Speaker 1: 0:07

Hey everyone, welcome back to DAS Delivered. I'm your host, trucking Ray, and I'm excited to have a returning guest on the show, one of the sharpest minds in the freight world, dean Croke. It's awesome to see Dean. Recently back at Mid-America Trucking Show in Louisville, we caught up, saw this absolutely beautiful truck it's amazing to see in person, and Dean also had some key speaking engagements at Mets that I know brought a lot of value to drivers and couriers. Today we're going to dive into the impact of tariffs and freight strategies and surviving the freight downturn Now that that can help truckers thrive. Whether or not it's the right time to start your own trucking company, we're all going to figure that out together here with Dean, so let's get rolling. Dean, welcome to the show. Thank you so much for taking the time out and meeting with me again here about a lot of the new things that people are dealing with.

Speaker 1: 1:07

So, how are you doing?

Speaker 2: 1:09

Yeah, good, I've been traveling for a little while. I've had a couple of weeks at home. You mentioned Mid-America Truck Show. That's such a huge event for anybody that shows a truck. It takes a good month to get any truck ready for that event because you've got to fix everything you know like after. The tough part about mats is you're coming out of winter, right, and like the week before I left for mats, my truck was covered in snow in Boston and even though I don't drive it on the roads in winter, the salt is still in the air and it damages the stainless. So I admire the guys that show their trucks, that win awards, because every single square inch of those trucks are just spotless. So it's a big deal. I love it every year. Good to meet a lot of people caught up with you. And then, of course, we had all the speaking events, which was really good. I feel like we're getting more drivers engaged in the educational side of the truck show each year, which is good to see. Yeah I.

Speaker 1: 2:12

I really enjoyed it myself too, getting a chance to speak and tell my story about how I got started and a lot of the things that uh come up for podcasting. Um, you know other people can join in, they can get involved, so yeah, um get their voice heard and also help so many people, so yeah.

Speaker 2: 2:29

I love it. We're in the era, aren't we, of information age. There's so much information out there. I think a lot of our podcasts started during the pandemic, when we were sort of all at home and finding ways to communicate with people. A lot of it stuck and there's some really good podcasts out there, especially for drivers. Right, I think there's a lot of drivers that don't have, you know, a hardwired, serious xm unit in their truck. They, you know, and they're crossing multiple time zones. Podcasts are a great way to rack up in advance and queue them up on your iphone and just listen to them as you drive yeah, yeah, it keeps the mind occupied.

Speaker 1: 3:05

I think that's a thing that happens with trucking your mind can just go because you've got the time. You definitely have the time.

Speaker 2: 3:12

We talked about it on the previous show. I think we talked about sleep. Right, my advice is always, you know, be careful what you listen to, because some shows can put you to sleep, some music can put you to sleep, some music can put you to sleep. I always say pick the most annoying person on radio and listen to them, because that'll keep you awake yeah, yeah, you had a lot of great advice.

Speaker 1: 3:32

A lot of people, uh, they really, they really got engaged with the sleep, yeah, the way that you can, you know, set your patterns, um, and really didn't give it much thought before.

Speaker 2: 3:45

Yeah, so that was a lot of difference, right, it's huge because it it helps determine how you think about your business, how you set rates, you know how your mind works, how you focus on costs like. Sleep is absolutely critical to running a truck business, not just from a health perspective but how you think about your business, because absent good quality sleep you you kind of miss the important things. You know you put off what you should do today to tomorrow and you're not thinking clearly about the decisions you make. You know you make bad decisions and you do more of them, so sleep's important.

Speaker 1: 4:20

Right, it's crazy. If you feel that happening, you just got to take a step back and reevaluate what's most important for you. Yeah, yeah, crazy time to be in freight. Huh.

Speaker 2: 4:32

It's a crazy time to be in the freight business.

Speaker 1: 4:34

Isn't it, man? What do we do? You know the tariffs and the freight industry on the downturn. We're hearing that there's a lot of chatter lately about the tariffs, international trade shifts. Can you break that down?

Speaker 2: 4:49

Yeah, ray, it's a really tough time because we were just clawing our way out of a freight recession. You know, the last couple of years have been really tough for most carriers. 2024 was a real grinded-out year and there were signs that in December and January and then February, rates were improving. Now they weren't improving much, but they were certainly heading north instead of south when you average them out over time not the daily fluctuations, but the average was improving. Truckload demand was improving, there was some really good economic indicator signs and then, of course, course, tariffs came along and kind of torpedoed all that confidence we had in the market.

Speaker 2: 5:30

Some really important data points started to turn negative. Ata truckload tonnage index dropped about one and a half percent. The ACT research truckload demand index dropped about four and a half points in March. Our tonn had started to drop in March. So all of the data points that put loads on the back of the truck started to suggest we were what was recovering from a recession actually turned negative at the end of the first quarter and, as you know, first quarter is always the worst quarter of the year, and March though, kind of you come out of March and it sets you up for the second quarter, which is always the strongest of the first half of the year, we enter April in really bad shape and April's not delivering the sort of volume that we would normally expect. Worse, there's a real wait-and-see attitude adopted by all of our shippers the majority of our shippers, I should say. And then on top of that, ray, we've had this extraordinary amount of truckload volume moving to try and avoid tariffs, which is even worse because we've already moved the freight that we would have been moving later in the year. So you know, I'll give you an example of a truckload carrier I've got that pulls a Conestoga up in Hamilton in Ontario and it moves it into the Ohio River Valley. They had their best January, february, march ever in 30 years hauling coil out of Hamilton, and that's of course to try and beat any possible impact of tariffs on Canadian imports.

