blur, you know, so many championships, so many rings. But this year, gosh, I hope so. Drake May is just doing a great job. Drake, Drake May, May. He's fun to watch. So it's nice to see football being exciting back up in New England again.
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A
I just heard, I just heard, blah, blah, blah. Okay, I'm just saying you gotta fix your speakers there.
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E
You need that.
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A
Chris, Chris, just thank the Titans for giving you a coach again. There we go.
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C
If y' all can't tell everybody, Chris and Jake make go back a decade or three. We'll see a lot, a lot of great exchanges coming up and Bobby switching gears. And by the way, Chris, I'm. I'm very jealous of your trophy case there with the Patriots. We're trying to get our first here in Atlanta. We'll see.
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E
But don't forget the Red Sox, the Bruins and the Celts. A whole package, the whole pack.
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C
Very familiar. There he goes, Bobby. Now Bobby, your Denver Broncos are two wins away. Big games, but still two wins away from reaching their first Super bowl since 2016. So is this going to be year they play for it all, Bobby?
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D
Well, I'm just an honorary member of The Denver Broncos fan club. I used to live there, so I kind of haven't really qu. My full membership yet. Yeah, I don't think they're going to make it all the way. No, but I'm only halfway across the country from everybody that heard me just heard me say that. So.
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C
You're out of arm's reach, Bobby. I like well, so we'll see. I tell you, I missed the John. John always got a great new documentary on Netflix, folks. Go check it out. All right, so Jake, Pat's fan, Broncos fan, lots of playoff football. What's your take, Jake?
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A
I have a feeling that the Pats are going to be in the super bowl, and I have a feeling it won't be against the Bears. How's that?
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C
All right, that's. That's a fair and safe bet. We'll see how it plays out and we'll dive into a lot more future supply chain now shows for sure. All right, so we got a lot to get into here today and I want to start with some a little bit of level setting. Chris, it's great to have appreciate all your work at industry. Great to have you here today on supply chain Now. So if you would tell us a little more about DAT freight analytics than of course, everybody but maybe three people out there know and your role there, Chris.
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E
Yeah, sure. I think everyone on this call knows dat. It's the powerhouse. It's the largest data and analysis firm in the truckload market space that what people might not know is that we don't just do have products for shipper for carriers and brokers. We also have a huge portfolio of products for shippers. That's where I really came in from the Chainalytics acquisition in 2020. But the hallmark of DAT is the massive amount of data that we have and the benchmarking, forecasting and other marketplace services that we provide to really make the entire market more efficient.
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C
Outstanding, Chris. The best get better. That's kind of what I heard a theme in your description there. One more thing really want to encourage folks amongst all the great work Chris is doing industry. I love the Freight vine podcast. I think you're soon to be Publishing episode 165. So you've been at it for a little ways. Love the great work. Your most recent episode was with Kevin's Wire.
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E
That's correct.
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C
Yeah. So folks, check out Freight vine wherever you get your podcast, including Apple podcast, of course. Okay, Bobby. Today we offer six year of collaborating to help inform supply chain leaders of what's going on in the domestic freight markets and helping them harder make, make better, faster, more confident decisions. So two questions for you. We'll start with the first one, if you would, about the U.S. freight Payment Index for folks out there that may may still be behind things.
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A
Okay.
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D
Well, the U.S. bank freight payment Index is our primary viewpoint, our representation of the market, the truck freight marketplace. It's informed by more than $43 billion worth of payments last year numbers for 20 anyway, it's in that, it's in that ballpark.
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C
Right, right, right.
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D
Minus. But the point is we have a huge amount of data and we want to like you said, enable our subscriber base to at least have some more data points as they look to make the right business decisions in this marketplace. And this is how we present it. Love it.
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C
And as y' all saw there, if you're tuned in and watching us, I love the overarching but also the region by region views. And Jake, really quick before I continue on as we get Chris and Bobby to weigh in on this new edition, the Rates edition, the Value. Jake, speak to the value of the Freight PIM Index.
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A
Look, the site, as we all know, the supply chain is in a new world of never normal. And as a supply chain leader, you've got to be able to take advantage of ingesting as much information you can around not only what the marketplace is doing in total, but then layers of that because your business has many layers to it. So fundamentally having both of these operations provide perspective is really crucial because you've got to be able to to make progression projections about the day to day operations where the shortages, the impacts are going to have and especially from a cost perspective.
