Port strike potential and trade under Trump with Flexport’s Ryan Petersen

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Are you ready to truck it? It's time for your nooner with— that's my camera. We just moved the set around, by the way. Have you noticed we got some Shelves back here. Uh, my new hard camera is right over there. It's weird to look at 'cause I got another— I got, I got a monitor right here, so it's like drawing my attention. But anyways, hey guys, welcome to What the Truck. It's Wednesday. I'm Dooner. I am the, the shaven Dooner. Now the man next to me is actually, uh, is actually— you're like the, you're like the shaggy face now.

Little bit, yes. Shaggy face, little long hair, still sticking to the hippie roots.

Mr. Hippie. Who I got with me today?

Andre Hippix on behalf of Hippix Logistics and Expediting Community.

Man, it was good to see you. It was good to see you over at F3 a couple weeks ago.

Oh yeah.

Did you have a good time down there?

Yeah, I got on the last day. It wasn't really planned, but thank God I went in, got to see you, got to see the awards and a couple of fun things going on. So it was a pleasure.

By the way, I got to give a little shout out, little cowbell to my kids. They got orange belt test tonight. Boys, they've been in, uh, they've been in, uh, uh, Kenpo for since like February this year. They used to do baseball. They didn't want to do baseball. I said, you got to do something. You got to learn how to throw them hands, kids. They're 8 and 10. They're going to be orange belts, man.

Oh, it's time to fight off the bullies.

I should have had them come in to like demo some moves on you. Hey, before we get to you, have you heard the big news? Everyone was talking about this yesterday. DAT acquires Trucker Tools. It was a big story on freightwaves.com.

A lot of acquiring has been going on since— for the last couple of years, huh?

Yeah. What do you make of this big acquisition though? Because DAT, big load board, now they bring in all the different Trucker Tools, biometrics, all those kind of things.

I mean, interesting to see. Time usually plays things out hopefully fairly. I'm curious as to how that's maybe gonna impact the expediting community, 'cause again, we're still not having all those tools and resources available.

Do you use DAT?

Not as much. We do have, uh, just a few straight trucks, yes, but it's not common. We need different tools that will provide the same analytics.

Well, I got a warning for you in a second, but I thought Matthew Shore right here, he's VP of Sales and Marketing at Ship Smarter. He had a great take on LinkedIn over this acquisition. He said DAT's acquisition of Trucker Tools has me thinking, Was this really about a load board, or is the driver app technology the true value? The standout for me is their plan to use AI and biometric tools like driver photo verification to prove the right person is hauling the load. This could be a game changer. It builds trust with brokers and shippers, reduces risk with unauthorized drivers, and could streamline freight processes. But will drivers push back? Privacy concerns are real, so DAT will need to show the benefits. If they could pull it off, this could give DAT a serious edge over competitors like Uh, Convoy, new Convoy platform. Ryan Petersen will be on today. We're actually going to talk about that relaunch a little bit. Uber Freight. And then he says, what do you think is a smart move for DAT or a risky bet? Link in comments, which was to the story. Well, our own Craig Fuller, CEO and founder, he put out an op-ed on FreightWaves and he tweeted this out. He, this is Craig Fuller. He says, I wrote an op-ed today about DAT's user agreement and how no prospective customer should sign that agreement. Here's the reason why. He says the specific provision that should be called out is 2.5 of their product and delivery schedule, which states exclusivity Within our written permissions, you will not contribute rate data to any other service which aggregates data for the purpose of providing trucking lane rates and is reasonably deemed a competitive service by us without. This is your data, but DAT forbids you from exercising the right to use your data as you see fit. This is not something that any other freight rate software provider demands of their clients. I strongly recommend clients demand this provision removed from their DAT agreement. They have waived this in the past for certain clients. It's your data, not theirs, DAT's. Sneaky section 2.5, sign away your rights, suckers. Sonar says, keep your data, we're cool with sharing. A lot to consider here now, right? I mean, how many times do you just skip right through a user agreement and you're like, whatever, everyone signs these things, who cares?

The same way we handle sometimes broker agreements because it's right on the job, having to sign everything right on the spot just to get the job going. Yeah, I agree. Sneaky.

