Trucking Is Booming Again, And Drivers Aren't Happy About It

In the last year, freight companies have seen a significant upturn in the business. Volumes are up. Billing is up. And in addition to growing demand, we've also seen new constraints on the supply side, with the administration cracking down on who is even allowed on the road. As we know, trucking is an especially cyclical industry, but is this current boom structurally different from past booms? Why is it that despite the boom, many of today's drivers are unhappy with the state of the industry? On this episode, we speak with Reed Loustalot, the chief marketing officer at the the Truck Parking Club, a company which aims to help drivers find parking, so that they're not using up valuable road hours just looking for a place to stop for the night. We talk about the crackdown on the supply side of the market, the rise of surveillance, and how a recent Supreme Court ruling could impair capacity even further. Read more: Ship Pays $4 Million to Skip Line to Cross Panama Canal https://www.bloomberg.com/news/articles/2026-08-11/ship-pays-4-million-to-cut-10-day-line-to-cross-panama-canal?utm_medium=referral&utm_source=podcast&utm_campaign=odd_lots&utm_content=article Trucking Stocks Fall on Legal Risk in Worst Month Since Tariffs https://www.bloomberg.com/news/articles/2026-07-31/trucking-stocks-fall-on-legal-risk-in-worst-month-since-tariffs?utm_medium=referral&utm_source=podcast&utm_campaign=odd_lots&utm_content=article Only http://Bloomberg.com subscribers can get the Odd Lots newsletter in their inbox each week, plus unlimited access to the site and app. Subscribe at bloomberg.com/subscriptions/oddlots https://www.bloomberg.com/subscriptions/oddlots?in_source=oddlotspodcast Subscribe to the Odd Lots Newsletter http://bloomberg.com/subscriptions/oddlots Join the conversation: discord.gg/oddlots https://discord.gg/oddlots See omnystudio.com/listener https://omnystudio.com/listener for privacy information.

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• 0:00Joe Weisenthal?

  There are some market stories where you want every detail. Tracy and I have made quite a few podcasts on that basis, but sometimes you've only got 10 minutes and need to know what's moving markets and why. That's the Barclays Brief Podcast. Every week, experts from Barclays Markets and research get you up to speed on what matters and what to watch next. About the time it takes to grab a coffee. So, search Barclays Brief wherever you get your podcasts.

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• 2:02Joe Weisenthal?

  Hello and welcome to another episode of the Odd Lots Podcast. I'm Joe Weisenthal.

• 2:06Tracy Alloway?

  And I'm Tracy Alloway.

• 2:08Joe Weisenthal?

  It's been too long since we've done a trucking episode. This is just an objective fact that we need to get out of the way.

• 2:12Tracy Alloway?

  It is time. I mean, to be fair, to be fair.

• 2:15Joe Weisenthal?

  Yes.

• 2:15Tracy Alloway?

  I think we've both written about trucking in the Odd Lots newsletter recently.

• 2:18Joe Weisenthal?

  I'm sure.

• 2:18Tracy Alloway?

  I think back in January, you started to get some of the freight and logistics companies talking about maybe they were starting to see an upturn.

• 2:27Joe Weisenthal?

  Yes.

• 2:27Tracy Alloway?

  And looking at some share prices since then. So, I've got, look up Night Swift at the moment.

• 2:34Joe Weisenthal?

  What's the ticker? I mean.

• 2:36Tracy Alloway?

  It's KNX.

• 2:37Joe Weisenthal?

  Okay, KNX.

• 2:38Tracy Alloway?

  Look up Night Swift or, you know, JB Hunt, but Night Swift is a little bit more dramatic. I mean, since January of this year.

• 2:46Joe Weisenthal?

  No, it's a great run.

• 2:47Tracy Alloway?

  It's, uh, it's had a great run. So, I think the trucking rebound, it seems to be here.

• 2:52Joe Weisenthal?

  It seems to be here. You know, the problem with going like a long time, I mean, as you mentioned, we do write about it. So, it's not like we're ignorant. But the one of the things that we learned when we did a lot of trucking episodes, particularly in the years after the pandemic, was like, when we talk about like the business cycle, you know, it's like these multi-year cycles. When truckers talk about the cycle, there might be like eight up and down cycles within one boom or within one recession, just extraordinary cyclical business.

• 3:19Tracy Alloway?

  Right. So, if we or hopefully anyone else have learned one thing from the truck episodes, it is that this is such an incredibly cyclical industry. And the standard explanation is that you have these really low barriers to entry for owner operators of trucks. And so, as soon as trucking rates start to go up, everyone decides to become a trucker.

• 3:40Joe Weisenthal?

  Yeah.

• 3:40Tracy Alloway?

  The market gets flooded, it overexpands, and then inevitably the rates start to come down. And then you have a bunch of independent owner operators who start to go bust and then capacity comes out and the whole cycle can begin again.

• 3:52Joe Weisenthal?

  Like, true. It's, it seems real boom bust. And you mentioned the share prices of Night Swift and JB Hunt. But another way to look at it, I'm just looking at the, the internet truck stop van rate index, just a sort of basic measure of how much it costs to move. That was in, um, December of last year is like a dollar ninety-four. I guess that's probably per mile. And now it's up to, it broke three, it came down a little bit. So, just by measuring the cost of, uh, trucking, it's clearly gone up. So, we need to figure out what's going on.

• 4:20Tracy Alloway?

  Sorry, I'm just looking at this night chart again, the Night Swift chart. You know, they've outperformed Meta this year.

• 4:26Joe Weisenthal?

  That's amazing.

• 4:26Tracy Alloway?

  I know.

• 4:27Joe Weisenthal?

  Look at JB Hunt. I think it's, and that one's like almost a double. Yeah.

• 4:30Tracy Alloway?

  Yeah, like, forget about AI. The money apparently is in trucking.

• 4:34Joe Weisenthal?

  Well, how are all, for real, how are?

• 4:36Tracy Alloway?

  This is how the cycle starts, right? People start saying the money is in trucking and then everyone gets it.

• 4:40Joe Weisenthal?

  How are the turbines getting to the data centers? How are all, like, right? Like, we know that there is a lot of demand for physical goods as part of this AI story. And the, uh, the physical goods have to get to the data center somehow. So, I think this is part of the story.

• 4:55Tracy Alloway?