Speaker 2: 7:01

So when you move that much volume in the first three months of the year, what do you the first three months of the year? What do you do for the rest of the year, when the shippers have already got double the inventory they would normally hold? And then, on top of that, demand falls away because the whole economy starts to tank. You could see a scenario where some of these shippers have got too much inventory, not enough demand, demand. Then they've got to cut their prices and sell product but the cap, the freight's been hauled, and I think that's what worries me the most, especially on the dray side. So anyone in warehousing uh, wholesale warehousing, logistics, 3pls in any port dray carriers in particular they're going to get really, really hit hard because the trade war with China remember China's about 30 to 35 percent of our container volume every month that comes into the US, but it's 50 percent of the volume in Los Angeles.

Speaker 2: 8:00

So 50 percent of the containers that arrive from overseas in Los Angeles come from China. It's essentially been shut down. Here we are at the start of May and the number of ships coming across the Pacific Ocean are dwindling down to and they'll be down to almost zero shortly, but you normally get. So, as of last Friday, there were 37 ships due in the next 10 days in Los Angeles. The prior week it was 55. The prior week it was 71. So we've almost dropped a half in two weeks. These are the number of ships coming across.

Speaker 2: 8:40

So why is this a big deal? People say, oh well, containers aren't everything. Well, here's the thing. We've got such an integrated global supply chain, about 30% to 40% of those products in those containers end up as inputs into other things that we make in domestic manufacturing. That goes on the back of our trucks. So when you start to take that volume out of the market because of a trade war which was largely unnecessary, based on how we look at things now, you start to tank truckload volumes down the road.

Speaker 2: 9:14

It's already happening. We're already seeing layoffs. Volvo announced a big layoff for people at their factories this morning. We're already seeing lots of wholesalers and retailers across different industries Tariffs on steel and aluminum come into effect this morning. We're already seeing lots of wholesalers and retailers across different industries Tariffs on steel and aluminum come into effect this week.

Speaker 2: 9:30

So even if it all went away today, right, and the president said we're back, you know we'll just forget about it Nothing, nothing ever happened. It's still going to take us six months to recover from this, because when you lose trust in negotiations, when it comes to global trade negotiations, when you lose trust, it takes a long time for it to come back, and I think the sentiment is from a lot of shippers and manufacturers is we don't know what's going to happen next. So everybody has sort of said, okay, not knowing what's coming, we have to pull every lever that we can to mitigate our costs. So large companies that put loads in the back of our trucks and on our flatbeds have retreated to their respective corners and said we need to cut back, we need to pull all our stops out to try and cut costs in the event that this gets worse, even worse, that something changes and we make a change and then it changes again, and then there's a new tariff or a rollback. So when you have that level of uncertainty, what that means for us in the freight business is less volumes and it takes longer for it to come back, because people don't trust us as a trading nation. That's loud and clear. That's not an opinion, that's a fact. When you listen to how people talk whether it's the Prime Minister of England, germany there's a real trust issue. That's going on right now, and for truckers that just means less certainty in our freight market.

Speaker 2: 11:04

It's very hard to predict where this is going to happen. I don't know anybody that knows where this is going to land. What I am seeing, though, is that freight volumes are starting to drop. Already. We had a very busy first quarter. People were moving a lot of freight around. Rates weren't horrible, weren't good, but now they're starting to trend down. The spot market, though, is when I say rates, rates, generally. There is some opportunity out there, though, but you've got to be in a pretty good position to take advantage of that. So, generally, the outlook is pretty negative right now, as we start May.

Speaker 1: 11:34

Wow, is there any hidden opportunities in this mess? I mean, maybe there's some certain freight lines or that would actually grow because of the tariff changes.

Speaker 2: 11:47

Yeah, I think you're going to see. We're already seeing a lot of lanes change. So if you think about origin-destination pairings like Atlanta to Phoenix is an origin destination you're seeing a lot of them change. So as shippers try and source inputs from new markets if they were buying from Mexico or they were buying from Canada, they're trying to find a supplier here in the US what you're seeing is new markets, new origin destination pairs pop up as a shipper finds a new supplier in a new city. So there's opportunity there. But you've got to be right on top of that and be prepared to take a risk and run a new lane right, because that means lack of familiarity, new lanes, new partners, new brokers, new everything and maybe new costs, more costs. You've got to play that game and figure out if it's going to be viable. So we're seeing a lot of that happen in the market. So I can't say there's one lane in particular, although anything outbound from Mexico is probably going to be a safe bet because there's a lot more volume going to be coming in from Mexico.

Speaker 2: 12:57

Totally opposite on the northern border, because those volumes are drying up because you don't have a free trade zone like you do on the southern border. The southern border's got a 25-mile free trade zone where a lot of freight gets drayed across the border and goes into warehouses. You don't have that on the northern border. You have interstate carriers, both US and Canadian, running back and forward across the border doing long-haul work. So it's a very different market. So you're going to see cross-border volumes, I think, essentially dry up on the northern border because there's going to be a much bigger push for intra-Canada. So if we've got any listeners that are within Canada, you can expect more intra-Canada work as the Canadian economy looks for more opportunities within their own country. We'll see the same here as I just alluded to and I think you'll see pretty healthy volumes on the southern border. But again, you've got to be prepared to run non-traditional lanes because people are going to be sending freight to all sorts of different origin-destination pairings.

Speaker 1: 14:01

Any warning signs that you can tell something's changing?