Well, Reed Lucilat says, 2025 New Year's resolution, read terms and conditions for sites that I sign up for. You know what? There's so much talk about AI. You know what we really need? We need like an AI that can read agreements for you and flag like anything that's spurious. Does that exist? Has someone come up with that?

Oh, interesting. Hopefully Happy Robot maybe will. Maybe they'll add another, maybe another service to them.

That LLM was pretty smart. I don't know if you saw that demo.

Oh yes, I did. I did. I thought it would be really great for a broker and a carrier to have that conversation and book thousands of jobs just in a second.

Geez. Well, Benjamin Gordon said, this is textbook anti-competitive behavior. It's exactly why the FTC exists. Companies should not be bullied into a position where they are unable to share their own data with their own partners. And again, that's where these agreements, especially as data becomes more important and more valuable, and it's not just table stakes. 10x Logistics Expert says, why would any shipper sign that? I might if they pay me an annual fee. It makes sense. Say like $2 million. Otherwise they can fuck off. He's unhappy. Bill Packett says, and not Even to mention how much DAT1 is a massive, massive downgrade to DAT Power. I've heard that before. Uh, Rand Radom says this is exactly how monopolies happen. The DAT locking up user data will, can stifle competition and innovation in the space. There needs to be more outrage. Michael Lund. A lot of people think this sounds like an antitrust thing. I don't know. Are you going to look over your DAT agreement?

Who?

I mean, now that you're bringing this up, probably. I'm curious, what do you think is going to happen to companies that don't sign it? Or don't agree to it.

Well, that's just the thing. Do they get access? Are you able to get out of these agreements? I don't know. We'll have to learn more on this one, but a good call-out from Craig Fuller and something to be mindful for. Now, one of the reasons you stopped by is we have the annual freight industry Christmas tree and you DM me and you're like, Dooner, I should stop by. I've got an ornament for you. First of all, what do you think of this year's tree?

I love it. It seems like you have a lot of friends in the industry and you definitely should. And everybody's bringing the gifts, right, leaving them on the tree. So I thought it would be very appropriate for us to do it too, considering that we're so nearby. You're practically a neighbor.

So, uh, so what did you get for, uh, this year's tree, my friend?

Well, we, uh, I went and I got this nice little present, and it's Thelma and Louise, very special, limited edition, Hippix Logistics sticker on it. And it's a classic movie, a movie that, you know, I think it was the starter of like the feminist movement, and it showed a trucker, an actual trucker there in a movie. Funny thing, I think he's a fine specimen of man showing why the feminist movement started in the first place. And then quick little fact, an interesting fact about the— Cali Corey, who actually wrote this movie, I had no idea because when she wrote it, I was just like 1 year old, a little baby across the country or across the world. But when the Nashville TV show came out back in 2017 and '18, I happened to be on the film set because I was doing some stand-in background work, and I got to rub shoulders with the maker of Nashville TV show. But really what's kind of cool, the classic Thelma and Louise movie, which I had no idea, and I just recently found this out. So I thought it would be kind of appropriate to bring this in here.

You know, there was a young Brad Pitt in that particular movie.

Yeah, he made $6,000 for his role, and it was a fight for that role apparently, and he won.

It wasn't a fight for that role. Hold on, I gotta tip the band really quick. Is your freight brokerage drowning in manual tasks, paperwork, and emails? TIE TMS has the solution with AI-powered automation. TIE streamlines your workflow then from quoting to carrier sourcing, letting you achieve more without adding headcount. Book a demo with TIE TMS. Visit tiesoftware.com. All right, Andrej Hipic, so Ryan Petersen should be joining us. He hasn't signed in. So let's hang out with you for a little bit over here. Let's talk a little bit about this year in Hippix Logistics. What have y'all been getting into? What do y'all do?

Oh, wow.

Loaded question. So this year has been a school of hard knocks.

Really?