  This is the question. Is this the sort of same rebound that we've seen before? Or is there maybe something more structural that's happening here? We've also had some recent developments with like the actual supply of truck drivers, right? Which is also something that clearly impacts capacity. So, there's a lot to talk about.

• 5:12Joe Weisenthal?

  There's a lot to talk about. It's time to revisit the trucking market. We have a guest that we've never had on before, but someone really like, someone I've known from the internet for a while who really knows the space very well. We're going to be speaking with Reed Loustalot. He is the Chief Marketing Officer at Truck Parking Club. And, uh, so Reed, thank you so much for coming on Odd Lots.

• 5:32Speaker 05

  Joe, Tracy, thanks for having me. Joe, I gotta give you credit, man. I said you weren't gonna do it, but you did it and you said my name right. So, congratulations.

• 5:39Joe Weisenthal?

  Thank you. All right. Test cleared, uh, for this, uh, episode. Actually, what do you, who are you? What's your background? What's the Truck Parking Club and all that? Why are we talking to you?

• 5:49Speaker 05

  Yeah, sure. So, I'm, uh, my name's Reed Loustalot. I have been in freight my entire career, which at this point is, is a, feels like a long and short 10 years at the same time. Started out of college at a freight brokerage, Echo. It's a large, large freight brokerage, top five freight brokerage. Then spent some time at a technology company called Trimble, did my own thing for a bit. That's where I encountered you on the, uh, the interwebs, uh, probably three or four years ago, just kind of stirring the pot on Twitter. Uh, and then I joined Truck Parking Club about three years ago. And it really have been focused on truck parking for the last three years, uh, which we can talk about because that's a trending topic as well. But yeah, I mean, I've been, I've been in freight my whole career and, and I'm a, I'm a freight guy.

• 6:33Speaker 05

  And, and I now live in Chattanooga, which is, uh, uh, has been dubbed Freight Alley by Craig Fuller. And, uh, yeah, so I'm, I'm, I'm in it, man.

• 6:43Tracy Alloway?

  Right. So, the, the parking thing is really interesting here because if you think about a truck or freight rebound, you think about things actually moving.

• 6:51Joe Weisenthal?

  Yeah.

• 6:51Tracy Alloway?

  Right? But I'm curious, from your perspective, does a rebound look like more trucks actually having to stop and find parking? Like desperately circling for a place, I don't know, around a data center or something like that and trying to find space? Like, is a healthy trucking market, what does that look like to a company that is in the truck parking space?

• 7:14Speaker 05

  Yeah, sure. So, you know, naturally as demand increases, we'll see, see more trucks on the road. You, Tracy, you kind of talked about a number of the trending topics ahead of this, you know? And you talked about the cyclical nature of trucking and the barrier to entry, if you will. So, there's, it's a very multi-varied market. And truck parking is one of those things that structurally, it's very difficult to construct new capacity because it's very limited in where you can do it. It's expensive. Many municipalities don't want it. And so, there's a bunch of structural reasons why it's difficult to quickly increase the supply in the traditional sense. And what we've done is really just leverage the existing space. So, there's millions of truck parking spaces across the US that are on private property.

• 7:58Speaker 05

  And we've just built a network, a marketplace to tap into that. So, we go to owners, we say, hey, you can make some money parking trucks. Comes on our app, drivers use our app, find parking on private property and pay the owner. So, Airbnb sort of style.

• 8:11Joe Weisenthal?

  Yeah, that's what I was just gonna say. It sounds like a 2010s era sharing economy sort of thing, but it makes sense.

• 8:17Speaker 05

  Exactly, exactly. And here's another thing about trucking is trucking is, from a tech standpoint, is always behind, right? And so, we're, you know, when you operate in the physical world and you're in, is it fragmented, a market is trucking is? I mean, there's nearly a million trucking companies and most of them are, you know, the long tails really, really small, less than 10 trucks. It's slow moving and it's slow to adopt technology and that's always been the case. And so, we're really scaling. And we've, we've really done this at an interesting time because like Tracy said, I mean, coming out of COVID, the market was hot, freight rates were through the roof, supply flooded the market because there was indeed a very low barrier to entry.

• 8:59Speaker 05

  And a lot has happened as a result of that. And technology has really flooded the market too, I would say, over that same period.

• 9:06Joe Weisenthal?

  Yeah.

• 9:06Speaker 05

  And so, there's a lot, there's a lot, I mean, there's a lot to talk about. So, I guess you guys tell me where you want to start.

• 9:11Joe Weisenthal?

  Yeah, well, here, I mean, let's start with like maybe the really simple question and then we'll drill down even further based on how you answer it. But like, big picture, this surge that we've seen over the last two or three quarters, whether we're looking at stock prices or maybe more importantly, rates, like decompose the drivers, the forces that have pushed these lines higher.

• 9:34Speaker 05

  Yeah, I mean, so coming out of COVID, you know, starting in mid, basically mid 2022, mid to late 2022, we saw rates fall. And we were in a, essentially a three-plus-year lull. And most folks were saying, most of the talking heads were saying that demand returning was the only thing that was gonna drive rates up. Like, that was gonna be the only thing. But what we've seen in really the last, you know, since the new admin- Administration took office, we've seen a massive kind of crackdown on English language proficiency, on non-domiciled CDLs. And there's been, as a result, a lot of capacity has kind of structurally been chopped

• 10:14Speaker 05

  out of the market. And so, supply has really dwindled. And man, to complicate things, there's also been, in the last couple of months, a Supreme Court ruling.

• 10:23Joe Weisenthal?

  Oh, yeah.

• 10:24Speaker 05

  Montgomery case, which, you know, historically freight brokers who move, I think on average about thirty percent of freight volumes, if I'm not mistaken, freight brokers, which are, you know, a critical component to the kind of the freight ecosystem, have historically not been liable, or have not been held liable for carriers negligence or carriers accidents, right? And now that's in question. And so, there's been so many kind of structural things that are really pushing capacity out of the market, and also making certain types of capacity come at a premium, right? Like, safety ratings all of a sudden might matter at carriers now, because brokers might be, you know, there's more scrutiny

• 11:04Speaker 05

  on brokers' selection of carriers. And so, there's, there's so many kind of like supply things that are affecting the rates, and that are kind of structurally affecting the barrier to entry. So that next time there is a demand spike, and you are seeing demand spikes in pockets of the market, right? Like, Joe, you talked about data centers, right? Flatbed has been booming, and data centers have a lot, and construction has a lot to do with that. But when you, if you really were to have like a COVID level event, where like there was unprecedented demand, I'm not sure the market could bring on as much new capacity as it did, like it did during COVID, because there are, you know, fundamental changes to the barrier to entry. And the government is really, really put a lot of, or is working to,

• 11:47Speaker 05

  I guess I should say, put a lot of barriers in to prevent bad actors coming in mostly, if you were to kind of look at it from their perspective. So, yeah.