Speaker 2: 14:05

Maybe get some out there yeah, um, produce season I'm really worried about, um, you know we're all cutting back here. In april we normally get into peak shipping season in produce. Produce is one of those markets that generally lifts the entire freight market off the bottom. I'm seeing some really ominous warning signs out of California right now. California is the bellwether for the produce season. Right, If you look at California, year over year their volumes are down 30% last week, 30% last week. Now it's a late start and I'm not sure why just yet. So year-to-date volumes are down 33%. So that means the first four months of this year, compared to the first four months of last year, we're seeing 33% fewer truckloads of produce coming out of that market. Lettuce is down 26%, strawberries down 26%, broccoli, cauliflower, tomatoes, cabbage all down in the high 30s. So now, why is that? I don't think it's weather, right, so it's not a weather factor.

Speaker 2: 15:19

The only thing I can really point to is lower consumer demand. We are buying less Now that's a true statement across a lot of different things that we put in the back of our dry vans and reefers. I'm worried that our changing consumer patterns and lack of confidence in the economy and job layoffs and all of those things that come with this trade war end up causing people to buy way less than they would normally buy. So I'm particularly worried about produce season not delivering the sort of volumes that you would normally see lift, dry, van and reefer off the floor in April. So normally you get to the Vidalia onion pack date on the 15th of April. That's the official starting line of the produce season. Then you see strawberries and peaches and all sorts of stuff come online.

Speaker 2: 16:09

In the south we're seeing Mother's Day opportunity, Mother's Day shipping out of Miami. Starting this week it doubles. We see double the truckload of flowers come out of Miami this week and next leading up to Mother's Day, because 90% of all flowers that we give to mothers on Mother's Day come out of Miami because they come from Ecuador and Colombia. So opportunity, yeah, get yourself to Miami if you've got a reefer and you know plenty of spare belts in case you blow one and a reefer motor that's in good shape. I know a lot of brokers won't use reefer motors that are more than 3,000 hours, so you've got to have pretty good equipment to run that product. So again, I mean that shouldn't be a surprise to anyone in that business. Anyone in the produce business has got to have pretty good equipment to run that product. So again, I mean that shouldn't be a surprise to anyone in that business. Anyone in the produce business has got to have pretty good equipment. So, yeah, there are some opportunities, right, but I think they're going to be fewer and far between.

Speaker 1: 17:15

This is something that people are going to fight over. You know more and more.

Speaker 2: 17:20

I said on a show last week. You know I said the emphasis this year is going to be on cost control. You've got to control what you can control. I know you talk about that a lot, but you've got to control the costs that you can control, because there's going to be so many things that you won't be able to control this year, notwithstanding seasonality, like I mean things that you would bank on happening, probably not going to happen this year, just like we saw during the pandemic, because nobody really knows what's going to happen with the market this year, both the broader macro economy and the freight market. But I would do one thing and that is give yourself a rate increase by slowing down. Right.

Speaker 2: 18:02

I see too many guys out there driving the wheels off their trucks like trying to get somewhere in a hurry man. 75 to 65 miles an hour is a mile per gallon. That'll put seven to eight cents a mile pay rise right right there and then like that's a, that's a 20 grand a year difference, just a 10 miles an hour. I know it's counterintuitive and and I and I get you know I've been a hard, fast truck driver all my life. I get it. But in markets like this. You've got to be really disciplined and try and save costs wherever you can, because the revenue on the upside won't be there.

Speaker 2: 18:37

This year You're going to see fairly flat freight rates the rest of the year across the board. There will be opportunity in some markets. I'm not saying there isn't opportunity, but generally you know the analogy the rising tide lifts all boats. The sinking tide is probably going to sink everyone at the same time here, because the freight market is going to be very depressed. On top of that, we still have excess capacity that entered during the pandemic. By our count, we still have about 8% more trucks in the market than we did before the pandemic. Yet rates are about where they were before the pandemic started. So we've got a lot of capacity. I just looked at this week's numbers of carriers that joined and left the market. This is going to blow you away, ray. We had seven. So far as of the 28th of April, we've had 7,000 carriers leave the industry, but 7,000 carriers join. Give or take 10 or 20. It's insane.

Speaker 1: 19:41

Wow.

Speaker 2: 19:42

So where some see misery, others see opportunity, and I guess that's the beautiful part of this free market that we're in Right. Wow. So where some see misery, others see opportunity, and I guess that's the beautiful part of this free market that we're in Right. If you can get yourself a good bit of equipment or, you know, a good V8 Dually with a 5-litre Cummins and a 40-foot RGN, you're in business.

Speaker 2: 20:01

I think there's a lot of carriers that are hauling part loads. There's a lot of carriers that are hauling part loads. There's a lot of hot shots. There's a lot of straight trucks with lift gates doing final mile. I think there's a lot of opportunity in that smaller consignment space, because that's been the growth market in the last four or five years is, as big warehouses have moved closer to big populations, you've seen a lot more short haul metro, regional work in smaller configurations. So that's one of the things that's stuck from the pandemic is a lot more part loads, because on our load boards we see a lot more part loads shippers unable to fall a 50 fill a 53 foot van what about auto parts?

Speaker 1: 20:42

um, I hear there's rumors out there where they're. They're going more so toward the dry van, putting three cars in. You know, they fold them over from the mirrors in yeah just give me that a very low rate to get them transported.