Yeah, very hard knocks. We learned a lot of things about the insurance renewals of insurance and how that's— that can be a very big problem to experience as a carrier. We've learned— we've had, unfortunately, a situation with an owner-operator that was an imposter and ended up stealing freight out of 13 13,000-plus shipments, we had only one. So I think it's a good metric, but the owner-operator did happen to be unfortunately an imposter and a fraud, and hopefully will never work in this industry again. So we had to learn that. FBI, police, 5 different states, a month over investigation. But we're sticking to our guns. Again, we're still representing and advocating for the drivers, specifically in expediting industry, which is what we do. Sprinters, cargo vans, box trucks, things that need to address the fast deliveries and when things go wrong in the industry, in the businesses. And our hope is that the current discussion that's been going on on the broker transparency, if that's not a solution to the problem, is just at least going to point everybody's attention on that, that there is a problem. There is lack of trust between carriers and brokers. And we've experienced it. Obviously, one broker experienced the problem with us now that one of our owner-operators decided to steal freight and just disappear into the abyss.

Um, but you don't know where this guy is at all?

We know where he lives. We have, I think, 5 different addresses linked to him. I, I specifically myself spoke with 6 different police departments, FBI, provided all the information, addresses, everything. Um, and it's a, it's an ongoing investigation. Apparently it's not that easy. Uh, but I, I think that justice will be served, and this gentleman unfortunately will have to either go to jail or he will, you know, Pay for the consequences eventually.

Andre, this is such an important topic. I'm glad you brought it up. But I bring it up often. Aside from sort of the freight recession, fraud has been the biggest story of the year. It's what I've been talking about, that massive run-up of it, all this trust that's been broken down. Take us inside the story a little bit, because one thing I always talk about is when these kind of cases happen, it's not transactional. Theft isn't transactional because it can harm the future relationships with these other customers because people go, they got to blame somebody. Right. And the freight disappeared under somebody's watch, so they get blamed. Tell me a little bit about how this happened. What was the fallout from all this?

Yeah, well, so this was a regular job. It was a cross-country job, which just kind of made it a little more difficult. It started in California, was going to Miami, Florida. So you can imagine a lot of districts, a lot of states. It's a federal thing. The owner-operators were doing great. It seemed like everything was fine. Picked up the job. Something was wrong with the tracking as far as the software goes. So, you know, this driver worked with us for over a year. We knew his wife. They were a team sometimes, sometimes single drivers. We stuck up for them many times when they had some financial problems. We really took them in as a family. Let's put it this way. There were some issues before. We spent hours talking with them virtually, addressing situations. So we again stood behind them and told our broker, which is a great company, great people. They've been very understanding and took a lot of time. to address the outcome and the solution to this. We stood behind the driver and we said, look, guys, we're going to give you manual updates. The driver's providing, he's communicating there's something wrong with his phone.

Yeah.

Well, the job kept going until all of a sudden we're just not hearing anymore from the driver. And then from Dallas, Texas, till about Miami, Florida, we don't hear anything from him. And all of a sudden we hear back, oh, guys, I'm sorry, I had a bad phone situation. I delivered the freight. Well, the freight never got delivered because when the broker contacted the customer, customer was there on site and the freight never got delivered. So he was trying to get paid right away because we offer quick pay to our drivers.

Yeah.

And at least score that money. And the freight was with him. It never got delivered. So then since then, we jumped into an investigation process. I spoke with Miami, Florida. I spoke with California, Los Angeles police. Nashville, Tennessee is where we're located. Chattanooga, where I currently reside, Dallas, where the driver resides, and submitted 3 or 4 different reports. At the end of the day, right now, the insurance is handling the claim. We're working closely with the brokerage. I almost feel like this has definitely bridged the gap between us as a carrier and the brokering company, and we really work together to make their customer, you know, with the least amount of damage as there possibly is and replace the product as soon as we possibly can. But it's been a big ordeal, and it's been a very big learning curve as to how law enforcement works in this case, what we need to do, who do we contact, how do we proceed the chain of command when things like this happen. And knowing that FMCSA really, they're— well, they're not really going to be of help.

Yeah.

You know, apparently big companies— we're not one of them— big companies hire private investigators, and these guys cost thousands and thousands of dollars, and we're just not in that place. So we had to do a lot of labor, manual work ourselves.

Now let me ask you, was this driver using his real identity?

He was using his real identity. But interesting enough, the guy had 2 identities, and they're both—

Look, I can see Ryan in the green room. You guys are both like— I'm the clean-shaven one out of you 3. What the hell's going on here, Andrei?

You came in clean. Of course. It's a big guess.

You know, I'd be presentable.

Yeah, of course. Well, we have we have to balance each other out.