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C
That's right. Well said, Jake. Someone been there and done it for sure. All right. So Bobby, today of course we're diving deep into the brand new rates edition of the index. It's going to bring a lot more value to these quarterly releases that have really y' all gotten a lot of feedback from the market around. Tell us how this came about and what's unique about this supplementary edition.
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D
Well, we have a partnership with, with DAT that's growing and as part of that partnership we thought that. Okay. In the Freight Payment Index, our main publication, we often talk about spot and contract rates and how they're either affected by or how they affect the truck market space. And so we thought that it would be, you know, again in the interest of providing more data points for our consumers that if we met with the we're arguably the number one freight payment, freight item payment provider partnering with DAT that we could shed some more light on. Again, the effects or the effects or impacts of rates in the marketplace. Again, we mentioned it in the Freight payment Index and this is more of a more focused on the rates only and not the general, broad or regional market space. We try to be informative.
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C
Yes. And y' all do a good job there. Chris, what would you add to the rates addition here?
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E
Yeah, mainly just echo what Jake and Bobby said. What we're doing is combining the expertise and reach of two powerhouses and experts in there in their areas and bringing those together. And it's really nice to see the combined effort of that really give a holistic picture of the market.
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C
Oh, well said, Chris. We're going to dive into all of that. Bobby, Chris and Jake. And again, folks, you're going to find a link to download your own copy, spill coffee on it if you like to print it out. If you're a hard copy guy like I am sometimes mark it up, dog ear, you name it. But we'd love to get your take on it all, Jake, before move on and we get into the national picture and what the story is and some data points. Anything you'd like to add about the value you see, as someone that's been in industry leadership circles for quite some time about what this Rates edition will bring to the table, I want to.
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A
Underscore what they've already offered up. But more importantly, if you even just looked at your baseline graphic or what you put onto the screen, even an average supply chain leader, I hate to say it this way, but Chris and the rest of them, they've got the understanding of this. If you go vertical by vertical or a subset of what categories categories and what companies you're dealing with, whether it's a Fortune 50 or Fortune 200 or a Fortune 500 company, there's a large disparity between how well prepared folks are and what I call delivering standard operating practice of how much is really a contracted basic carriage and how much is spot market to blend and bridge to what you've got contracted. And that could be by region, it could by could be by type of transportation, et cetera. So you get yourself exposed a lot to being potentially hit by, you know, needing to rate buffer, as I call it, to close those gaps because you don't have a robust enough overall transportation strategy or you haven't done enough scenario analysis to understand, hey, we're really exposed in this segment. So this is great to help quantify and provide a light to folks who haven't done that work yet.
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C
Flashlight, mag, light. Love that, Jake. Well said. Okay, so let's do this. I want to get Bobby and Chris to weigh in. I've got the lead graphic. Bobby first. At a high level, just the data points themselves, this is going to look a little different than the regular quarterly freight payment index. Just kind of unpack what we're looking at here first. Bobby.
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D
Yeah, what we've got here we're showing again the spot, contract spot and contract rates for, and the fuel rates per mile for dry van. And the reason we chose to focus on dry van is because that's the bulk of the data that we receive from dat. And so it has the clearest signal as far as, you know, gauging the impacts and like I said, how they're impacted by the marketplace. So what we see here is it's interesting to see that contract rates were pretty level, which is what you would kind of expect. There's been minor variations, there's been more variation in the spot rates, but from a low in October, pretty good rise in November and then dipping again into December. But the interesting thing to note is if you look at the volumes that supplier, that provision, these numbers, we can see that the both rates remain pretty, pretty up there for what they are on a lot less volume and part of that seasonality. But part of that is continuing to paint a picture perhaps that capacity is still tight and costs are high being passed on to the shippers.
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A
Yep.
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C
All right, so Chris, we're going to get into what the data is telling us at a national level in a minute but before we get there, because I want to do some, some, some foreshadowing there. Chris, just react to what we're measuring, what we're capturing here, your take on, on, on its value. What else would you add to what Bobby shared?
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E
Yeah, I think what the data that you have here really reflects the breach that DAT has. The contract rates are coming from shippers and what they pay for the contract rates, the spot rates are actually what the broker pays for that. And this is really important to see how the broker buys versus how the shipper buys because as, as Bobby was saying, spot rates are much more volatile. They're the canary in the coal mine. Seeing how they're being procured in the market is very helpful because that gives you a leg up on what happens. It's usually about a three to four month lag. But what we're able to show here is not just contract rates in this, but show the, the leading indicator which is really spot rates and below that we have the numbers. Numbers don't lie. We're telling you exactly the numbers that we have in terms of, of contract and spot. We have a ton of contract rates, but we're the only real provider of all of those spot rates. Like I said, that's the leading indicator in this market.
