As supply chains brace for the second half of 2025, the freight world faces a complex blend of pressures, including regulatory overhauls, volatile import volumes, and tariff-driven shocks.
In this edition of our monthly newsletter, we look at California’s aggressive warehouse emission rules, FMCSA’s IT revamp and staffing cuts, and other factors piling pressure on logistics and supply chain operations across the country. All this is happening while weak U.S. industrial activity is hitting trucking volumes and fleet growth even as carriers cling to stagnant rates.
Tariff Pause Fuels Temporary Import Surge
The National Retail Federation’s Global Port Tracker showed a temporary surge in U.S. port imports due to the 90-day tariff pause with China. April’s volume reached 2.21 million TEUs, up 9.6% year over year. However, May projections estimate a drop to 1.91 million TEUs, the lowest on record since December 2023.
June’s volume is forecast at 2.01 million TEUs, but that will also be down 6.2% from last year, while September and October are expected to contract by 21.8% and 19.8%, respectively. Retailers are cautious about placing full holiday orders amid tariff uncertainty, signaling a volatile second half for U.S. ports.
Trucking’s Capacity Cuts May Signal Inflation Shift
Market analyst May Ling spotlighted the trucking sector’s role in the Producer Price Index (PPI), noting it’s one of the first areas where capacity cuts have emerged instead of price hikes amid soft demand.
With operational costs up 34% over the past decade and spot rates stagnant since 2014, many small carriers have exited the market. Recent data indicates that Southeast tender rejections surpassed 10% for the first time in three years, while national spot rates increased by 9.1% year over year.
Ling’s analysis suggests logistics’ inflationary pressure may ease, but trade policy shifts could quickly reaccelerate rate volatility.
FMCSA to Modernize IT, Cut Staff, and Streamline Oversight
The Federal Motor Carrier Safety Administration (FMCSA) has plans in place for significant staff restructuring and IT modernization in its fiscal year 2026 budget, effective October 1. The agency intends to reduce its workforce by 89 full-time equivalent employees, with a focus on reductions in administrative offices.
IT spending will shift to the Department of Transportation’s Working Capital Fund, consolidating management of key systems. Initiatives include integrating safety and crash data systems, launching a federal registration system called Motus, and modernizing the National Consumer Complaint Database.
These upgrades are designed to streamline oversight amid the growing complexity of the freight market.
California Tackles Warehouse Emissions to Maintain Clean Air Progress
Facing federal pushback, California regulators are doubling down on local initiatives to curb logistics pollution. The South Coast Air Quality Management District (AQMD) is enforcing a warehouse indirect-source rule that targets facilities exceeding 100,000 square feet. Over six months, AQMD issued 220 violation notices and collected $1.3 million in penalties.
The rule requires operators to offset truck traffic emissions through EV chargers and battery-electric trucks. While industry groups criticize the measure as costly, AQMD says it’s crucial for tackling smog-forming pollutants, especially in Southern California’s Inland Empire, a logistics hub with the nation’s worst ozone pollution.
Weak Industrial Demand Pressures LTL Growth
Less-than-truckload (LTL) carriers in the United States have faced a challenging Q2 as weak industrial activity continues to pressure growth, even as rates remain at record highs. The LTL Producer Price Index has stayed at 259 for three months, matching 2022’s pandemic peak and about 5% higher year over year.
Old Dominion Freight Line reported an 8.4% drop in tonnage and a 6.8% decline in shipments in May, though revenue per hundredweight rose 5.6%. These numbers signal that carriers are prioritizing yield over volume. With manufacturing data suggesting continued caution, LTL growth is likely to remain subdued despite higher prices.
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Leveraging deep industry expertise, robust logistics and transport tech solutions, and a consultative approach, the company offers on-demand transportation across various modes (FTL, LTL, flatbed, hot-shot, and reefer) and end-to-end visibility into every shipment. Get in touch for a quick quote today.