Thank you, Ryan, for for joining my crew here with the little before before I let you go. What what are you going to be doing in 2025 to protect yourself from a similar situation? What advice do you have for everybody?

Oh, ah, it's it's it's onboarding compliance. Yeah, it's really preventing these issues by strengthening the onboarding of the drivers, owner operators as a carrier, and we've we've really jumped into that pool very strongly and hopefully getting some contacts in the law enforcement that, that can really go above and beyond because the local police officers are, they're not that great of a help.

Well, Andre, hey, thank you so much, man. Merry Christmas. Happy New Year for stopping by. I hope this all gets resolved for you. I mean, thank you all for sharing these stories too, this freight fraud. Like, this is real. These aren't just statistics. These aren't numbers. People are actually getting impacted. Um, exit stage right. And how about you hang that on the tree if you like?

Uh, would love to.

The Thelma and Louise car.

Yes, sir.

Well, Andre, thank you so much.

Thank you, Tim.

Take care, buddy.

Let's take a look here.

Get on over there. Get on over to that tree, man. Where's he gonna put it? Perfect spot. Perfect spot. Thank you so much, Andre. By the way, everybody, you're looking for something to put underneath your Christmas tree, go to wttgear.com, get a Make America Free Again hat. Right here, or scan that QR code. WTTFans— no, wttgear.com. Sorry, use code WTTFans, get 10% off. It's the, uh, the Christmas tree that's storming the nation, the Christmas gift. All right, now we're gonna get Ryan Petersen, CEO and founder over at Flexport. And Ryan, yo man, pimp this, uh, pop the sweater right here.

That is— I, where did I— I don't have one of those. That is sweet.

I have an extra one in my closet. I'll mail it to you.

I know some people I should probably get be able to get hooked up.

I still wrap this. I actually I sent Bill Dreger a picture of myself wearing this because I assumed he would he would be pretty excited about all that.

For sure. Well, Ryan is also by the way if my last name was a Hipix, I would also name my company after myself. Hipix Logistics.

Yeah, no doubt, man. He had another story about fraud, man. Freight fraud's been such a has Flexport dealt with any of that this year? I mean, it's been so massive.

Um, we've had very little, but it's a big part of Convoy's technology stack. Uh, you know, when we were first— when I was evaluating the deal to acquire Convoy's assets, to acquire the technology and the team, uh, I was really kind of surprised and amazed that I think they had a 120-page technology slide deck about everything they've built, uh, well, all the software and platform, and like 60 pages of it was about fraud and compliance and avoiding Avoiding this by tracking things, by validating with 6 background checks on every load, et cetera. So it's a big part of, a big part of what tech can do.

How has this year in Flexport been? You, you've been back in the saddle for what, like about a year, 2 months, year and 3 months now? You, you jumped back into the CEO chair. You've been super active. You're a very hands-on guy. You like communicate through your forum, your X, you put yourself out there. How has this past year been though?

Um, it's been a renaissance, although the first 6 months was like the hero's journey where you have to go to hell and back. Um, it was tough. I, I think that that's the kind of story people love internally. It's been really motivating. Um, we, we had an incredible decade run to scale, became one of the largest freight and logistics providers in the world, and then we hit some— the kind of pandemic, I'd say, like, kind of knocked us off kilter a little bit. Uh, we— it was really good for us financially, but Our service quality wasn't where it needed to be. The whole industry was— that was true for everybody. But we also exposed kind of some of our operational weaknesses where, you know, you just assume that the containers will get picked up at the port, it won't be a problem. And then all of a sudden, some of your systems are dialed for that assumption. And we just like exposed some areas of weakness for us. We brought in CEO Dave Clark kind of famously, and then about 6 months later, it was obvious that like company needed to be led by the founder. board asked me to come back. So the results, I mean, on the top line financials has just probably been the best place, although I'm not sharing that right now. We're almost where we want to be and be able to do a big celebration of the full turnaround. But the results are incredible on the financial. The thing I'm most proud about though is our quality. Our net promoter score had really been suffering and November was the highest since Way before the pandemic. We had a 72 Net Promoter Score last month. Net Promoter Score is a very brutal metric. The average in the benchmarks that I've seen in logistics is 38. The way you measure it is like you get a 9 or you get a 100 score. You survey all your customers, you ask, how likely are you to refer a friend? If they give you a 9 or a 10, that's worth 100. If they give you a 0 through 6, that's worth minus 100.