• 11:56Tracy Alloway?

  I want to talk more about the barriers, but just before then, I'm, I'm really interested in the supply versus demand question. Are there any empirical things that you can look at to show that capacity is coming out of the market? I'm thinking, for instance, people used to look at like the spot versus the contracted rate, right? As one indication of capacity, and that started flipping earlier in the year. Is that, for instance, an indication that capacity is really getting limited?

• 12:23Speaker 05

  The data guys will look at the spread between spot and contract rates. I'll give you an anecdote.

• 12:28Tracy Alloway?

  Yeah, sure. Love it.

• 12:30Speaker 05

  That's essentially me saying I'm not the biggest data guy. But anyway, anecdote. So, I have a buddy who owns a trucking company. He's Ukrainian descent, immigrated here from Ukraine, I think, you know, over a decade ago. And many of his drivers were also Ukrainian. And this is a common story you hear in trucking. There's a many, trucking is a very rich ecosystem, full of every nationality you can possibly imagine. And they've got their own little network of companies, and they've got their own network of drivers. They bring people from their home country. And there's a lot of scrutiny on these folks right now, I should add, right? Because many of them have non-domiciled CDLs, which is a certain type of CDL. And there's been a lot of scrutiny on those. So, many of these folks have those CDLs. But despite that, and despite what people are saying about non-domiciled CDLs,

• 13:15Speaker 05

  there's still some really good companies. And in my days, I worked with a lot of them. So, I'm still friends with a lot of them. So, I was talking to my buddy, who's a Ukrainian guy, and he's like, "Look, this non-domiciled CDL ruling means I have to get rid of all of my drivers. I have to find all new drivers." And of course, that means I can't hire people who are in my network, many of whom have non-domiciled CDLs. So, this is a serious thing for many of these companies. And, and many of these companies are the ones that really do kind of run in the spot market, right? They're, they're the, you know, the five, six, seven, one, two, three truck carriers, which is, like I said, the vast majority of the total amount of companies. I mean, there's hundreds of thousands of these folks,

• 13:58Speaker 05

  and they're structurally at a major disadvantage. One, because of non-domiciled CDLs, but also, two, because of English language proficiency, which has been another thing the government is really focused, or the DOT, I should say, under Sean Duffy, has really been focusing on, which is, you know, it started from a very natural standpoint. It's like, if you can't read the signs, how can you operate an eighty thousand pound vehicle safely? Okay, fair. But naturally, that's also kind of pushed people out of the market, too. And you hear the same thing, I mean, I hear the same thing every day from my friends who, who own fleets, or who are drivers. It's, things are tough for them right now, and hiring drivers is difficult right now. And historically, it's been, another big issue is

• 14:41Speaker 05

  driver turnover. I bring it up, more issues, more rabbit holes. Driver turnover is, you know, at some fleets, it's over a hundred percent a year. It's crazy. It's crazy what goes on in some of these fleets. And when you kind of shrink the supply of drivers, that becomes even crazier. So, naturally, that'll mean, you know, better pay for drivers who kind of fit the profile that companies are looking for. But it's just kind of more pot stirring, if you will. That's just further complicating the situation.

• 15:24Joe Weisenthal?

  There are some market stories where you want every detail. Tracy and I have made quite a few podcasts on that basis. But sometimes you've only got ten minutes and need to know what's moving markets and why. That's the Barclays Brief Podcast. Every week, experts from Barclays Markets and research get you up to speed on what matters and what to watch next. About the time it takes to grab a coffee. So, search Barclays Brief wherever you get your podcasts.

• 15:49Speaker 01

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• 17:33Tracy Alloway?

  There are so many rabbit holes that you have already thrown out. But just going back to one, explain the non-domiciled CDL issue to me, because it sounds like, again, I'm not a CDL expert, but just based on the name alone, if I have a non-domiciled CDL, like, couldn't I eventually turn that into a normal domiciled CDL?

• 17:54Speaker 05

  That is a great question that I am not the best person to answer. I will be honest about the legality of the CDLs. I think what started all of this was, Joe, you probably, and Tracy, maybe you do too, but you know, there's a group on Twitter that we lovingly call ourselves FreightX, right? It's like this little kind of freight ecosystem. And for the last, I would say, two-plus years, there's been a growing group of people that have been really looking into, like, who are these companies that have flooded the market? Who are the drivers? What types of CDLs do they have? And one of the most tangible things that I remember was, it was probably a year ago, people

• 18:35Speaker 05

  started to discover that a lot of CDLs were issued to people with something called No Name Given as their first name, right? Literally on the-

• 18:45Tracy Alloway?

  Seems a little bit suspect.

• 18:46Speaker 05

  Literally on their license, it says like, "No Name Given." And so, I think that kind of, like, as people started to discover this, and also, you also had many trucking companies being registered at like, there was like two hundred trucking companies registered to like an apartment in, you know, Signal Hill, California, or like Sheridan, Wyoming. There's like six hundred trucking companies registered to a P O box. And so, that really kind of started people looking at this. And then the non-domiciled CDL thing really started to take off, you know, when Sean Duffy and the DOT started, I believe in June of 2025, really kind of honing in on, you know, English language proficiency and non-domiciled CDLs. But I believe non-domiciled CDLs have been around since the mid

• 19:28Speaker 05

  eighties. And there's, and it's not necessarily, like, obviously, it's not unlawful, or else they wouldn't be issuing them. But I think there was a lot of scrutiny put on certain states that were, just had massive spikes in the issuance of CDLs, like California and Minnesota, I believe, were the two kind of biggest, and New York were some of the bigger examples, where, you know, historically, they'd been issuing, you know, X amount of CDLs per year. And then all of a sudden, out of nowhere, right around COVID, it was like ten X, right? And all the while, you know, that all, that all happened in years past, and nobody really looked at it. But then in the last year, everyone's been like, "Okay, what's really going on there?" And so, that's kind of what's led to the scrutiny, if you will.