Speaker 2: 20:53

absolutely right. I think you're going to see all this, all sorts of stuff. Um, you know, I wonder about how many people have been charging shippers full load rates and sticking it on a, on an rN with a hotshot for a fraction of the cost, like I think we're about to see some pretty wild stuff in the market as people try and survive. This is one of those extraordinary times If we don't see this trade war go away and of course we've had a 90-day pause I think it's through July on tariffs on all countries. But the trade war with China is probably the most damaging because we are so tightly integrated with that economy as it provides so many more inputs into other parts of our manufacturing processes.

Speaker 2: 21:40

I think the trade war with Canada and Mexico could be damaging for the cost of vehicles. That's a big issue, you know. You look at economies built around Windsor, ontario, across the river from Detroit. You know they're just building a multi-billion dollar bridge, the Gordie Howe Bridge, to facilitate free trade between the two countries. Canada's paid for that to try and avoid the other bridge I can't remember the name of it the Ambassador Bridge, the privately owned Ambassador Bridge, because it's so time-consuming. They're about to open this new bridge, that course now becomes questionable in terms of the value it adds because so many auto parts are manufactured in Windsor Ontario that go backwards and forwards across the river there between the two lakes.

Speaker 2: 22:31

So I think that auto parts is a big, big sector that's going to get damaged by this. I really worry. Then you could go to exports and say what happens to exports of pork out of the Midwest to Oakland, california. Poultry is one of the big exports out of Savannah. You know a lot of carriers will run refrigerated dray work into that port. What happens to that? So this is sort of this isn't just going to affect one sector, it's going to affect everybody.

Speaker 1: 23:00

Wow yeah, I mean the freight downturn and the recovery time.

Speaker 2: 23:04

I mean I don't know that the tariffs are going to go away and just kind of drop that. You know you kind of look out further than four years. Where do you see this going? I mean, I know things have changed in the past. Maybe we can give some people some hope light at a lot of the pandemic when we didn't know what we didn't know right, we didn't know what was coming at us during the pandemic. And of course now here we are not knowing Like we have doubt.

Speaker 2: 23:35

I think the bigger problem this time around is there's no safety net from the government on the backside of this. Right, you know tax cuts don't help if you're unemployed. Back side of this right, you know tax cuts don't help if you, if you're unemployed. Like there's this, you know the the trade war is going to have so much damage on the economy if it continues because a lot of people are going to be put out of work and, uh, you know that's going to affect the trucking industry. So it takes a long time for that to recover.

Speaker 2: 24:02

As we speak right now, at the start of may, a lot of companies are reluctant to lay people off in big numbers because they know if the current administration changes its mind then they'll have to pick back up again. And they know from during the pandemic, when they laid people off, they lost a lot of people. They never came back. And I think that's what people are worried about is that if we lay people off and I think that's what people are worried about is that if we lay people off and then suddenly the amount of tariffs on China go away completely, then we're back to this big surge again and we need people and we've got to ramp up our volumes and production to make up for what we lost, because that's what Chinese factories are trying to figure out. Do we shut down, do we close off? If things pick up again, then there'll be a surge, then there'll be more demand, then there'll be a shortage of containers, then there'll be a shortage of spots on ships and then container rates will go through the roof again. So everybody's caught in this real vacuum right now, where they really don't know what move to play other than retreat to their respective corners.

Speaker 2: 25:04

And I think you could look at this in a couple of timeframes. I think if this is a short-term trade war, we'll see a surge in imports, a restocking, that'll. You know, by three months we'll be back to normal. But if this is extended, you could say this could take us a year for companies that are moving their production to Vietnam, india, mexico before things start to stabilize. You know freight volumes will gradually normalize as trade flows stabilize, but that's going to take a long time. Worst case scenario we're 12 to 18 months before this market fully recovers because there's a real whiplash effect, like there's a ripple effect through all these supply chain when you start to have this amount of destabilisation. And the problem is we've never seen anything like this. This is unprecedented to see such a trade war across so many different fronts on a supply chain that's been highly integrated across multiple countries for decades for at least two decades.

Speaker 1: 26:05

Yeah.

Speaker 2: 26:05

And people have invested billions of dollars in warehouses in Mexico. European companies, chinese companies, australian companies have invested billions in Mexico because it's a great place to build warehouses, they've had land, they've had good labour costs. It's an easy transit, relatively speaking, across the border, although it's delayed right now because the Border Patrol are, you know, searching every truck two or three times, looking for fentanyl and all sorts of nasty stuff. So you know, I went into Canada last week, ray. I was shocked when I crossed the bridge they were pulling over every single truck, every truck was pulled in. So you cross, you go through customs and then you're heading. Shocked, when I crossed the bridge, they were pulling over every single truck, every truck was pulled in. So you cross, you go through customs and then you're heading down the road into ontario and they are stopping every single truck. Now they weren't just checking trucks going into canada from the us, they were checking trucks heading to the border into the us, both directions. They had the Highway Patrol, the MTO, the CBP. There's a full-on assault going on on the trucking industry to try and find all of the bad actors right and the people trafficking people and trafficking drugs. So even cross-border flows are slowing down because of this, more so on the southern border side because that's where most of the illicit drugs are coming from.

Speaker 2: 27:28

So I think there's been a lot of investment. That's hard to move and I think for a lot of people that you know built their businesses around reasonable margins. Tariffs kind of evaporate those margins for them. So whether you're a, you know, I talk to a person that sells strawberries out of Hamilton in Ontario to the Florida market. Their margin's less than 25%, their profit margin. That wipes them out. They've been doing this for 30 years. So there's a lot of people that have built businesses on free trade. You know, nafta was 1994, I think our free trade agreement rewritten as the USMCA touted as the best trade deal ever a few years ago. Now it's suddenly not and the problem is that a lot of people built businesses around that, around free trade. Now that's all been upended. And of course we have our Canadian friends that are very angry about this and have said uh, when I was in canada it's obvious, when you walk around the supermarkets they have what's made in america, what's made in mexico, what's made in canada, clearly labeled on every item, clearly labeled. So it's easy not to buy american products. If you're in canada, so they've taken this very personally and if you know Canadians, they're a very proud people. They're about to go through an election.