Ooh.

7s and 8s don't count. And so you average them out, or 7s and 8s count as 0, and then you average those all out. And so to get a 72 means almost everybody's saying 9 or a 10 out of 10. So that's the main metric that I've been focused on is bringing that love back from our customers. So it's going great.

Yeah. During the pandemic, things were easy. I almost retired and became a Robinhood trader. I was doing— because you could be stupid, but everything just worked, right? And in freight, it was easy to make money because there was that lack of capacity. There was so much chaos. But what lesson, when you came back as CEO, did you take from, from the, uh, that whole experience where some corners don't get swept?

Um, the main thing is ownership. Uh, you know, logistics is complicated, and we had moved really hard on efficiency. We've built this great software that's a workflow engine that defines who should do what on a given shipment. And assigns that as an item-level task that's so simple a CEO could do it. It's like really dead simple web forms and a lot of automation, a lot of— even more every week, by the way, large language models automating some of these very simple tasks. So that part's nice. It's great software. But the piece that we made a mistake was in pursuit of efficiency. We had people really specializing in a set of tasks and doing them over and over again across a huge array of shipments.

Yeah.

And we weren't getting the ownership of outcome of like, yo, you're responsible for whatever happens on this shipment. And so when something did happen, which was super common in the pandemic, and by the way, it's basically inevitable— sorry, I forgot to turn my phone off— basically inevitable all the time that there will be some kind of exceptions or problems and stuff comes up. That's the nature of global logistics. We didn't have enough ownership over those outcomes. And so that was the biggest shift we made was Still use the amazing workflow engine, but now have one person owning that shipment and following it on its journey and doing all the tasks. Actually, we moved to one at origin and one at destination, a few specialists that have to step in and do certain things. But basically, you have the ownership is super clear. So when something is wrong, happens all the time, logistics is hard, there's like someone really stepping up and taking ownership. That was the— it should have been obvious to us. By the way, it was obvious to us for many, many years. We drifted away from it. In pursuit of efficiency during a brief period of time here. And we're back. And that's what's driving the net promoter score, the better on-time performance. By the way, it's also more efficient. All the inefficiencies, almost all the inefficiencies in logistics come from bad quality.

Yeah.

You have to rework the data, rework the shipment because someone screwed up upstream. So we go slow to go fast in many cases, get the data right, get the quality right.

So Ryan, like I, I was forged in my start in this business was in the forwarding world with, uh, FedEx Trade Networks. And my job was doing import air and ocean entries for clients like Reebok. And a lot of my job was taking that file and you get, they had a system called Duplex at the time. I don't know if y'all still use that, but you're tabbing through a system and you're putting in all like the data in there and it's a ton of keystrokes and it's a big waste of time. Have you had any AI luck with automating the process of doing entries?

Yeah, that's what I'm saying. We're now, um, customs entries in particular, as long as we're getting data in a clean format, which not every customer can do. So that's a big part of the onboarding and implementation is going through with them, getting, making sure they have clean data in the right formats. They have what customs needs, what we need to create those filings. But for some of our larger customers where they have these databases or we can help them create them and create the process flows now, Customs entries are basically a quick audit process from an experienced person in customs compliance rather than people doing manual entry. And that's also— so that's like fully, highly, highly automated and automatable by working with the customer. Then just generally, we're seeing AI be able to do most of the tasks. We're automating about 1% of all the tasks that are required to move a shipment from door to door. 1% every week. So, uh, for the last 6 months, it's been an incredible kind of just turning the crank on automation. A lot of that is unlocked by large language models. We have a great partnership with OpenAI and a few others. Um, so this is, uh, the, the— and, and like, you'd ask me 3 years ago, I'd have to be like, you know, theoretically it's great, but we're mostly focused on user experience and being higher quality and what we can do to be a real premium provider. And now I think we can be a low-cost, low-cost leader in this industry just thanks to our rapid adoption of AI. And probably selling my own book here, but I feel like we're in the best position to do that because we are at scale. Flexport's the 3rd largest American air and ocean freight forwarder, top 10 globally on the key trade lanes. We're also the youngest in the industry. We have tech talent. We build our own software, like our own workflow engines, our own database systems, like the full— almost everything we do is homegrown, which lets us just add AI models, run the models ourselves, uh, and just— we just pick up any point in that journey end to end from factory all the way to consumers' doors now with our acquisition of Shopify Logistics. And you can just Go apply AI, go apply large language models. We're using it for like, man, there's like 50 different AI projects happening in parallel right now, at least.