• 20:10Joe Weisenthal?

  So, someone with a non-dom CDL has taken a test in the US, or at least in theory, someone with a non-dom CDL. It's not like they're just like, "Oh, yeah, I took a test back and-"

• 20:22Speaker 05

  So, non-domiciled CDLs are for people who are foreign nationals, who are not domiciled here, but are legally allowed to work.

• 20:28Joe Weisenthal?

  Yeah.

• 20:28Speaker 05

  Right? And so, if they have the legal authorization to work-

• 20:32Joe Weisenthal?

  Sure.

• 20:32Speaker 05

  Then they can, then they can go and get a non-domiciled CDL.

• 20:35Joe Weisenthal?

  But just to establish, the CDL part, in, let's just say, in theory.

• 20:40Speaker 05

  In theory.

• 20:40Joe Weisenthal?

  In theory, the non-dom CDL is not someone who is like, "Oh, I got my trucking license in Ukraine, and then I moved to the United States and I'm trucking." In theory, the non-dom CDL is someone who moved here.

• 20:52Speaker 05

  In theory, in theory, right.

• 20:54Joe Weisenthal?

  But when you see a really big spike in the number of issuance of non-dom CDLs that are way out of historical proportion, the question that might arise for regulators is perhaps the quality of the CDL, et cetera. Like, that's sort of what this source of concern would be.

• 21:12Speaker 05

  And to go down another rabbit hole, there's been a lot of eyeballs on C D L schools lately.

• 21:17Joe Weisenthal?

  Yeah.

• 21:17Speaker 05

  There's some, you know, you remember that guy Nick Shirley or whatever, like the

• 21:21Joe Weisenthal?

  Yeah.

• 21:21Speaker 05

  Leering Center in Minnesota.

• 21:23Joe Weisenthal?

  Yeah.

• 21:23Speaker 05

  It's like.

• 21:24Joe Weisenthal?

  You guys, yeah, truckers have the same.

• 21:26Speaker 05

  Yeah, same thing.

• 21:27Joe Weisenthal?

  Okay.

• 21:27Speaker 05

  There's lots of suspect C D L schools, lots of suspect curriculums, lots of suspect trainings. They've essentially been handing out C D Ls like candy.

• 21:34Joe Weisenthal?

  Yeah. No, no, this makes a lot of sense. I know obviously the administration, Sean Duffy, the Secretary of Transportation, they've talked a lot about this, et cetera, like, okay, how many of these drivers are actually safe and did a proper education, et cetera?

• 21:50Speaker 05

  Yeah.

• 21:50Joe Weisenthal?

  But from your perspective, the people that you talk to, it's basically like, no, this is more than just tweets. This is not just, oh, we're looking into this, et cetera. You think there's a clear, like, on the ground effect from, this is real.

• 22:03Speaker 05

  Oh, 100%, 100%. And I hear it every day from my friends who own trucking companies.

• 22:08Joe Weisenthal?

  Yeah.

• 22:09Speaker 05

  Yeah, 100%.

• 22:09Joe Weisenthal?

  Okay.

• 22:10Speaker 05

  And it's been much harder to, you know, capacity has been much tighter. You talk to freight brokers, you know, what used to be, you know, rates have gone up and it's harder to find trucks. So.

• 22:18Joe Weisenthal?

  Got it.

• 22:19Speaker 05

  But there's only a couple of sources for that right now.

• 22:21Tracy Alloway?

  I guess what I'm getting at with the domiciled versus non domiciled C D L thing is, would you expect this to be a temporary blip as the administration, you know, scrutinizes some of these foreign drivers? But eventually they, I don't know, like, maybe they have to go back to school and get relicensed again. And then they come back on stream or is this like a permanent cut in driver capacity in your mind?

• 22:45Speaker 05

  Well, I think if I'm not mistaken, the government in March of this year said that essentially non domiciled C D Ls, it's not going to be as easy to renew them.

• 22:58Tracy Alloway?

  Okay.

• 22:59Speaker 05

  And so naturally they'll start to expire and there will be less of them over time. And I mean, who knows? You know, obviously we can't get a crystal ball out and see, you know, what's going to happen in the next election. So who the heck knows what another administration might do or might be able to do? Who knows how permanent any of this is? I, man, anyone's guess is as good as mine on that.

• 23:21Joe Weisenthal?

  It occurs to me that there's sort of two interlinked things that strike me as interesting. There, so let's say, okay, you have the Ukrainian owned trucking company and a lot of non dom Ukrainian drivers. And then to your point though, you know, they're part of a broader network and they might network with Ukrainian freight brokers, et cetera, et cetera. And now you have the Supreme Court ruling, which for the first time opens the door to the possibility of the broker, who traditionally wasn't held liable would be the carrier if there's a major accident caused by them. So it feels to me like this combination, like you could literally obliterate, like, sort of like whole networks.

• 24:05Joe Weisenthal?

  Like we think of the network as the driver, the truck, et cetera. But the network is also the sort of, the capacity is the ecosystem itself.

• 24:14Speaker 05

  So structurally, this is, if this continues down the path it's on right now, and a lot of the pundits, you know, the legal experts I know, I could name a couple, have said in the last day that if this all keeps going down this path, this is a serious structural issue for the freight brokerage business model. And if the freight brokerage business model is in trouble, then naturally that means that the long tail of trucking companies who primarily get their freight from freight brokers.

• 24:42Joe Weisenthal?

  Yeah.

• 24:43Speaker 05

  They're in trouble too. And so, you know, historically freight brokers have had to have processes to audit the carriers they set up and audit the carriers they give freight to. And each one has kind of had their own process for that. And that's evolved and there's been a lot of technology that's gone into the vetting and compliance side of freight brokerage in the last couple of years, mainly because another thing we haven't talked about, which is the whole rabbit hole is cargo theft. Cargo theft has been through the roof since COVID. And there's been a kind of a huge amount of criminal element, like large criminal elements that have come in and are doing everything from spoofing carriers, pretending to be carriers, to setting up fraudulent entities,

• 25:24Speaker 05

  acting like a normal carrier for a while, then figuring out where the good freight is, stealing that and then disappearing.

• 25:29Tracy Alloway?

  Oh, wow. I thought you just meant someone like picking a box off the back of the truck or something.

• 25:34Speaker 05

  No, no, no, no, like, I'm talking like mafia type stuff.

• 25:38Tracy Alloway?