Speaker 2: 28:53

I think this week or today, maybe it's even this week, I think Lots of change, and I think these are some of the times that things change forever, like there's been changes during the pandemic that haven't come back. We talked about where opportunities are. People moved warehouses close to people, you know. So the whole freight task chains. We're seeing a lot more day cab trucks, a lot more straight trucks, a lot more final mile deliveries, because that changed, that never went back to the way it was. So there are things that are happening now that I think anybody thinking about joining the trucking business you have to have your, have your game face on, because change is going to be rapid and inevitable. I think you could say is it a good time? I think it's always a good time if you know what you're doing, but if you're prepared to take a risk, you've got to be prepared to risk everything to do this, because there's no certainty anymore.

Speaker 1: 29:53

They're looking into other countries. What about Africa? Or something like that I mean.

Speaker 2: 29:58

Who is this? Sorry, I missed the start of the question.

Speaker 1: 30:01

No, I'm sorry. So some people are looking into other countries or continents, like Africa, trying to figure out where maybe they could pull from a different resource or set up somewhere else.

Speaker 2: 30:10

Oh yeah, yeah, non-tariffed countries.

Speaker 1: 30:13

India.

Speaker 2: 30:15

You know, apple bought in 600 tons of iPhones in January, february, march, on six air freighters, six 747s, to get ahead of the tariffs. So India is big in apparel, big in electronics, big in pharma. So I think you'll see countries like that. There'll be new trade deals done that will take time for those trade lanes to open up. So, yes, there will be other countries, but that's assuming they don't get tariffed also. So that's the also right. So that's the challenge, right.

Speaker 2: 30:52

What if we suddenly find another non-Chinese country and we bring imports in? Then we're back to square one and, of course, that's what happened from 2018 to 2019. China moved a lot of its factories to other countries not called China and then they imported them into Mexico, into warehouses and they cross our border as Mexican products. But they were really made in China. So there's something like else that happened with other products. Um, I don't know. I don't know where this lands, how this ends. Um, I just can only sort of call it as I see it, but right now nobody really knows what this is going to end. Like, because trust has evaporated. Like, how do you make a corporate decision on what to invest? Like, invest billions of dollars and put jobs on the line to change something that might be changed again next week, and I think that's where the frustration lies with a lot of people is they don't know what they don't know and they're reluctant to make a decision because it might be the wrong one by the time we have dinner tonight. That's the problem.

Speaker 1: 31:57

I was thinking some of the big companies like Walmart, target, home Depot met with President Trump to say, hey, I don't know, we're having a hard time here.

Speaker 2: 32:08

Yeah.

Speaker 1: 32:09

I don't know if you saw that one too. That was quite an interesting story to read.

Speaker 2: 32:12

Yeah, they're all adjusting their forecasts down. Some of the big truckload carriers had earnings calls last week and they're all talking about they're worried about sales, they're worried about revenue, they're worried about their. You know they're adjusting about sales. They're worried about revenue, they're worried about their. You know they're adjusting their earnings forecast. Even the truckload carriers were talking about, um, how that all of the momentum they had from the first quarter kind of evaporated. Um, the market is going to be flat. They're not seeing much improvement in rate increases for the rest of the year, low single digits. Um, but more more so was the uncertainty, not knowing. So you're seeing truck orders tank.

Speaker 2: 32:50

Um, you know, and that's that's forcing up used truck prices because low mileage used trucks are now in demand as people are buying fewer trucks new trucks out of factories. It's because the new trucks out of the factories get flipped into the used market at 300,000 miles and if big companies are buying fewer of those, fewer of those are getting sold into the used market. What you end up with is used trucks have a higher price, especially the low-mileage ones. So yeah, this is a really tough time. I think if I was entering the trucking industry right now, I'd be finding a niche, some sort of niche in the market have some equipment that's highly specialised. It would be very, very hard to differentiate yourself if you've just got a tandem axle 53-foot dry van. Not a lot of joy in that, unless you've got some contract work that's really lucrative and you've got a good shipper or a good partnership. But if you're in the spot market 53 foot drive-in that's you've been pretty competitive space right there I was thinking, uh, hazmat, you know, what do you think about, uh?

Speaker 2: 33:56

that specialty, maybe yeah hazmat ltl again another specialty where you could do exceptionally well. Um so, hazmat LTL, multi-zone temp vans, side doors, you know in your reefer, all those sorts of things that allow you to do split zone loading, multi-stop loads. I would not be afraid to do multi-stop loads. You can throw 10 or 12 stops on me and I wouldn't blink an eye, right, Because I know some drivers get really nervous about multi-stop loads. The reality is, the more stops, the higher the rate per mile. Now it takes you a little bit more time, but if you load it right and you get yourself into the right market, that's a really lucrative business.

Speaker 1: 34:39

Get some straps, strap it in, make sure it's secure and legal.

Speaker 2: 34:42

Yeah get all that ugly stuff. No one else wants to haul Right.