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C
Chris, really appreciate you putting a, a fine point on the pencil there. Probably messed up that analogy, but you know what I mean. Jake, what would you add, especially on the value of any canary in the coal mine and being able to kind of get a sense of where we're going, the future, what's around the corner, Your thoughts?
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A
Jake I'm already choking on the data. That's the canary in the coal mine. I'm already looking ahead and as a supply chain leader, I'm going, I don't like that picture.
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C
And the data doesn't lie, folks. We're going to keep hammering that home throughout today's session. So let's do this. We're about to get a better sense of what this first snapshot, all the data and economic industry insights are telling us. But before we do, I want to share just a couple of data points from across industry. Nothing's going to surprise this panel and nothing's going to surprise, I bet, the smartest audience all of global supply chain. That's our supply chain now, Global fam. So let's do this. First, as reported by manufacturing dive, the ISM Manufacturing PMI shows that the manufacturing industry in the US contracted at least according their data for the 10th straight month and finished with its lowest reading of 2025 in December. Now there's a little bit of good news. Perhaps there were signs of life with positive movements and new orders, backlog of orders and new export orders. But the flip side, the jury's out. That's just like a little blip or the start of a little bit of little bit. Give me a little bit of momentum. We'll see. Secondly, on the consumer spending front, the National Retail Federation data shows that total retail sales in November and December 2025 grew month over month as well as year over year. I'll take it. Inflation maybe had a little role there. And finally, as a Rates edition mentions, according to Transportation Insight and the fmcsa, more freight carriers are exiting the market than entering. You can, you can see it right here by comparing the net carrier revocations and the new carrier authorities from the fmcsa. So Chris, I want to come to you now that we've got an understanding of what the Rates Edition shows. And now we've got some of the things we're looking at nationally and regionally, nationally. What's all this telling us? What's the story here, Chris?
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E
Yeah, so we all lived through the pandemic, but it's hard to believe the pandemic has been over for four years. So it's crazy. We still have that in our memory. We saw the rates go up, we saw the rates crash. We've been in a trough for the last two and a half years. And what we're seeing in the data in this report, as well as what we've seen over the last six to 12 months, is it's a slowly, we're slouching towards recovery. And to Jake's point, how you feel about this market depends on where you sit. If you're a carrier or a broker, you're saying happy days are finally coming. The market's tightening up a little bit. If you're a shipper, you know, you had your day, it's going to be tighten up, but it's not going to be a sudden peak. It's going to be a slow grind above equilibrium. We're seeing the market tighten, but not dramatically.
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A
I'm looking for the defibrillator already.
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E
Oh, come on, come on. This is Nothing compared to 2020-2022.
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A
Oh yeah, but see, I, I was already in. I was dead, declared dead three times during that. And just bringing it back, you know.
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C
Every time you were golfing, then every.
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A
Time, every time you came back, the rate shocked you back into it.
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C
Yeah, we know. I love that phrase, slouching towards recovery.
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A
Right.
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C
And also Chris mentioned that. Hey, the shippers, hey, had you had your days. We'll see where we go from here. Bobby, I want to get you to also tell your story of what you see here across this, the rates and the data and, and things going on in the marketplace. What are your thoughts there, Bobby?
- [19:17]
D
Well, like I said, the contract rates have been steady. As we quoted in our document, it says that perhaps it gave carriers and shippers, you know, some time to, to figure out their next moves. But again, the biggest thing to note is just how markedly the volumes dropped, but the prices did not.
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A
So that's.
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D
And for all the reasons that, you know, our data sees the same thing that Chris and Jake brought out about carrier capacity is tight. It used to be driver shortages, now it's expensive drivers. Again, the stuff that's happening with the driver's licensing, a lot of stuff. And then of course, tariffs are always still lurking in the background, they've kind of leveled out as far as the volatility, but they're still there and they're still impacting. So there's a lot of variables in the marketplace that are impacting, which is why it's kind of good to see this view of rates.
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C
Yes, good stuff, Bobby and Chris. All right, so Jake, I want you, I want to get you to comment as well in the story. But first, I got to give you a little credit, Jake. Bobby mentioned tariffs. Some folks were looking at yesterday of what the Supreme Court would do, and you were right on Monday, Jake, you said the Supreme Court's not weighing in on, on Wednesday. So I got to give you a, a victory lap first, Jake, and then tell us your take on the story here that folks should pay attention to.