So many. So all I hear about every day, Ryan, is just more and more AI. If it's not a press release, it's from a guest or it's announcing another—

By the way, I was super allergic to this stuff like a year ago, to the hype and talking about it. And now I'm just like, oh, like I see real-world examples in production. Every day. I'm like, yeah, I have to talk about this. It's incredible. It's blown my mind.

I mean, it's happening. I know some of it's been a little bit janky, but you can just look at it and go, okay, I can see where this is headed though. And it's at a point where limited but exciting, and it's starting to make some sort of difference for somebody. But let's talk to, let's talk about the physical world, the world of actual freight. You put out a great tweet. It said every container ship in the world with a Flexport container on board right now. We got that tweet. It's got a map with all the container ships on that. How, what are we seeing for freight flow right now?

You've seen a big surge in the last few weeks because of— I mean, you can always make a reason after the fact.

Yeah.

I think it's because we're awesome, we're crushing it. But I also think there's market conditions here. We'll see. I haven't seen the latest market data for a couple of weeks, but the fear of tariffs coming has caused a lot of our customers to pre-book, try to get containers if they have the goods. Get them in as fast as they can before tariffs hit. So you're seeing some of that behavior. Um, there's probably some fear of the port strike on the East Coast rearing its head again, um, causing people to pre-book. So you're seeing— I think our bookings for freight, um, last week were up 30% over the prior month and over the prior— that just like this big bubble of freight. And it's not— December is not usually like peak peak peak season. We're post-peak, um, and this year had an early peak season as people were trying to pull stuff in before the port strike, the earlier fear of a port strike back in, uh, end of September. So yeah, it's a— the market seems— the ocean freight market seems pretty robust.

You know, I saw a very interesting report by, uh, creditcards.com yesterday, and it said 22% of Americans plan to make a large purchase before the end of the year. Many are motivated to buy ahead of Trump's tariffs, which is really interesting because if you think like, I remember I was in Walmart right when the port strike was happening at the beginning of October and there was like a rush on toilet paper. So like strikes tend to like get in the American psyche for toilet paper, but usually supply chain doesn't seem to spur buying except during like the pandemic. But now you're seeing people hearing about these Trump tariffs and actually going and making gifts in advance. Usually it's really interesting. It's really unique, but hopefully that keeps the freight flowing. What's your sort of Prognosis on trade with Trump and how that impacts things here?

Yeah, I mean, well, toilet paper is made in America mostly, so we shouldn't have to worry about that. That's people being a little alarmist. Um, the, uh, the— and generally that's kind of true of the United States. Like, we produce the vast majority of what we need. That's some of our consumer electronics and apparel and some stuff that maybe is better at branding that's not made in America, but like, we're independent in food and energy and kind of the core things that you need, most of the building materials, raw materials, stuff like this. So like, I think, um, we benefit more than most countries from the fact that we're just like a huge country with incredible natural resources. The, um, that said, the tariffs are likely coming down the pipeline and, and in a little bit unpredictable ways, knowing which country will be affected. Everybody assumes China, um, but now you start to see Uh, threats against Canada, against Mexico. Maybe Canada becomes the 51st state. We'll see, see what Trump can get done. Um, but maybe that—

And there's so much because like even final mile with the USPS, right? So like we got USPS, there's, there's drama. There's drama on both borders with these other tariffs.

Canada Post too. Canada Post has been a nightmare for people shipping to customers in Canada lately.

Is— do you think 2025 is going to be a hell of a lot crazier than 2024 was?

I never know, man. I'm ready for anything. I we we it I think that it'll be entertaining. Hopefully, hopefully peaceful.

Well, you you put out some odds. You started this poly market. Do we have the chart right here? It's at forty nine.

Yeah, pull it up.

It's at forty nine percent right now. When you initially posted this, you were like sixty percent. I think there's sixty percent odds. Then like five minutes later, you're like actually just got DM'd a bunch, and I'm moving that to eighty percent. The the bettors have it at forty nine percent. If you remember on the auction. This thing was correct with the Trump presidency. It had tracked very well. Right now at 49%. Do you agree with this chart right here? What should it be at?

