Uber’s side bet on the freight business has turned into big business.

Since Uber launched Uber Freight in May 2017, the digital freight broker has grown to more than $350 million in annual gross bookings, according to paperwork the company filed last week in advance of a proposed stock offering.

In the past two years, Uber Freight has contracted with 36,000 carriers, 400,000 truck drivers and 1,000 shippers. The latter group includes 100 enterprise-level shippers, including such national brands as Anheuser-Busch InBev, Niagara Bottling, Land O’Lakes Inc. and Colgate-Palmolive Co.

That business added up to $125 million in revenue for the quarter ended Dec. 31, according to the form S-1 registration statement that Uber submitted to the Securities and Exchange Commission in advance of a much-anticipated initial public stock offering that could happen as soon as May.

If Uber Freight continues to operate at that rate, the company could hit revenue of $500 million this year. That puts it among the country’s top three digital freight brokers, behind Convoy and JB Hunt 360, according to Craig Fuller, chief executive of FreightWaves, a freight-markets data analytics company.

“All of them are kicking ass right now and taking share from the incumbents. It’s them and everyone else,” Fuller said.

Uber Freight’s expenses have increased as the business has expanded. Cost of revenue, not including depreciation and amortization, jumped to $288 million in 2018 from $71 million in 2017 due to higher carrier costs, according to the S1. The filing does not break out profits for its non-core businesses. However, those ventures lost an aggregate $152 million in 2018, according to the S1.

A LOOK INTO UBER

The filing provides other indicators of Uber Freight’s current business and future plans:

• Uber pegs Uber Freight’s current share of the $700 billion U.S. truck freight market at 0.1 percent based on the division’s total gross bookings of $359 million in 2018.
• In March, Uber Freight announced it would expand into Europe, beginning in The Netherlands, where it will operate as a freight forwarder. As of early April, the company was recruiting local Dutch carriers and drivers. Uber said it plans to launch in additional geographies.
• While its business is growing, Uber Freight faces formidable competition, including from larger, better-established brokers as well as other startups that have attracted substantial investor funding. According to the S1, Uber Freight identifies its biggest competitors as C.H. Robinson, Total Quality Logistics, XPO Logistics, Convoy, Echo Global Logistics, Coyote, Transfix, DHL and NEXT Trucking.
• Uber Freight’s 2018 gross bookings of $359 million accounted for slightly more than 3 percent of Uber’s $11.3 billion revenue for the year. During that 12-month period, the company lost $1.8 billion.
• Uber owns 89 percent of the capital stock in the subsidiary that operates Uber Freight. According to FreightWaves, the balance is likely owned by the team that started Otto, the self-driving truck business that Uber acquired in 2016.

Not all of Uber Freight’s initiatives have been successful. In March 2018, the company had to stop testing self-driving trucks after one of its autonomous cars struck and killed a pedestrian in Arizona. Uber began testing autonomous trucks in Arizona in late 2017 as part of an experiment to blend self-driving and conventional driver-operated trucks. The company used human drivers to deliver freight to transfer hubs on Arizona’s eastern and western borders, and the loaded trailers were then hooked to self-driving tractors and hauled across the state.

Uber’s IPO could value the company at around $100 billion, making it one of the largest public stock offerings in years

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ABINGDON, Va. — After spending nearly four years delivering pizzas around town, 46-year-old Janet McLean is looking for a different kind of career — one that will give her the adventures of the road and the freedom to work independently.

The single mom from Bristol, Virginia, is training to be a tractor-trailer driver, a profession traditionally imagined as being held by burly men wearing caps and dressed in lumberjack shirts.

“My kids are grown, and I’m ready to see the country. I’m taking to the road full time before the grandbabies come along,” said McLean, who’s completed five weeks of a six-week training course.

McLean and two other female students at Virginia Highlands Community College are participating in a Workforce Development course provided through the community college in partnership with the Virginia Truck Driving Academy, operated by Roger Roe of Roger’s Trucking.