- [20:37]
A
Well, I mean, Bobby and Chris just unpacked a bunch of stuff there, but you know, the also, let's not forget the data doesn't lie, as we said. But you dropped some trinkets and some nuggets on some corresponding information around the manufacturing index, a few other things. So realistically, in one way, this is a kind of a corollary to what Chris was talking about. Hey, you had your day as a shipper. Well, guess what? I had my day as a shipper. But if manufacturing in the US Continues to contract at its current pace, that's going to put even more stress on fewer shipments to pick up. But actually, to the contrary, with the what's happening from a consumer spending standpoint and at least a number of categories, you're getting an increase in actual freight movements. Right. So you. It's a juggling act. Right. That's why we depend upon these guys to be able to do it, because I don't want to use my old Magic 8 ball to make the choice.
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C
And Chris alleged you spent all your time in supply chain on the golf course. That can't be the case. Right.
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A
That's just not true. But that's okay. I'll get him back. All right.
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E
During the pandemic.
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C
Oh, gotcha. A little, little clarification. Okay. All in good fun. Okay, so let's get into. There's so much. So we could be here for hours and we got the right panel to do that for sure. But what are some of the most important regional observations, Chris, or just other call outs that folks got to be as in shippers in particular got to be aware of?
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E
Yeah, the report itself calls out a couple things about increasing the Northeast and effects of the Southeast. But I think what's really happening over the last month. We're seeing a really more rapid rise in spot rates, especially for temperature control coming out of Southern California or out of the Northwest. And a lot of this is due to agriculture. The spot rates are definitely increasing up. Contract rates are staying steady when they're being adhered to. But spot rates, you're going to see 30, 40% increases for many different reasons. Holiday weather but also some other situations with English language proficiency, non domicile regulations being more enforced. Those areas are much heavily populated with drivers that are at risk for that. Nationally we won't see as much of a of an impact, but regionally we could see large localized impacts.
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C
And Jake, this is something we were talking pre show for us prompt Bobby, your thoughts, Jake, on the impact to drivers in certain regions of the country.
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A
It's as Chris said, it's extremely volatile at the moment. I mean now they're I, it's almost we're playing whack a mole. Right. If we end up having an impact of well, we, we're deploying ice to certain parts of the country, there's a little bit of a delay but as Chris outlined, wait, we've got drivers that don't want to go to certain places. Right.
- [23:34]
C
All right, so and Chris, I'll circle back in case there's anything else you want to share. We're going to get some fearless predictions. We're going to get some predictive advice for actions that supply chain leaders should take as well. So folks, stick around. All right, so Bobby, regional observations or any other call outs, that specific call outs that our viewers and listeners should really be taking note of?
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A
Sure.
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D
When we looked at the treasury data in conjunction with what we're seeing in the DAT rates, it's kind of been alluded to but in the Northeast has slightly stronger outbound volumes due to manufacturing and uptick in retail activity. I think that was also shown in the slides that you put up. The Southeast has a weaker job market and softer consumer spending so that kind of balances it out. And then we also have issues in the Midwest with cross border traffic as well as refinery issues which kind of helps explain some of the fluctuations in fuel rates and fuel prices.
- [24:35]
E
Yeah.
- [24:36]
C
All right, so good stuff there, Bobby. I think Jake, Jake, you're pretty accurate with that whack a mole analogy as a kid that went to showbiz pizza all the time and lost at that game all the time that there's some supply chain relevance there for sure. Chris, before we get into talking about some actions that supply Chain leaders should take given everything we're talking about here today. Is there anything else? I know you've got, you've got your finger on the pulse like few do in this industry. Is there anything else you'd like to call out, Chris?
- [25:05]
E
No, I think some of the charts that you showed the carrier authorizations, how those are declining, everything that masks some things. What we're really seeing is that a lot of the larger fleets have been shedding their over the road, random freight. They've been shifting to dedicated because dedicated is more profitable. You see, it exceeds the amount of contract one way over the road where volume that's out there. So we're seeing a shift also from what's being considered for contracting going over there. So are there fewer drivers? Sure. We're seeing capacity decrease a little bit for some of the reasons that Jake was saying as well, but not to the level that I see a sudden really contraction that's going to drive rates up. I see again a slow, steady equilibrium because we've been below market for a long time now.
- [25:52]
A
Yeah.
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E
And the spot carriers can't go any lower in those, in those regions.
- [25:57]
C
Jake, I think what, whatever Dr. Chris Kaplan says, I think that's pretty good to take to the bank. He's been doing this for a little while, huh, Jake?