You know, I think— thanks for calling attention to it. We should post a link in the show notes here. It's on— if you search that headline, East Coast Sports Strike in January, it'll come up. It's a little thinly traded at this point. You can see the volume there. It only says about $47,000 have been traded on this market. Which means if you bet like a thousand bucks, you really change the odds. So I'm not sure how much confidence I put in it. I think as it gets closer, I hope that this page—it would be fun for me personally. Also, it'd be great to have a betting market that gives some people a sense of what's going to happen. I hope we get some media attention and like you know you're doing your part here. But I hope more people find out about it. It's hard to get signal out of a thinly traded market. But if you got—if it—if you know—is this thing become as the port strike becomes newsworthy again, which probably. Beginning of January, I suspect that's what you'll see. Then, uh, then yeah, this might be a good signal. 50/50, I don't know, coin toss. Trump's latest statement in kind of favor of the union maybe makes me less likely to believe that there'll be a strike, that he'll kind of just force all the parties to the table and use the threat of presidential power to prevent a strike. He really doesn't want to start his presidency with that. You know, he's got an agenda he wants to get to, and I don't think having to fight fires in the rear with a port strike will be in his favor. So now the current demands from the union are pretty extreme. I have to say, in that they, they, they got really generous labor offers. I think it was a 60% increase over the life of the 6-year life of the contract. So that's pretty good. They're already, in my opinion, some of the higher-paid blue-collar workers in the country. They, the carriers have conceded they will not automate the ports. So they've gotten those things. Now, what the, what the holdup is, my understanding from people who are very much in the know, is that the union wants negative automation. They want to remove automation that's already in place in these ports. And to me, that's just like a little crazy. Like, we can't go backwards on automation. That would cost you extra money just to make things less efficient. So that some of the carrier sources I've talked to are sort of just like, we'll die on this Line. We'll let them strike on that line. But that was before the president said, you know, get in line. So the future president.

Yeah, but yes, yeah, but no, what the ocean lines know is that chaos equals cash, especially down here at these U.S. ports. Sal brought up a good point. He said Trans-Pacific rates have shot up ahead of the increasing likelihood of industrial action by U.S. East Coast port workers. It almost makes one think that the shipping lines who represent the USMX would want the ILA to walk out to cause a rise in rates. Do you think there's any truth to that?

No, I, you know, I could see theoretically why someone would say that, but having talked to all of them, they all want to continue business. Uh, they want to move their freight. They feel that that is their— their companies need to make money by shipping cargo. So I don't really see that being a real thing. It's a bit conspiracy-oriented for me. But the, um, but I do, uh, I do think there's they're not hugely incentivized to go fight on the automation point. I think removing automation, they're just like, come on, this is crazy and it'll cost us money. Let's not, let's not be stupid.

Yeah.

But they don't have a huge incentive to want to go automate things, in my view. This is not them saying it. They'll say that they want to automate everything. But if you just think about automation is a bit of an arms race. Um, and if so, if you can have a non-proliferation treaty that says, hey, none of us will invest in automation, It's kind of good. Like, you know, it's, it's on some level zero-sum game. Like, you automate things, it lowers the cost, but so does your neighbor. You got to lower your price that you charge for your port services. But if neither of you do it, you keep the price high, um, and it's a win. So, you know, if I could get all the other freight companies in the world to collectively bargain and agree none of us are going to automate anything, it'd be like, cool. Like, right now I'm automating the crap out of stuff because it gives me a competitive advantage. But if nobody could automate anything, like, all right, let's compete on Being nice, cool people. Yeah, it'll be all right. We probably win.

Live in that world though, you know. So like we have to, we have to, we have to deal with tech on tech's terms sometimes. Now, you know, Super Bowl's coming up. We're talking about ROI. There's ROI in tech. There's ROI maybe in AI. But how about fast shipping versus Super Bowl ad, Ryan? You put an interesting tweet out there, and I'm curious, what's the better investment?