Speaker 2: 34:50

Specialise in ugly freight like man, that's the ugly freight in my life, but you get good at it like um. You know, it's a pity they don't do it here, but you know, in australia we have um sideload. They're like conestogas but they're really, uh, curtain-sided trailers. It's a curtain-sided trailer, but what you don't see are mezzanine floors on the inside. They're adjustable mezzanine floors. So we have drop decks that run 245-50 tyres low-profile tyres on the tri-axle. So they're drop decks, curtain-sided, right, but with three mezzanine floors on the back lower part that you can adjust up and down with a forklift so you could put three levels of freight in a curtain-sided trailer. You can cube that thing out with so much ugly freight. It's amazing, wow. So now we don't have that here, right, we don't have mezzanine floors on the inside of curtains, inside of trailers, but you can build extra levels inside a van if you've got the right set of poles and I can't remember what you call them. What do you call those poles that are J-bars?

Speaker 1: 35:57

Crossbeams.

Speaker 2: 35:58

Crossbeams, yeah, Crossbeams. So if you've got a good van with crossbeams you can build floors to do that, and with cross beams you can build floors to do that. It's more work, but again, that's where you can find a niche in the market if you can tie that stuff down.

Speaker 1: 36:11

Very good, very good advice Get into that ugly freight.

Speaker 2: 36:14

That's where I think the money is, and especially hazmat. So LTL hazmat has always been a really good sector. You've got to know what you're doing.

Speaker 1: 36:22

Yeah, that's a craft too. I mean, you continue writing um, you're not just. Once you got it, you're done, you know, get that endorsement. And then you continue to learn from shippers and they tell you what to do, you know.

Speaker 2: 36:35

Hey, wow, I didn't know that, you know so yeah talking with other people is going to help you well, it comes back to taking a risk, doing new things, you know, going in with your eyes wide open, but also asking questions, like not being afraid to learn. We had Tyler Jones on our IQ show a little while ago and I said to Tyler what would you ask a young Tyler Jones starting out, you know, 20 years ago? And he said I would take way more risks than I did. He said I didn't take anywhere near the level of risks I should have taken as a young person entering the market, Because when I started to take risks, that's when I started to learn and grow, because I expanded my horizon.

Speaker 2: 37:16

And you know, that's why it's called experience, because experience comes from poor judgment. That's why it's called experience right. So the people that are experienced have just made a lot more bad decisions and screwed up a lot more. That's all that means. So you know, you talk to some people. You think, oh gosh, they're wise and experienced, and what you don't realize is they have blown up more stuff than you can imagine. Not literally, but yeah, I get it.

Speaker 1: 37:42

I can relate, yeah, if I get it. I can relate, yeah, yeah, if you're uncomfortable, you're most likely you're growing and expanding your knowledge. So when you're comfortable and you're setting your ways, you know you're going to always continue to get something.

Speaker 2: 37:56

I didn't. I just thought of something. My worst mistake was not belly strapping a load of granite one day on A-frames oh wow, oh right. Granite one day on a frames oh right. This stuff came 4 000 miles and I put it off the trailer in a flash because I strapped it over.

Speaker 2: 38:12

I didn't belly strap it to the a-frame like an idiot, yeah, and it went flying off the side of the truck oh like rookie mistake but I was like early 20s and the guy that loaded it said you're only going down the road, it'll be fine. You know that statement it's only going down the road.

Speaker 1: 38:32

It'll be fine.

Speaker 2: 38:33

Yeah, it'll be fine, it's not going anywhere. Well, yeah, too hard into a corner and next thing it's shattered. So, yeah, we all make mistakes, but we learn from it, right? So every time I look on social media or I'm driving down the road and I see someone with a load of granite that's not, you know, the straps not choked and it's not belly strapped and there's not a thousand straps on it I get, I get nervous yeah, yeah, we don't.

Speaker 1: 38:57

Don't stay behind or right next to it. People like to hang out by those tires, man yeah, yeah, yeah, but that's part of learning, right?

Speaker 2: 39:04

I think you're taking risks and learning. It's all part of life. No one's a rookie forever like, if you, um, if you're serious about this, you want to make a profession out of it, um, be prepared to make mistakes and get yourself into some tight binds like that's. That's part of part of becoming a professional operator and you talk to a lot of successful carriers.

Speaker 1: 39:23

Uh, what separates the ones who are barely scraping from the ones that are still making decent profits even now?

Speaker 2: 39:32

Other than I've got a CB radio, what's that? And they don't spend their 30-minute rest break in the fuel island. There's two things man does that make my blood boil. So but what? What it is? It's the serious person.

Speaker 2: 39:53

So what separates them is they are 100 serious about this as a profession. So I think that's that's the thing. Right is, is it? Are you doing it between? Is it a job you're doing between other jobs or you're serious about making this a profession?

Speaker 2: 40:06

Because if you talk to those guys, they are serious professionals but they're serious people like to the point where they're hard to talk to, right, because they're just so serious and but they know what they're talking about, they know their lane, they know what they're good at and they stick to it.

Speaker 2: 40:21

So I think what separates them is, over time they figured out what they're really good at and they kind of stick to it and they're somewhat inflexible, but they're very good at that, whether it be a flatbed or a reefer or a particular. You know they're an expert at hauling avocados or cherries or lumber, like they get very good at something. But what they've also done is become very familiar with the product and the shippers and the receivers and they know people and they know traffic and they know weather and they know their trucks, so they also do most of the work on their own trucks too, like. So they're sort of pretty good mechanics over time too, because that'll save you a lot of money. I think that's the difference is there. They approach it more as a profession than a job.