- [26:05]
A
No, he's completely spot on on that.
- [26:07]
E
I couldn't, I think Bobby's the bank. I'm not, I'm, you know, I'm just saying.
- [26:12]
C
So, Chris and Jake, specifically for y', all in these next two questions, when you think, Chris, of actions that supply chain leaders should be taking, given all the things we've talked about, the data driven insights, it's not lying to us. What comes to your mind that you'd like to share? Not just from a shipping perspective, but also, you know, a general business planning perspective.
- [26:35]
E
You got to understand for shippers, they're people who have been buying transportation. They've been accused of crying wolf for two years now. This is the third cycle because we all thought the market would turn a little earlier and it didn't. We thought this time last year was definitely going to turn. And then the tariff carousel came out and every seven days a new tariff changed. We've gotten better at that. We're absorbing that and we're understanding that tariffs really aren't affecting the volume as much, mainly changing the ports of origin. So what I would say what shippers need to do is build their base, make sure their house is ready and just get those sustainable relationships for when the market does turn because it will turn. It's not like you know we have memory here. We've seen how these It's a very cyclical market. Get ready for it. Build in your base, get your asset based carriers in your collection of non asset based and be ready for when the market does turn. Repair your roof now before it starts raining.
- [27:27]
C
I like it Chris. And don't. And build out of bricks. No straw. Build that bases that now Jake, I don't want to put words in your mouth. We were talking pre show. You're talking about you know, level loading and, and leaning less on spreadsheets, more on modern innovative technology, scenario modeling. Touch on some of those things and what other actions you think supply chain leadershippers and general business leaders should take.
- [27:51]
A
Yeah, I mean to Chris's point those are just incredibly accurate statements on what you should be doing and unfortunately it's shame on you if you didn't learn from pre pandemic and pandemic situations to where you actually needed to be doing some of that get ready work of saying hey, I'm going to analyze all my freight moves. I'm going to set up more dedicated loops. I'm going to be a little more selective in how I build out the network to involve some partners so I can add more contracted loops and I'm going to add the scenario analysis that allows me to think about if I've done my prep work of building a bit more agility of how I'm able to flex my manufacturing processes because if I can stabilize I don't need to have a huge peak next Wednesday or the following Tuesday after that I can literally level my my way out and work it even with my contract relationships with a lot of my distributor retail partners.
- [28:57]
C
Good stuff there Jake. Lots of practical perspectives. My favorite parts about these conversations. You know Chris, I'm going to start with you here. What are a couple of developments that supply chain leaders should keep their eye on right in the months to come, weeks to come, months to come. Your favorite cadence there or do you have any bold prognostications other than the Patriots winning it all again this year?
- [29:18]
E
Yeah, sure. I mean so I think just keep on on track of how things are moving. Keep your eye on the spot markets, not just the my vera all in driving and still look at the the spot mark for temp control because they all influence each other. And so the big thing that I would tell this for shippers is that un, you know we see this uncertainty in the market but a lot of the uncertainty is self inflicted the planning department doesn't always talk to marketing, doesn't talk to transportation. A lot of times transportation, especially the procurement and execution are the flea on the tail of the dog. And so a lot of this uncertainty that the, that shippers face when they're procuring transportation and having all this, this really volatility is self inflicted. And so I would highly recommend you talking to your marketing teams. You know, we get hit in the face with promotions we didn't know about and Suddenly you need 12 trucks today out of Albuquerque. And so the whole idea is work internally and that'll help reduce some of the uncertainty and volatility you see in the market.
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C
Chris? I think that is a very sound prediction of what's to come because it's timeless, Jake. As old as the notion of communication is, we still stink at it oftentimes. Jake. But.
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A
Well, I'd use a different word for it. But yes, you are correct. You're correct.
- [30:37]
C
So Chris gave us a little bit of predictions and what you can do about it in the months ahead. Jake, what are some of your prognostications of what we might see?
- [30:46]
A
Well, I'm going to prognosticate for you that a number of the largest tariffs are going to be ruled illegal and then you're going to have to bounce and you're. By the way, that doesn't mean they're going away there. Portions of those are going to come back in different forms because the administration has already signaled that it is going to take different actions. Right. Now what does that mean? If you're a shipper and you're in a transport side. I'm sorry guys, but we don't pick up a plant and move it on 24 hours notice. So even if tariff has changed, right. We're still going to have a flow of goods. Now what we may do is we dramatically change the pricing of those goods, right? But we also have goods that are in, in flight, in movement, right. In trucks. Because transportation is all about moving, right? So fundamentally this is one of those. Shame on you if you haven't already started playing the what if games and the scenario modeling of how you're going to pivot and shift. I may pivot and move stuff to again, another state, another country, et cetera, et cetera. Right? I'm going to change suppliers, right? I had two principal suppliers for packaging materials or a key ingredient and they were from different regions of the world. I made pivot. Guess what? We don't have the teleporter from Star Trek yet. So you've got lead time. You're going to have to so it's otherwise called hey, the emperor is going to be naked if you haven't gone in and already done your pre work. So if you if you're waiting for that magic eight ball to give you the answer, you're too late.