  Wow, yeah.

• 25:38Speaker 05

  Like crime rings and, and that's exploded in the last couple of years. And so as a result of that, freight brokers have been much more scrutiny of who they're hiring. And now, you know, safety, which is kind of the element we're talking about here with regard to the, the Supreme Court ruling is like, okay, what's a safe carrier, right? And, and so far brokers have really kind of relied on the F M C S A's rating, right? It's satisfactory, conditional or not rated, right? And so traditionally it's like, okay, I hired a satisfactory carrier. It says on the F M C S A's website, they're satisfactory. That must mean something, therefore they're good. I'm going to hire them. And they go, like, recently there was C H Robinson was involved in a case where they hired a carrier that was satisfactory,

• 26:23Speaker 05

  that had done like 200 plus loads for them and then was involved in a wreck. And now they're facing like a $600 million judgment, right? And they, they're appealing it naturally. But if that, I mean, if that holds true, like the freight broker business model is going to be in serious trouble because the government's not really telling them like clearly, okay, this is a safe carrier. This is the vetting standard. Use this. If you do this, you're covered, right?

• 26:48Joe Weisenthal?

  Yeah.

• 26:48Speaker 05

  They're not really doing that. There's a lot of, there's a lot of kind of gray areas around this. And that's, that's naturally going to cause a lot of problems for freight brokers. And like I said, the vast majority of these small carriers, and there's hundreds of thousands of these companies, they get their freight from freight brokers because.

• 27:04Joe Weisenthal?

  Yeah.

• 27:04Speaker 05

  They can't go, it's difficult for them to go get direct customers. It's traditionally, like, if, if I'm a one truck operator and I walk into Kraft Heinz, Kraft Heinz is going to be like, yo, like, I'm not giving you freight. I'm going to give freight to the broker who can give me a thousand trucks. Or, you know, Night Swift, who can give me 10,000 trucks.

• 27:22Joe Weisenthal?

  Yeah.

• 27:22Speaker 05

  So it's just a very, it's a very difficult time.

• 27:24Joe Weisenthal?

  Yeah, this is Tracy, what I think like, maybe we need to broaden our conception of what capacity means. Cause we think of it as drivers, we think of it as trucks, et cetera. But if there is a small carrier and it's 10 trucks and 10 drivers, if they can't really like plug into a network that they know.

• 27:41Tracy Alloway?

  Yeah.

• 27:41Joe Weisenthal?

  Then is that even, then that is, is that even capacity?

• 27:44Tracy Alloway?

  I'm looking at a headline right now from, I guess this is a stat from Roadmaster Group, but they're saying cargo theft jumped 60% last year. That just came out, oh, three hours ago. And also there's a New York Times headline saying nearly 11,000 bottles of bourbon were stolen from a Philadelphia warehouse as a result of coordinated cargo theft.

• 28:03Joe Weisenthal?

  It's funny because you and I both just assumed that when you said cargo theft.

• 28:07Tracy Alloway?

  I thought it was like grabbing boxes.

• 28:08Joe Weisenthal?

  Yeah, like, you know, like, like in Goodfellas, where you're like.

• 28:13Tracy Alloway?

  That's as far as my criminal ambitions can stretch.

• 28:16Joe Weisenthal?

  And then the truck driver is like, please beat me up, right? Do you remember that in Goodfellas? He's like, please beat me up so that my own boss does not think that I stole it. And, but it is much more sophisticated.

• 28:26Speaker 05

  They've targeted Guy Fieri. Guy Fieri had freight stolen. Like all these celebrities in the last like year have like seemingly come out with liquor brands and they're all being targeted too. Like I think Shaq's like Range Rover got stolen off a car hauler. Like there's, there's been all sorts of crazy stuff, but I mean, all jokes aside, like it is crazy. It is crazy what's going on and seemingly it's only getting worse despite all the scrutiny and all the tech that's been kind of brought in. But Tracy, you did kind of mention something interesting, or maybe it was Joe, the kind of the different types of capacity, right? Like one thing that I'm thinking a lot about, and I'm not a freight broker anymore, so I, I'm slightly removed, although I did do it for many years. Historically, there's not really been, it's, freight's really a commodity.

• 29:09Speaker 05

  And there's, you know, one carrier versus the other, might ask you for more money, but you don't really have a good reason to pay carrier A much more than carrier B. You know, some situations might be like, okay, you know, yeah, I'll give you a couple hundred extra bucks because I know you, I trust you. And that's worth it.

• 29:24Tracy Alloway?

  But it's pretty much the same service, right? Like you expect the stuff to go from one place to another.

• 29:29Speaker 05

  Yeah, yeah. It's, and traditionally it's been viewed as a commodity. But like now that there's this kind of extra scrutiny on the broker's vetting process and the hiring process, like there might start to be a kind of strata of carriers where like they've got the best ratings, they're the safest operators, like they're able to fetch a premium and brokers might be like, shoot, like I have to pay them more because I need to check these boxes so that if they get in a wreck, God forbid, I'm as covered as I possibly can be in the event that some, you know, billboard attorney tries to sue me for $600 million.

• 30:05Joe Weisenthal?

  Yeah.

• 30:05Tracy Alloway?

  That's really interesting. So like you could start to see more, I guess, diversification come into the market. More like stratification on rates, people paying a premium for certain services or trust.

• 30:17Speaker 05

  I think that would make sense to me if that, if that happens. I think that would make sense. The jury's out on if that'll happen, but that makes sense to me.

• 30:24Tracy Alloway?

  The other thing I wanted to ask about is just, how do people feel about becoming truckers at this particular moment? So rates are up, it seems like the money's there, or at least there's more money there than there used to be a few years ago. But at the same time, we still hear complaints about it's a tough life, you're on the road all the time, the hours are insane. Like maybe you're waiting hours at a port to pick up a load.

• 30:47Joe Weisenthal?

  Parking.

• 30:47Tracy Alloway?

  Hard to find parking, clearly.

• 30:49Speaker 05

  There's a lot to say here. There's a lot to say here. And it's actually interesting because I did just, you know, at Truck Park, we run a survey of all of our driver base basically every week. And I happened a couple of weeks ago to do a survey, basically just about like drivers' opinions on the state of the industry. Right? Would you recommend this job to a friend? Like, how do you feel about trucking? And anecdotally, I can say that in my discussions with my driver friends, like it seems like morale's at an all time low. That's just the anecdotal, what I hear from people. But structurally, I mean, or what I see kind of in these surveys is like, like there's a strong sense of nostalgia in trucking. Like it was much better then than it is now, right?