Speaker 1: 41:05

Nice. So I mean it's kind of focused on DAT helping truckers succeed. For folks that may not be familiar, how does DAT's platform help drivers or small fleets not just sign loads but actually run smarter?

Speaker 2: 41:19

businesses hosts, helping explain where the you know shows like this. Right, we're talking about the market. We do an IQ show every week talking about where rates are, which direction they're heading, where some of the hot markets are, where some of them are. So we've got some tools that help carriers figure out exactly what markets are hot, what markets are cold. You can do that every single day. Load to truck ratio is a really good tool that tells you where brokers are looking for carriers you can look at. You know you could buy some of our products where you can search on a lane and search what brokers are looking for, what brokers are looking the most often for loads on this lane every day, and you could call them and build a relationship with them and do a load.

Speaker 2: 42:05

My advice would be do what you say you're going to do If you're going to turn up, turn up on time and have that van clean. Don't have stuff laying on the back of the floor or the grooves in the reefer van full of debris Like don't be that guy. Turn up clean, ready to go, Because first impressions are lasting when it comes to that if you're doing your first run. So a lot of that sort of becomes, you know, fairly important I think. Then there's the rating side of it, you know, but I think the partnership side of it's more important because the, you know, the rate per mile is just one part of it.

Speaker 2: 42:55

What you've got to do is build your network of brokers and shippers and other carriers. So whether you're a dispatcher or a broker or a carrier, it's a good network to try and find, like people. And then, of course, you've got the forecasting side of it. If you're doing a bid, an RFP, if you're a larger carrier, we've got some RFP requests for proposal tools that help you figure out what's been the rate on this lane over the last 52 weeks, like what are the seasons, what can we expect to pay, what can we expect to charge on this lane and where should we price ourselves. So there's tools that can help you figure that out also, and that's across Drive-In Reefer and Flatbed.

Speaker 1: 43:26

What kind of real-world results or data do you see when someone actually leans on into data? That DAT provides, the tools that it gives, instead of just treating it like a simple load board.

Speaker 2: 43:38

Hard to put a real number on that, ray. We've got some guys that are just 100% spot market, that are hauling $4 a mile loads week in, week out, not full, but they've specialised in the pharmaceutical market. So I think what I can say generally is those that use the load boards that do well have a specialty, have a niche that most other carriers can't do. If they're in the refrigerated market, they've got the right trailer with a really new reefer motor, got the right cargo insurance coverage right, so they've spent the extra money to make sure they're not underinsured. What they've done is the ones that I see being successful. They've reduced as many barriers to working with brokers and shippers as possible. They allow ELD tracking, for example.

Speaker 1: 44:33

Transparency.

Speaker 2: 44:34

Transparency. So not only that people know who they are, they integrate their ELDs with all the different providers, so they're very open about what they do. So I can't put a number on it, but I generally see carriers hauling way above our market average, you know, and they're doing well because they've specialised in a particular commodity or a particular lane, or got the right equipment and they've got a good package. Hey, they wear. You know their email isn't a. You know it's an actual company email. Like they've got a proper company email address. They've got a uniform, They've got a good brand. Like they've got a proper company email address. They've got a uniform, They've got a good brand. Like they package themselves up really well. All that counts.

Speaker 1: 45:15

Nice. I mean, does DAT offer any special programs for training?

Speaker 2: 45:20

new businesses. We do, yeah, through our partner, otr Solutions. They're our fuel card vendor. They have an onboarding program to help people set up their whole branding and email package, for example. We do on our carrier onboarding site also, so there's a couple of ways to go about this. There are. I know the otr folks can help you set up a domain with an email address and a website name and all that stuff. You could do that. You don't have to do that through dat or any of our vendor partners.

Speaker 2: 45:49

But but you know, getting fuel cards is a very important thing too. Factoring is another important thing. Get you know, help with your cash flow, get a good factoring company, getting a good fuel card with a good buying discount all those things are really important. So we help with more than just the rate side of it. We can help you get set up as an independent contractor or an owner-operator if you're leased on and still want to buy our products, which people do, even if they're leased on to a larger fleet, which is kind of counterintuitive. So yeah, lots of things that we can do to help people get going Nice.

Speaker 1: 46:23

What are the positives about entering the industry now, even with the tough market? I know a lot of people listening out there may be thinking about getting their own authority buying their first truck. Like you said, 7,000 coming in. I mean, maybe there's more. What's some of the biggest things that you see that the biggest risk or challenges that people seriously need to consider before they take the leap?