- [32:30]
E
Yeah, that's Jake, that's 100%. And in fact shippers need to and they most of them have the four corner strategy for imports. So I have stuff in the northwest, the northeast, south and the Gulf was the fifth fifth corner. So if you don't have your sandbox built, you don't have flexibility in real time. So you got to build that ahead of time to have real time flexibility.
- [32:50]
C
Billion dollar advice here from the panel. And folks, Bobby can perfectly predict the future, but fiduciary regulations prevent us from getting his own thoughts with those questions. If y' all been watching this show for six years, you know that already. And Bobby, you but you were going to comment on something I think Jake or Chris said just a second ago. Did I miss something, Bobby?
- [33:09]
D
I just said these guys are killing it with these metaphors. They are.
- [33:13]
C
You can tell they've been around. They have done some things together in their time in industry. I'm going to have a little bonus question here Jake and Chris, and if you don't want to weigh in on it, it's related to the many any potential manufacturing pulse that a lot of folks have a lot of different predictions from the reshoring impact to tariffs to whatever lots of different takes out there. And of course we shared a minute ago where one set of data shows that the manufacturer the US Manufacturing industry has been Any comments, Chris, any predictions? Just any observations on what 2026 may mean from a US manufacturing activity perspective?
- [33:55]
E
Yeah, sure, it's a little bit out of my area of expertise but you know, I have a PhD so I can have an opinion on everything. So I agree with Jake. If you suddenly have a tariff that says, you know, it doesn't make sense for me to produce something in this certain place that could go away. What we saw was that these tariffs, they're negotiating standards, they're not tariffs, they're negotiating ploys. So no one's going to make a billion dollar 100 million investment on something that could go away in three weeks. And what we found is we've done a study up here at mit. We're looking at the tariff elasticity. If I raise the tariff on a certain goods in a certain country, we can measure what the decline is going to be, but it's going to go somewhere else. It's not like we're going to suddenly not be demanding these things as a consumer in the us it's just going to come from somewhere else. And if it stays in Southeast Asia, it's probably still going to come through the west coast port.
- [34:46]
C
Right.
- [34:46]
E
Some might come to east coast. So it's really not going to, in my opinion, change the amount of flow coming in, maybe points of origin coming into the country.
- [34:54]
A
Right.
- [34:54]
E
But I don't see massive investment changes being made on a tariff that could change at the drop of a hat.
- [35:01]
C
Chris, I love it and I wish we could, I wish we had a couple more hours with you because you should have opinion and I love your comment about PhD. I can have opinion on anything. Anytime you want to talk manufacturer or supply chain. Chris, you come on back. Jake, I want to pull one thing out that Chris mentioned because I just saw a headline, I think it was yesterday, talk about lip service, about what tariffs would do versus reality. I think China has had a banner year in exports as they strengthen relationships around the globe. So we'll see, yeah, we, we'll see where, where that leads. But Jake, your thoughts on manufacturing activity, what we might expect rest of the year?
- [35:36]
A
Yeah, I'm going to back up the truck on a couple of the comments Chris made because while he, he says he's, he's really the master of transportation, which he is, by the way. Chris has deep broad supply chain knowledge. So fundamentally, here's one thing that I think we're also cemented on. You don't make a knee jerk reaction on $100 million to a billion dollar investment around a physical plant structure and infrastructure just because somebody says well guess what, we pulled it, we changed our mind, we're not going to have the tariff today. Well, wait a minute. A few weeks ago and a few months ago that's what we said. Right? So here's what I know to be true and what I see happening across all the US manufacturing base. Companies that were reticent to actually invest more in further process automation have now leaned into it. So what are they doing? They are trying to provide an ability to up their agility gain by further automating some sub processes. Now that's not just robotics, okay? That's material handling investments and a number of other things. And that is happening across the board. So it's going to be a great year for the investments in further process automation and decision automation fronts. As it pertains to what you were Saying though it's got around physical footprints, that's just simply. I'm sorry, you're smoking dope. If you think there's going to be major, major. Wait, we just pulled the tariff and now we're going to build in a billion dollar factory? No, we're going to, it's going to require a period of stability.