• 31:34Speaker 05

  You look at like the seventies and eighties, when you had Smokey and the Bandit.

• 31:37Joe Weisenthal?

  Yeah.

• 31:37Speaker 05

  Movies like that, truckers were like cow, yeah, truckers were cowboys, right? Or explorers or frontiersmen, right? And they were respected and it was something that was a desire. It was kind of the last kind of frontier, right? You're out on the road, kind of figuring it out. And now it seems for whatever reason that that kind of ethos has been damaged. And, and you hear a kind of a lot of just kind of like a mourning of the industry when you talk to drivers. And like, and this manifests itself, like if you go to a truck stop and you just kind of pulled random drivers, I guarantee you that if you ask them, you know, were things better in the past than they are now? And maybe this is just a human thing.

• 32:15Joe Weisenthal?

  Yeah.

• 32:15Speaker 05

  To a degree, perhaps. So this isn't like a scientific study by any means, but like there is a strong sense that things were better in the past. And I think there's a lot of reasons for that. So, you know, technology. For the driver is a bad word traditionally.

• 32:32Joe Weisenthal?

  Yeah.

• 32:32Speaker 05

  Okay. Because technology for the driver has meant surveillance. It's meant in cab cameras surveilling their every move for viability reasons. It's meant speed limiters. It's meant electronic logging devices, which severely limits their freedom to operate as they see fit on the road. So it's all of these things that have kind of like constrained them. Right. And if you think about traditional trucking as freedom on the road, like this, these are all anti-freedom things, right? And so if the traditional trucker is looking for a job that gives them freedom, they're not finding that as much anymore. And so technology has had a bad rap. And I tend to agree with the driver on that.

• 33:16Speaker 05

  Like, there's all sorts of reasons why all of those things are useful. But like, I, I can understand why they would feel that way.

• 33:22Joe Weisenthal?

  Yeah.

• 33:23Speaker 05

  Right?

• 33:23Joe Weisenthal?

  If we start from the premise that it's already going to be a lifestyle sacrifice. And you're like, well, okay, it's a lifestyle sacrifice, but there's a paycheck. And everyone makes a lifestyle sacrifice paycheck. But if it turned out that is like, in the past, it was a lifestyle sacrifice plus a paycheck, plus a certain culture of, as you said, freedom and the sort of maybe.

• 33:46Tracy Alloway?

  Burgers at roadside cafes.

• 33:48Joe Weisenthal?

  Just like all these, like the sort of, and then it's just like, no, it's no longer that. It's just the lifestyle sacrifice for the paycheck. Then that's a different equation.

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• 36:48Tracy Alloway?

  The other thing is, just on the technology front, is for years now, we've been hearing that, you know, self-driving trucks are coming down the line. So I imagine if you're a young person thinking about getting a CDL, maybe you're no longer looking at it as a viable, long-term career.

• 37:03Speaker 05

  Yeah, I mean, autonomous is very interesting. It's, it's anyone's guess how long that's going to take to really reach significant levels of adoption. I know there are many companies currently operating autonomous lanes, mostly in Texas. And we do talk to these companies because, you know, one thing people ask is like, okay, like, if all the trucks are autonomous, like, do they even need to park? Like, does your business still exist? And so we, we have a whole, one, there's still trailers. Trailers need to be staged.

• 37:29Tracy Alloway?

  Yeah, they still have to park, right? They must do.

• 37:32Speaker 05

  Yeah. And people forget that there's many.

• 37:34Tracy Alloway?

  Oh, people are suggesting that they'll just keep driving forever? Like, they never need to stop, basically?

• 37:39Speaker 05

  Yeah.

• 37:39Tracy Alloway?

  Okay, I see. All right.

• 37:40Speaker 05

  And, and they're like, okay, you know, and, and we've, I've got my whole reasons why that's actually not the case. And we're actually kind of in deep conversations with the autonomous companies because autonomous trucks need reliable staging, and they need to be able to plug into a network to know that if I arrive at this location, I'm going to have a spot. And truck stops and rest areas do not provide that level of surety at all.

• 38:01Joe Weisenthal?

  Yeah.

• 38:01Speaker 05

  Right? Like, I honestly do think that of all the trending topics that we've talked about, like, a lot of them are really kind of like billboard-level things, shocking. Like Guy Fieri's tequila gets stolen, right? Like cargo theft, like.

• 38:14Tracy Alloway?

  Not the mayor of Flavortown.

• 38:16Speaker 05

  Right. And, but parking is really actually, I mean, it is one of the, like, top issues when you talk to drivers. Like, if not the top.

• 38:24Tracy Alloway?

  Like a quality of life issue is what you're saying, right?

• 38:27Speaker 05

  It's unbelievable. It's a quality of life issue, but it's also a pay issue, like a significant pay issue. And let me, let me explain. I, I hinted at ELDs, so electronic logging devices. In 2017, it was either 2017 or 2018, I can't, I can't remember now. But the government mandated every truck must have an electronic logging device. So drivers are allowed to operate 14 hours a day, 11 of which they're allowed to drive. Okay? And there's no moving that around. And if you go over that 11 hours, you're in trouble. It's going to hurt your record. It might increase your insurance premiums. It'll cost you money. It's a problem, right? You do not want to do that. And so naturally, what that means is the driver's day is very rigid. You know, I was driving to work this morning on I-75 in northern Georgia. There's a rest area I pass every day.

• 39:12Speaker 05

  And every day, there's trucks lining the exit ramp of the rest area, like on the highway. And how those trucks end up there is they've got two hours left on their clock. It's 5:00 PM. Like, they're rolling down the highway. They're trying to go as far as they can because they're paid by the mile, right? And they don't get that time back if they lose it. And they're trying to get as close to their destination as possible. And what that means is naturally, there's a trade-off every single day that every driver makes who's driving over the road. It's like, okay, I could park now, but I've got four hours left. Right?

• 39:48Joe Weisenthal?

  Yeah.

• 39:48Speaker 05

  I could park now and take a spot at the truck stop that's open because it's 3:00 PM and nobody's parked yet. Or I could keep going down the highway, go before more hours, and end up in the middle of Atlanta at 8:00 PM with nowhere to go. Right? And so there's, there's a serious cost associated with losing those four hours.