The training course will prepare the women to receive their commercial driver’s licenses (CDL) and join a field that is currently only 6.2% female, according to the Bureau of Labor Statistics.

Kellie Crowe, coordinator of public relations and marketing at the community college, said the college only had one female student when the CDL program started in 2016 — until this semester.

The CDL program was initiated to fill a need for qualified drivers in the community. It’s estimated more than 48,000 additional truckers are needed nationwide.

All of the female students said they are ready for a change and to embark on a career that can lead them just about anywhere.

Mary Sue Thomas, of Meadowview, said she loves to travel and believes her new truck-driving career will be an opportunity to make a good living.

“That’s the exciting thing about it,” said Thomas.

But getting involved in the field can be as much about learning the culture as learning new skills. The women in the course had to pick a CB radio handle name to communicate with other truckers on the road.

Thomas chose “Booshie” for hers. “It kind of means ‘uppity,’” she said.

“When our instructor told us to wear old clothes because we were going to get dirty, I thought he looked right at me,” she said, laughing.

“The first day of class, I did come with my hoop earrings, blue jeans and boots. I’ve downgraded quite a bit since then,” said Thomas. “But I always keep my nails done.”

Ruth Thomas, also of Meadowview, has been a medical assistant and worked in medical records for numerous years. “I’ve wanted a new career. I have friends who are truck drivers, and I’ve been interested in it for a long time.”

FastForward

Because the Workforce Development course is provided through the community college, Virginia residents have access to a program called FastForward, which was created by Virginia lawmakers to boost workforce training to meet the needs of businesses in each region of the state.

According to FastForward’s website, more than 14,000 credentials have been awarded throughout Virginia since the program was launched.

“For people looking to get a job, advance their career or create more opportunity to support themselves and their families, FastForward is the quickest, most affordable option in higher education today," according to materials published by FastForward. "The program is a short-term workforce credential program to train Virginians for top, in-demand jobs across the commonwealth. Most programs take between six to 12 weeks and are built so that students can get their education while they work."

Crowe explained that a typical CDL course costs $4,000, but through FastForward, which is partly subsidized through a state-provided grant, the classes are only $1,333 for Virginia residents. If students qualify for financial assistance, the price would drop to $133.33, she said.

Robert Phillips, coordinator of Workforce Development at the community college, said, “Individuals' lives and the financial situation for families in our service region have been greatly enhanced as a result of the FastForward programs. CDL is just one of those programs.”

Behind the wheel

According to Stacy Bayse, instructor at Roger’s Trucking Co., the course offers classroom instruction and behind-the-wheel training, all of which prepares the students for pretrip, driving and road trip examinations at the Division of Motor Vehicles.

“During the pretrip examination, students have to identify more than 100 parts of the truck. They have to know what it is, the condition it’s in, how it’s mounted and what could be wrong with it,” said Bayse.

“Before they start a trip, they need to check marker lights on top of the trailer and tractor, check the windshield, look for leaks under the truck, check the grill, headlights, turn signals and bumper. They need to check air filter canisters, heater hoses and water under the hood.

“It’s a lot to learn in a short amount of time. Then, throw that on top of having to learn how to back a truck — especially for someone who’s never done it before. We’re going completely against the grain of everything you know.”

The women truckers said one of the most difficult things to master was maneuvering the trailer.

“You have to learn the lingo, too,” said Mary Sue Thomas, with a laugh. “‘Put the truck back up under’ means to put the truck under the trailer while backing up to make it even with the trailer.”

McLean said downshifting was probably the hardest thing for her to learn.

“This is nothing like driving a stick shift. If you ever drove a stick shift, you have to forget about driving that stick shift because this is a whole different ballgame,” she said.

The women confessed there have been many days when throwing in the towel seemed an easier option.

“There were a lot of days when I wasn’t sure about anything,” said Mary Sue Thomas. “Some days I got in the truck and everything went smoothly, and other days I couldn’t hit a gear or back it up. It’s a learning process.