- [37:28]
E
And to add to that, Jake, suddenly if manufacturing jobs came, talk to anyone in manufacturing and there's a labor shortage.
- [37:35]
A
Oh, there is.
- [37:36]
E
I mean it's across the board, you can't find it. And our immigration policy is not making that easier to be honest. So I agree with Jake 100% that all the investment is going into process improvement, whether it's gen AI for service process or actually automation. It's changing the game and making people be more flexible in real time.
- [37:56]
A
It's putting a premium back on. As you and I've talked on other episodes around upscaling of the workforce because yes, wait a minute, the workers I had when we're talking, when Chris and I are talking about labor short wait, I actually, I could use the people I have, but I actually need to have them have if I'm going to do this automation work. They need more skills than they had before.
- [38:22]
C
Right. I wish we keep this conversation going. I've got a quick follow up question. What signals are you following that indicates the tariffs could be deemed illegal? Jake? And by the way, Chris mentioned how they're more negotiating ploys perhaps than anything else. I think there's a lot of truth to that. Jake, what else would you add? What leads you to believe that they're going to be deemed illegal?
- [38:44]
A
Well, this is where as a supply chain professional you've got to have members of your team that are alcoholic duty rates and tariff specialists as well. Right. So I, I had a number of them on my team and so I stay in constant contact with them. And there's a broader alcoholic fraternity of folks that do that work but they know every tariff act, every government reg and they can point to hey, they're going to pull this off, but they're going to try and reinsert either this act or this act which would allow this subcomponents and these set of ingredients and materials to still semi be tariffed instead. But it's going to be called a fee structure instead of a, it won't be called the same. Now there's still legalities around whether those will stick.
- [39:32]
C
Right.
- [39:32]
A
But the point is, and what Chris and I were getting at a few minutes ago is wait a minute. I'm not going to make a billion dollar investment just because we're playing whack a mole.
- [39:45]
C
Right. So true. And to your point, both your points and some of the things Bobby touched on, there's been various mega projects come to a crawling stop, including a couple here in our home state of Georgia. We're tracking. Okay, Chris, I think you were going to add one more thing and then we're going to, we're going to circle back to Bobby, make sure. But no has that knows how to connect. What are you saying, Chris?
- [40:08]
E
Yeah. So this is a really good example of when you can use the difference between effects and events. There's a lot of events that can happen. Tariffs, pandemic, fire, whatever that can cause where you can't get material from a certain area anymore. And so instead of focusing on predicting all these different events that can happen, think about the effect. And the effect is I can no longer source from a that country products not coming from China. So I need to build in the flexibility to be able to react to that.
- [40:36]
C
Yeah.
- [40:37]
E
So it goes all back to being able to set your strategy and be prepared to be dynamic and fluid and agile in real time. Yeah. And you got to prepare for that ahead of time, but you don't need to prepare for one future. Be prepared to be agile.
- [40:51]
A
Chris and I have hung out with a guy named Yoshi Sheffy for too long.
- [40:55]
C
Too long. Another hall of Famer. Build that base. Build that base. As Chris said earlier. Love that. Love that final piece of advice too. So let's do this. Bobby, we have, I'll tell you, we brought the right panel here today. Bobby, I'll tell you when you're, when you publish all of this wealth of data, your teams between U.S. bank and DAT Freight Analytics. But it leads to these types of discussions, right? And versions of these discussions and supply chain organizations and meeting rooms or you name it elsewhere. Bobby, that's got to be fulfilling and really rewarding to you, huh?
- [41:31]
D
Yes, it is. It's like, I'm gonna put my metaphor out there. It's like inviting people to the party and then being happy when they show up.
- [41:38]
C
It's so true. And then they start dancing and enjoying the food. So a lot of good stuff there. So Bobby, let's make sure we're. Again, we're showing the Rates Edition. You're gonna find these rates, these tracks, these graphs on top of the new Rates Edition supplemental piece to the US Bank Freight Payment Index. So Bobby, how can folks find it and subscribe to it? We got the Link right there. Is that just that easy?
- [42:03]
D
Bobby it's that easy. Same as the free payment index. It's freight usbank.com so it's just that come your email, your email.