Speaker 2: 46:44

Yeah, I think it's always not knowing your operating costs. I think too many people jump into this and think I'll figure this out as I go. It's a low-margin business so you've got to really know your costs and your lane and especially if you're starting out and you're going to end up in the spot market, you've got to do your homework, know what lanes to run. But if you don't know your costs, I don't know how you can negotiate. Like what are you negotiating from if you don't know your costs? I don't know how you can negotiate Like what are you negotiating from if you don't know what your costs are? So you have to have a good handle of what it costs you to run that truck. Don't lowball it, you know. Make sure you add some margin in there for the inevitable breakdown. Like, don't think $0.14 a mile escrow into an account for maintenance is going to cut it when it should be $0.16 or $0.14 a mile escrow into an account for maintenance is going to cut it when it should be $0.16 or $0.17 a mile because of the age of your truck. So don't lowball your operating costs. Don't be afraid to negotiate high when it comes to rates. But I think this would be a perilous time if you had too much invested in the truck, if you paid too much for it, right? So this is where you've got to be very careful. I generally don't discourage people from ever joining the trucking industry because it's been very good to me and I've been able to make a go of it even in the worst of times, because I'm a risk taker Like it wouldn't matter what you threw at me. I'd find a way to make a dollar Like I'm a risk taker, Like I'll. It wouldn't matter what you threw at me. I'd find a way to make a dollar Like I'm hauling stuff anywhere and everywhere. But I'm not I'm probably not like most people. I don't know that. Most people are risk takers. So, yeah, I think it's a good time. I tell you why I do think it's a good time because I feel like we're about to see a whole shift in the industry where shippers are going to have to find new suppliers all over the place and that's going to mean a lot more spot market volume on different origin destination pairings that we spoke about. So I think there's opportunity there if you're prepared to look for it and work with shippers and brokers. Try and find a shipper that's looking for a new lane, a new vendor. They just found a new supplier to their manufacturing. They need someone to run that one load a week. I'd be that person, you know. So that means picking up the phone. It means marketing yourself. Comes back to having a good website name, a good brand name, a good brand, a good package. Look and look and smell the part, and uh, and I. So I think there's opportunity. Uh, but right now, um, you've really got to go in knowing that we're in the low point. There is a theory that if I enter during the low point, things can only go up. Um, and I think that's true. What I don't know is how long it's going to take for things to go up.

Speaker 2: 49:34

We thought it was going to be April, the month we're in. A year ago. We thought this April we'd see the turn in the market. It's evaporated. So is it 2026? None of us knows. But I do think there's opportunity because, you know, the 7,000 people that joined this month can't be wrong. They can't all be wrong. There's something out there where there's opportunity and I think my gut tells me it's more on the less than truckload side and probably more on that closer to home. Final mile piece, you know, because I think you know you can never underestimate the American consumer. They're a great consumer of stuff and I think that stuff's got to move from warehouses to homes and I think that's where the growth is. Smaller trucks, you know. Get yourself a lift gate you know, do some clever things there.

Speaker 1: 50:30

That's what I like, that you know the hot shotting specialty calling yeah, maybe even power. Only you know power, providing that for disasters or for startups, for building projects. I mean that's huge too. I mean, I see, a lot of creators going down the road.

Speaker 2: 50:47

Yeah, you know I always toy with the idea. You know, this time of the year amusement parks open up fairs, those things pay huge money to pull those carnival rides around, like huge money. So you know there's all sorts of opportunity Bands, we're in the touring season, all that happens now.

Speaker 1: 51:12

So you mentioned Hasmat yeah.

Speaker 2: 51:14

I know a lot of guys that be. You know trash hauling one week and under an LTL double the next, or you know running gasoline the next. You know they're highly skilled, multi-talented people. So I think the way to do that is get get yourselves trained up and a bit of experience in all those fields.

Speaker 1: 51:34

I think that's how you get by in this industry nice hey, dean man, it's always a pleasure to be able to talk with you and get that, you know, get those feelers out there for the industry to know what's going on. Yeah, so always good to talk to you. You bring in such a real world data packed um perspective so that you know the people can get the value when they listen. So it's a pleasure to always talk with you and I'm glad I've got a chance to meet you there at mass absolutely cool trucks. Angry pete man, it's looking good.

Speaker 2: 52:00

Yeah, yeah, you did a nice job, man yeah, after the uh, american historical truck society show in madison, wisconsin, 5th and 6th of June. So I'll be driving over to Wisconsin. You'll see some of the old triple-digit trucks there. There's some old, cool fast trucks that go to that show. It's good to go to that show because you talk to all the guys that were on the road in the 70s and 80s. You know even the pre-deregulation era and even the Wild, wild West days of the 80s and 90s. It's fascinating to talk to the guys that ran the miles that we all sort of talk about. We look at the cool cabovers and wonder what it would have been like. They'll be there.

Speaker 1: 52:43

That's where they're at.

Speaker 2: 52:44

There you go.

Speaker 1: 52:45

Nice shout out for them, that's great. Yeah, so for all the listeners out there, if you want to level up your game, or be sure to check out everything that DAT has to offer, we're finding better freight, running smarter and staying informed. It's essential tool for you to, you know, want to survive in a thriving market or a downturn, so we'll drop the links down in the notes. Where can people look for you, dean?

Speaker 2: 53:10

Yeah, deancrokeatmecom Sorry, that's D-A-T, so the best one if you've got any data requests. Askiqatdatcom, that's a good one. We have a show every Tuesday called the D-A-T IQ Show. You can catch it on D-A-T Freight and Analytics on YouTube. So I have a weekly newsletter I publish at DATcom every Tuesday night. It's a blog post. It's.

Speaker 2: 53:36

Both of those are great ways to look at where rates are each week, and I would say one piece of advice would be don't dive in and out of the market every month and just say where are rates at. You've got to study this every week and you've got to read it every week so you get the continuity in where things are heading directionally, because one week's worth of data won't tell you the whole story. But if you piece it together over four or five months, then you get an idea where the market's headed. So get your head in the game, follow whoever it is If it's not me, I don't care but just get yourself tuned into the freight market whether it be this podcast or anyone's podcast or newsletter every single week and become a student of the industry.

Speaker 1: 54:20

Yeah, I mean. Think about the weather. You want to know what's going on, Do you have to put a raincoat on or something else, that's it. Yeah, all right, well, until next time and stay smart out there and remember a success is is here, isn't it just about luck, it's about preparation. So I'll catch you on the next episode of that's delivered.

Speaker 2: 54:38

Yeah.

Speaker 1: 54:39

Bye-bye.