“The trainers here are awesome. They sense when you’re getting stressed and encourage you to take a breather.”

Women in trucking

“We really like the fact that more females are showing an interest in truck driving,” said Phillips. “When you think about their attention to detail, their tendency to be meticulous about things and how they are safety-conscious, I just think it’s a perfect fit for women who want this type of career.”

The students said they already have started looking for potential employers.

“You’d be surprised how quickly companies will call you once you like them on Facebook. It’s almost immediate,” said Mary Sue Thomas.

According to the American Trucking Association, there were 3.5 million truck drivers in the United States in 2018. More drivers are needed to keep up with the increasing numbers of consumer items carried on America’s highways.

Bayse said he’s seen more women become interested in truck driving in the past few years.

More trucking companies are hiring women truckers. According to a report by the American Transportation Research Institute (ATRI), women outperform male drivers in safety behavior, resulting in fewer crashes.

An analysis by ATRI found that male truck drivers are 20% more likely to get into a crash than their female counterparts.

Some of that could be credited to biology. Women are more risk-averse because of their maternal roots, according to the agency, and women are more willing to admit what they don’t know, to ask for help and to learn and listen, said the ATRI website.

“I think it’s all about personality,” said Bayse. “I’ve seen women who were fearless in the face of anything, but I’ve also seen fearless men, too. However they are at life, they usually go at this truck driving the same way.”

As the female students prepare for their new careers, they believe it’s only normal to have some fears starting out. Their advice to others is to give it a try, despite the challenges they may face.

“Every day gets a little better,” said Mary Sue Thomas. “You get more comfortable with what you’re struggling with the day before. Driving a truck takes a lot of skill, but if women set their minds to this, they can do it.

“Truck drivers are held to a higher standard because we’re professional drivers. And once you get behind the wheel, all the fears go away.”

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At a truck stop in Ridgefield, New Jersey, driver Paul Richards reviews a notebook where he tracks miles driven and what he is hauling. His paycheck is down about 25 percent from the same period a year ago, and his weekly miles have dropped as well.

"This hasn't been a very good week," said Richards, who carries building materials and recycled goods through the U.S. Northeast. "Last week wasn't, either."

Across the United States, drivers, regional operators and industry officials say the $700 billion U.S. trucking sector slipped in late 2018, with the fall continuing into this year. While the decline in freight rates and hauling does not suggest the United States is headed into a recession, that softness is consistent with slippage in the economy as a whole.

The effects have been uneven nationwide, with weaker orders and miles in the U.S. Midwest and Southeast than on the West Coast, economists and regional officials said.

Trucking accounts for 70 percent of U.S. shipment tonnage, and is key to supplying the manufacturing, construction and retail sectors, all of which showed sluggishness in the first quarter. The most common factors for the decline include the U.S.-China trade war and weakness in the Farm Belt.

An ACT Research index of truck carrier volumes that surveys about 60 fleets crossed into negative territory in November for the first time since July 2016. It briefly returned to positive territory in January but dipped again in February. It matches forecasts for a soft first quarter for U.S. gross domestic product, which is expected to come in at 1.8 percent growth, according to Reuters polling.

"Clearly, the economy is slowing down," Kenny Vieth, president of ACT Research, said in a recent interview. "When the economy moderates, the trucking industry can be exceptionally worse than the overall economy because of the deep cyclical trend that characterizes the industry."

To be sure, another indicator, the American Trucking Associations tonnage index, is at a healthy level at 117.4, still far above recession-era levels between 2008 and 2012, when it remained below 90.

REGIONAL SOFTNESS

The industry's softness is not uniform nationwide. Reuters spoke to 47 out of 50 state trucking associations, and of those that responded, 16, including Illinois, Wisconsin, Ohio and Tennessee, said activity had slowed. Another 16 said there was little change, and the rest could not say one way or another.