- [42:12]
C
And hey, we want to hear from you. Let us know. I know that both teams here would love to get your take, constructive criticism, positive feedback, you name it on this new rates edition. So let us know. Dr. Chris Kaplus I'll tell you what, no wonder you've got a podcast and you approach 165 episodes because I think we got a little snapshot of the value of freightvine. And folks, we encourage you go check out Freight vine wherever you get your podcast. How can folks connect with you? Chris and the DAT Freight analytics team?
- [42:43]
E
Yeah, just reach out. Just Google dat. It'll pop right up. But again, if you're a shipper, look at our freight and analytics benchmarking. If you're a broker, we have so many tools out there for you and as a carrier as well, the load boards and other DAT1 applications, just go to dat.com and you'll be overwhelmed with the stuff that we can do for you.
- [43:05]
C
Outstanding. A lot of good stuff. And congrats on y' all's continued growth and innovation. Chris okay, so Jake Bar, you get probably the toughest question of the day. I'm not envious of you because you know, Chris and Bobby and all the data that we we've dove into the last hour, it can be not overwhelming, it's not right. But there's a lot to digest. What is your key takeaway here today?
- [43:28]
A
Jake hey, the, the purpose of the data is to give you, to equip you to actually turn it into action. Not something you stick in a file cabinet. The objective is to actually make you step back and think. So if there's one thing that you can do with the information, it's actually as Chris said over and over, look, it's about using it to better prepare yourself for what you believe the actions might need to be to allow you to keep your supply chains agile and relevant.
- [44:03]
C
Quite frankly, outstanding actionable discussion here today, folks. That's one of our hallmarks. And I tell you, Bobby, Chris, I can't wait.
- [44:12]
A
I can't wait to tell the two of them actually download themselves and we, we ingest them into a large language model where we're actually having. I can query at any time, any permutation. Hey, I want to see the breakdown of the freight index, but in a subset. And I want you to exclude the information so that all I'm looking at is this piece that's coming out of these line it. They can do it.
- [44:38]
C
Well, I'm looking forward to that day too with Bobby and Chris, but also jealous of your tariff and compliance community. I'd love to plug into that group. I want to bring those in on maybe a future episode. Jake. We'll see.
- [44:50]
A
Oh, that'll require a cocktail party.
- [44:52]
C
Okay. All right, folks, I wish we had more time here today with this outstanding panel. We promise you quite a one, two punch and I think we've delivered. And again, really valuable. And my favorite part is actionable. Right. Doing something with this data and the insights is critical. So I want to thank everybody here, starting with Bobby Holland, director Freight Business analytics at U S Bank. Bobby, I love what y' all have added to the Freight Payment Index and the partnership between these two data powerhouses between U S Bank and. And dat. And we're going to check in on that party you're building next time you join us, Bobby. Okay.
- [45:31]
D
Excellent.
- [45:32]
A
All right.
- [45:33]
C
And good luck to the Broncos. Okay. Dr. Chris Capless, Chief Scientist and Hall of Famer at DAT Freight analytics, also fellow podcaster, got his finger on the pulse of global supply chain like few do. Chris, I look forward to having you back on soon. And I've really enjoyed your expertise here today.
- [45:51]
E
Anytime, anytime, Scott.
- [45:53]
C
All right. And of course, Jake Barr, the one only Jake always appreciate and I love. I'll tell you what, you and Chris, I bet you I've got some stories that you probably can't share, but maybe after these shows we'll try to get into more of that too soon. But great to have you here, Jake.
- [46:08]
A
Thank you.
- [46:09]
C
Big thanks. Amanda and Trisha and all of the gang behind the scenes helping to make production happen. Joshua, big thanks. Tell you what, we stand on the shoulders of giants around here. But folks, I can't encourage you. Hey, go check out the rates Edition of the U.S. bank Freight payment Index and let us know what you think. We'd love to get your feedback. And most importantly, folks, you heard that the data doesn't lie. But better yet, good spin there. Done that expertise, perspective, you waste it if you don't do anything with it. So that's your homework. Take one thing you heard here from Bobby, Chris and Jake, share it with your team. Do something with it. These not words. That's how we'll keep navigating these disruptive times. And with all that said, behalf, on behalf of the whole supply chain out team Scott Luton challenge.
- [46:54]
D
You do good.
- [46:54]
C
Give forward. Be the change that's needed. And we'll see you next time right back here on Supply Chain Now. Thanks, everybody.
- [47:01]
B
Join the Supply Chain now community. For more supply chain perspectives, news and innovation, check out supply chain now dot com, subscribe to Supply Chain now on YouTube, and follow and listen to Supply Chain now wherever you get your podcasts.