• 40:08Joe Weisenthal?

  Right?

• 40:09Speaker 05

  And four hours is a bit of an egregious, like, that does happen every single day. But even if it's one hour, right? If you think about the cost to operate a truck, if you think about how many miles you're able to drive in an hour, like, and then you multiply that across an entire year for a driver or for a fleet, you multiply that across their entire, all of their drivers. Like, and the cost and the productivity loss go sky high really, really quickly. And historically, there's been not really much fleets or drivers could do about that. Right? And not only is it a pay issue, but it is a quality of life issue, to your point, Tracy. Like, you guys live in New York City. I don't know if you have cars, but parking in New York City, not the easiest place to park in the country.

• 40:47Tracy Alloway?

  To put it mildly.

• 40:48Speaker 05

  To put it mildly, right? And naturally, that will mean, you know, if I'm coming into New York and I want to go to a Knicks game, and it's two hours before, like, I gotta be methodical about, okay, here, I'm going to go here. I'm going to park there. I'm going to get there then. And if that's too much of a pain, I'm not going to go. Right? I'm not going to go do that thing. But when you live in rural, you know, Georgia, you don't think anything about where you're going to park. Go, oh, yeah, I'll be fine. Like, I'm just going to go. Right? There, I got a place to park. And what truck drivers, like, my analogy is like, truck drivers, every single day is like being in New York City in the Super Bowl, the World Series, the NBA Finals, the NHL Finals are all there on the same day, and there's nowhere to park at all.

• 41:33Speaker 05

  And you have to go. And it's going to be a total, it's going to cause you lots of stress. You're going to be like, what the heck am I going to do? Right? And that's every single day.

• 41:40Tracy Alloway?

  Okay, but explain this, because America has a lot of roads. It's got a lot of highways, a lot of interstates. Where are all the park, like, why do we seem to have a shortage? Maybe it's not even a shortage. Maybe it's misplanning of resting areas for trucks. Why the scarcity?

• 41:56Speaker 05

  Because it's very, the traditional places to park, which are rest areas, which are built by the state or the federal government, and truck stops. And those can only go in so many places, right? Loves and TA and Pilot, like, they would love to build more locations, but it's not like you can just put them anywhere, right? There's only so many interstate exits where it's appropriate to put a truck stop and economical because they're super expensive. Right? And then rest areas are very, very expensive to build. Like, if you look at some of these projects that the government funds, it's like, sometimes it's as much as $200,000 to $300,000 per space by the time a project is done. It takes years to complete. And so structurally, it's very diff, it's just difficult to build capacity.

• 42:41Speaker 05

  And, you know, between rest areas and truck stops, there's about 700,000 spaces provided by these traditional sources. But there's millions of trucks on the road, right? And millions of them need a place to park on a daily basis. And so naturally, what you see is, if you talk to any driver, 5:00 PM every day, the truck stop's full. Like, I talked to an owner operator yesterday who's parked with us. So basically, what we enable them to do is fire up their phone, find a place to park, basically no matter what, at any time of day, in essentially almost any city at this point. And what the difference that makes for a driver, let me explain. So I talked to an owner operator yesterday. He's parked with us 56 times in the last year. And he's spent, like, obviously, he's spending his own hard-earned money on that.

• 43:24Speaker 05

  But he's not just doing that and operating the same way that he would if he were just parking at the truck stop. He's thinking like, okay, like, I'm going into Denver, and Denver's a hard place to park. It's going to be 7:00 PM by the time I get there. I have to deliver at 3:00 in the morning. In the middle of Denver, I'm going to pay 25 bucks or 30 bucks or 40 bucks to park a mile from my warehouse versus parking 30 miles away at the truck stop and having to negotiate the hours of service requirements to be able to go and leave. And so that money he's spending is position, he's positioning himself properly next to his delivery. He can be there on time. He doesn't have to fight traffic. He's the first one there. He gets

• 44:09Speaker 05

  empty and that surety just offers him much more reliable planning, right? And that just means, that just means his life is easier, right? It's less stressful. He's not driving into New York during the World Series every single day. And that's just an anecdote from a driver, right?

• 44:26Joe Weisenthal?

  So the key thing, though, just to understand this is a big function of this is the fact that drivers get paid by the mile, not the hour. And so if in the ideal world, you have 11 hours on the road, 11 hours where you're allowed to be behind the wheel, you're going 60 miles an hour, maybe on average, you cover 660 miles in a day. That's a, that's a good day or something like that. If three hours of those are spent waiting in line for something by the side of the road, because you're not sure if there's going to be parking when you hit the 11th hour, that's three hours of your day. They're not getting paid.

• 45:01Speaker 05

  That's three hours gone.

• 45:02Joe Weisenthal?

  That's three hours of behind the road time that clocks to your, that goes to your maximum that is not compensated. Yeah.

• 45:10Speaker 05

  Yeah, that's not compensated. And, and the fleet loses those productive asset hours too, right? Like there's layers to this. And then obviously, you know, you multiply that across the entire trucking market. And that's like a serious kind of like throughput issue for the supply chain.

• 45:26Joe Weisenthal?

  Yeah.

• 45:26Speaker 05

  Like, I can't emphasize this enough. Like, still to this day, most people in the industry do not think, oh, they, they just think, oh, well, this is a problem. We all agree this is a problem. What are we going to do? Oh, well, we need to wait around for the government to allocate enough money and bill enough spaces to fix this problem. And that's just not going to happen if we're honest with ourselves. And it makes sense. The government should be investing in this critical infrastructure. It's needed. Great, do it. Get as much as we can. The drivers need it. The more, the merrier. But all the while, we're adding, you know, sometimes 1,000, 1,500 new spaces to our network a week, right? A week.

• 46:04Joe Weisenthal?

  Cool.

• 46:05Speaker 05

  And so we're at like, you know, near 90,000 and we're adding more spaces in a week than truck stops build in an entire year, right? And we're already have a larger, more spaces than the largest truck stop chain, right? And soon we'll have more than all of them combined. And soon we'll have more than all of the public infrastructure combined. And that's going to just fundamentally reshape how drivers and fleets are able to operate. And, and that might sound hyperbolic to people who don't think about this like I do, but it is a very meaningful change to just the, the life of a driver. It just really is. And just to the productivity of a fleet, the drivers pay, the drivers help, like it touches turnover, it touches cargo safety, it touches all of kind of the hot topics we've talked

• 46:47Speaker 05

  about. Like, it's all connected to this. It's all connected. So I'm getting fired up, guys. I'm getting fired up.