Shipments in the Midwestern and Southeastern United States have been hit harder than other regions, according to Bobby Holland, vice president and director of Minneapolis-based U.S. Bank Freight Data Solutions. In the Midwest, export tariffs on crops have hurt agricultural sales, and auto production is also moderating, he said.

Neal Kedzie, president of the Wisconsin Motor Carriers Association, said activity started to slow at the end of 2018. Brokers had been connecting trucking companies known as carriers with requests from those who needed to haul freight. Now, though, carriers are starting to reach out to brokers to find loads.

"Carriers are having to do more searching on their own versus the brokers, who (before) had so much to deliver that they couldn't find enough trucks," Kedzie said.

Northeast shipments were strong last year, U.S. Bank said, but state officials in Maine, Connecticut and Rhode Island all told Reuters that early 2019 has been weaker.

A year ago, Larry Hobson was driving 14 hours a day hauling refrigerated food from Tennessee to New England. Now he is working eight or nine hours a day, and his paycheck has dropped by about $1,000 a week because of the decrease.

"I am a lot less busy," he said at a service center in Darien, Connecticut.

PROFIT WARNINGS

Spot total rates for freight have slumped as well, averaging $1.85 per mile in March, according to DAT Solutions, a freight exchange company. That's the lowest seasonally since 2017.

That weakness is starting to show up in company results. In mid-March, Chattanooga, Tennessee-based Covenant Transportation Group Inc warned of weak first-quarter results, saying average freight revenue per tractor was down 5 percent in early 2019 from the year-ago period, with average miles down more than 11 percent.

"The truckload freight environment has been weaker this year from late January through mid-March," CEO David Parker said in a statement last month. Covenant shares are down more than 20 percent in the last six months.

Analysts have lowered quarterly per-share estimates for J.B. Hunt Transport Services Inc, Covenant and service company Knight-Swift Transportation Holdings Inc by 9 percent, 40 percent and 5 percent, respectively, according to Refinitiv Eikon data.

"There's no doubt that we have been seeing a deceleration in volumes," said Bob Costello, chief economist for the American Trucking Associations (ATA). "This is an indication that the economy is decelerating."

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At week’s end, police in six states will collaborate on an enforcement effort aimed at impaired — both by alcohol and drugs — drivers, and their choice of dates is no coincidence.

Police in Kansas, Iowa, Nebraska Arkansas, Missouri, and Oklahoma will focus on impaired drivers Friday, April 19 and Saturday, April 20. The crackdown takes place at this particular time because April 20 — 4/20 — is an unofficial holiday of sorts for many who smoke marijuana.

A statement from law enforcement officers involved in the effort said they “will be extra-vigilant when patrolling around city, state and federal highways. Deaths and injuries continue to increase from both alcohol and drug-impaired drivers. Regardless whether a drug is legal or illegal it’s a serious crime to drive while impaired by any drug.”

Police agencies say all available officers trained in drug recognition and impaired driving will be out in force. Officers will issue citations to any individual who violates traffic laws. If a suspected violator refuses to submit to a blood test, a search warrant may be obtained to test the individual’s blood.

While marijuana — both for recreational and medical use — has been legalized in some states, it remains illegal for drivers of commercial vehicles to use it.

The history of 4/20 being synonymous with smoking marijuana is traced to a group of California high school students who met at 4:20 p.m. most days to smoke in the early 1970s.

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BAKER, Calif. (VVNG.com) — The California Highway Patrol is asking for the public’s assistance in locating a tractor-trailer and driver who fled the scene of a fatal crash on the I-15 freeway.

It happened Saturday, April 6, 2019, at about 4:30 pm, when 911 dispatch received a call reporting a pedestrian hit by a semi-tractor trailer.

Emergency crews responded to the scene on the southbound I-15 freeway, north of Afton Canyon Road in rural Baker and pronounced the victim, identified as Casey Jolly, 42, a resident of Temecula, deceased.

According to a Barstow CHP news release, the victim was standing outside his white Ford F-150 that was parked along the right shoulder of the freeway when he was struck by a tractor-truck towing a cargo trailer.

The 42-year-old male came to rest on the right shoulder and the tractor-trailer fled the scene and continued southbound on the I-15.

The Barstow CHP is seeking the public’s assistance in locating the driver of the tractor truck. Anyone with information regarding this incident is asked to call Barstow CHP at (760)255-5900

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Figuring out how much a battery-powered electric truck will be worth after years of driving is a mystery for the equipment-leasing industry that accurately projects the value of used diesel trucks.

“The entire electric market is a brand new one,” said Jake Jacoby, chief executive of the Truck Renting and Leasing Association.

The leasing industry has years of data to guide it to the residual value of traditional trucks. It knows trade cycles, average mileage and what features used-truck buyers want most.

No such information exists for electric trucks, which have two values – their high-tech battery packs and the trucks themselves.

Truck makers built about 200 electric trucks in 2018, according to Andrej Divis, an analyst with IHS Markit.

TEST CASES

“Everybody’s going to buy a few trucks and run them for a few years. Then you’re going to have the potential for something more to happen,” Divis said. “If you really want this to break out, the fleet manager is going to want to know the residual value.”

Daimler Truck Financial has arranged two-year leases for about 50 Mitsubishi FUSO eCanter medium-duty electric trucks. Customers include Penske Truck Leasing Co., J.B. Hunt Transport Services Inc. and the University of California, Irvine.

“We came up with a fair-market value,” said Tobias Waldeck, a Daimler Truck Financial vice president. “Nobody knows what the future value of these vehicles is going to be.”

Today’s leases are test models, like the trucks themselves. Daimler keeps the eCanters at the end of the leases. Engineers will analyze how they performed. Customers avoid taking a financial hit, Waldeck said.

Waldeck declined to disclose the eCanter lease price. Daimler AG, which owns the Freightliner and Western Star brands, controls 89 percent of the Japanese truck maker.

BATTERY LEASES

In theory, the lease terms for electric trucks could be longer because of the construction of the vehicles themselves, Jacoby said. Most electric vehicles come with an eight-year warranty on the battery pack.

Up to 70 percent of the energy in the battery pack remains after its use in a vehicle. Utilities have the expertise to find uses for the remaining energy. Duke Power, for example, has an agreement with electric van maker Workhorse Group that could lead to separate battery leases for customers of its trucks.

“When a newer, more technologically advanced battery is developed, the old one could be replaced, and the rest of the truck could remain out on a lease,” said Jacoby of the Truck Renting and Leasing Association. “It is very difficult to determine residual values with the technology changing so rapidly.”

Recycling of batteries from cars, buses and other sources is projected to grow to a $2.27 billion industry by 2025, a combined annual growth rate of 41.8 percent between 2018 and 2025, according to Allied Market Research.

FINANCIAL INCENTIVES

Financial incentives are part of the picture for electric truck leasing, said Bill Van Amburg, executive vice president of Calstart, a nonprofit clean energy advocacy group.

“Some will be vehicle purchases with the leasing of batteries,” he told Trucks.com. “Some will move to transport as a service, where a monthly fee pays for truck, battery lease, fuel and (charging) infrastructure.”

Calstart and the California Air Resources Board have approved $65 million in vouchers that lower the cost of buying or leasing electric trucks and other zero-emission vehicles. Calstart also has incentive programs in Chicago and New York.

CARB recently funded the conversion by XL Fleet Electrification of 154 GMC Savana vans to run on gasoline and electricity. They will be used by the California Vanpool Authority to transport seasonal agricultural workers.

Daimler Truck Financial, an early mover in medium-duty electric truck leasing, wants to take advantage of the incentives.

“We’ve been in touch with Calstart and CARB and we’re getting more familiar with their programs and requirements,” Waldeck said. “We’re working to incorporate those.”

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