• 46:54Joe Weisenthal?

  That was great.

• 46:55Tracy Alloway?

  We talked a lot about the supply side of the industry. Can we just discuss demand a little bit more? Like, on a basic level, what are you seeing from your network? Are you seeing pockets where things are really hot right now? Where, for instance, data centers are being constructed and things like that?

• 47:13Speaker 05

  Yes. You know, the components of the data centers are obviously incredibly expensive. You're talking turbines, you're talking, obviously GPUs and all that, and super, super expensive. And naturally, targets for theft. And so we've had direct conversations with folks building data centers and are actively working on projects to kind of help them plan, okay, we're going to stage here, we're going to stage here, like, we need locations here. And so we're actively working on that right now. So to answer your question directly, yes, yes, of course, we are seeing, we are seeing pockets of demand. And we are seeing, you know, it's, it's, it's interesting because we're just kind of like this. So it's hard to tell like what's seasonal and what's not, when you're just kind of like this, no matter

• 47:55Speaker 05

  what. You know, maybe in two years, like, we'll be able to, like, have much more, okay, this is like this season, this is that season. But yeah, I mean, the short answer to your question is yes.

• 48:04Joe Weisenthal?

  All right. Reid Lustelot, thank you so much for coming on Odd Lots. For all the trucking episodes we've done, we've actually learned quite a bit more on this one. So really appreciate you taking your time.

• 48:15Speaker 05

  Yeah, I appreciate you, Joe and Tracy. You guys are, you guys are killing it. Joe, your Twitter game is strong, man. I, I love following you. I always smash like. But thanks, thanks for having me on. I really appreciate it.

• 48:27Tracy Alloway?

  Thanks so much for you. That was fun.

• 48:29Speaker 05

  Thanks, guys.

• 48:42Joe Weisenthal?

  Tracy, I'm so glad we did that episode. There's so many interesting, so much interesting texture, maybe is the word to the trucking market that is easy to not really observe if you're just looking at very simple metrics, like line going up or how much physical capacity there is in a day.

• 49:00Tracy Alloway?

  Yeah. I mean, it seems like a lot has changed, for sure. It does seem like some of the things we talked about are more structural than cyclical, right? And again, who knows what the next administration is going to do. But for instance, a Supreme Court ruling saying that brokers can be held liable for dangerous hauls and things like that, that would appear to be something that's going to stick around and possibly affect the industry for years to come.

• 49:24Joe Weisenthal?

  No, it seems like a really big deal. And Reid put it really well. It's like, okay, like, maybe there's fewer brokerages in the future, et cetera. But then it's like, okay, you might have drivers and carriers. It's capacity.

• 49:38Tracy Alloway?

  Right.

• 49:39Joe Weisenthal?

  Maybe it's even safe, well-trained, very fluent in English capacity, but it might not have the scale to sort of plug into whatever that sort of new network or ecosystem looks like in a world with fewer brokers. Is it really capacity then at that point?

• 49:54Tracy Alloway?

  And then it also means that the freight brokerage game isn't always going to be a race to the bottom, which I'm sure there's going to be a broker firm out there who complains. But like, the impression you get is a little bit like, you know?

• 50:05Joe Weisenthal?

  Yeah. And also, I think, you know, one of the things that we both observed when we started doing trucking episodes is, why is there still so much humans in the middle?

• 50:16Tracy Alloway?

  Mm hmm.

• 50:17Joe Weisenthal?

  It's because it's not a fungible market in the classic sense. It's very unsympathetic, kind of like the corporate bond market is the analogy that we use. If we have to get even more gradations of safety ratings. By the way, the FMCSA, he said that term, and so I wanted to tell people what it was, the Federal Motor Carrier Safety Administration. So it's like, if we need like more gradations of safety ratings for the existing brokerages to feel comfortable with them, I'm going to, having thought about this for five minutes, I will now weigh in on policy. It would be probably helpful if there was one rating where it said, if the broker goes with this rating, they are clear in terms of these sort

• 51:01Joe Weisenthal?

  of nuclear settlements or these nuclear lawsuits, et cetera, that could destroy a whole company. It probably would be good to have like, at least on your part, a clear box that you can check that establishes that you've done the right thing.

• 51:13Tracy Alloway?

  Credit ratings for freight brokers?

• 51:15Joe Weisenthal?

  Yeah. And it's like, if you, you know, it's like your other, there are various ways to get in trouble. But if you get the AAA carrier, then if the broker goes with the AAA carrier, at least on that level, they've done their due diligence.

• 51:26Tracy Alloway?

  Nothing bad can ever happen from AAA ratings. All right. Shall we leave it there?

• 51:30Joe Weisenthal?

  Let's leave it there.

• 51:31Tracy Alloway?

  This has been another episode of the Odd Lots Podcast. I'm Tracy Alockway. You can follow me at Tracy Alockway.

• 51:36Joe Weisenthal?

  And I'm Joe Weisenthal. You can follow me at TheStalwart. Follow our producers, Carmen Rodriguez at Carmen Armand, Dashell Bennett at Dashbot, Cale Brooks at Cale Brooks, and Kevin Lozano at Kevin Lloyd Lozano. And for more Odd Lots content, go to Bloomberg.com/oddlots, where we have a daily newsletter and all of our episodes. And you can chat about all of these topics 24/7 in our Discord, discord.gg/oddlots.

• 51:59Tracy Alloway?

  And if you enjoy Odd Lots, if you like it when we do these trucking episodes, then please leave us a positive review on your favorite podcast platform. And remember, if you are a Bloomberg subscriber, you can listen to all of our episodes absolutely ad free. All you need to do is find the Bloomberg channel on Apple Podcasts and follow the instructions there. Thanks for listening.

• 52:49Speaker 08

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• 53:20Speaker 07

  If you enjoy Bloomberg podcasts, you'll love listening to Bloomberg 991 FM in the DMV. Hi, this is Nathan Hager. Here in the district, the story is always changing. From the White House and Capitol Hill to K Street, Wall Street, and the Fed, Bloomberg 991 keeps you connected to the news that's driving decisions in the nation's capital and around the globe. Check us out at 991 FM or stream us anytime on the Bloomberg Business app.