Well, I kind of want to do a Super Bowl ad about fast shipping being better than Super Bowl ads, but I don't have any money for that. I don't have enough budget for that. We'll have to get maybe next, maybe 2026 Super Bowl. Super Bowl, you can look for us. But, uh, but yeah, uh, just this is fast shipping, meaning, uh, e-com, if you can offer 2-day, a lot of brands see a lift of up to 25% depending on your category. If you haven't tested it, you guys test it. If that's 25%, probably a bigger lift than anything your Facebook ads guys are going to deliver for you this year. And, um, Super Bowl ads are benchmarked to drive about 5 to 6% lift. So that's where I get the 5— that's where I get the stat from, 5x, uh, Fast shipping can be worth 5x of a Super Bowl ad. Probably cost you a lot less too, um, and deliver better cust— yeah, you're delivering a better customer experience. So certainly need to experiment with it. Uh, one of the things that I do to drive growth at Flexport is I buy a lot of stuff. Um, I'm not trying to be such a consumer in life, but, uh, but it helps. I make— I buy cool products, uh, that I like, take a picture of myself or a video of myself using it, and I send it to the company and I tell them how their shipping was. You know, I love your product, but your shipping's A little too slow, maybe I could help you out. Um, and when I do that for our own customers, that stuff arrives in like 2 days. And when I do it for other customers, it can be 8 to 10 days. So I know there's a huge amount of opportunity out there. It doesn't have to cost more. If you— the way that fast shipping will cost you more is you got to have more inventory positioned, uh, forward deployed in a few sites. Uh, in our network, it would be— we have 5 sites across the US, so you can get fast shipping Without spending more on the ground speed, you just have to buy some extra inventory to keep it in 5 different locations. So you got to experiment with that if you're in the e-commerce world. Most people already have tested it, but a lot of times it feels like you have to pay for the really expensive express parcel, and that's not the case. You can get this done at a pretty cheap cost.

Hey, if you want to get stuff places quick, air freight's a great way to do it. You were just out on a little— you took a little trip down to some of your airplanes. We have a little Be able to run. But tell me about the Flexport. I got one right here on my desk. I got the Flexport airplane. But tell me about this. Why are we out at the planes, man? What are you guys offering out there?

That is the plane I flew on. We have 3 747s that we operate. We run a network. Oh yeah, there it is. I'm on that plane right up, sitting right behind the captain in the cockpit there as it lands. We have a network of 3 flights, 3 planes that make 9 flights a week from Asia to the US. We also interline to connect all the major Asian airports, uh, either into Hong Kong or into Incheon, into, into Korea, where we cross-dock, uh, transload shipments onto the— onto these flights, and then we fly it into gateways across the US. That's, that's when we own, own our own assets. We also move cargo. Most of the cargo, the vast majority, moves on other people's planes, so we have a pretty diversified asset-light network. These actually came out of COVID During COVID when all the world's passenger planes were grounded, we couldn't get any capacity. 50% of the air freight flies in passenger planes in the bellies, um, and those were all grounded. We couldn't get any capacity. We, we signed a long-term deal with Atlas Air, uh, who's the biggest air cargo airline in the world. So there, it's their, their planes, their pilots, uh, we, we have a nice long-term relationship, so they let us paint it Flexport livery and And we operate, we're the commercial operator on the thing. So yeah, that was my first time. The Atlas was awesome. I'm rocking the Atlas sweater they gave me on the flight. They allowed me to fly as a cargo— what did they— I was accompanying the cargo doing security audit, very serious stuff. And I flew from Hong Kong. We stopped in Alaska. Refueled, cleared customs, you know, I got off the plane to go show my customs passport, and then, uh, on, on down to LAX where that video was shot. That landing, like, experience of a lifetime, honestly. I, I, I would do it every week. I, I would go to China if it wasn't— it was a hassle for Atlas. I don't want to impose that on them. They, they really laid out the red carpet for me. But, um, so such a fun experience. It was almost like a private jet travel. In the sky, because that upper deck— the lower deck is, uh, you know, it's cargo. You're not going down there during the flight. But the upper deck, they got some business class seats, they got 2 beds. Uh, I get to sit behind the pilots whenever I wanted and see the sunrise, see the takeoff, see the sunset, um, over Hong Kong. You see the mountains in Alaska. Didn't see the Northern Lights, unfortunately. They weren't out that day. But, uh, some people— man, I would do it. I would go to Asia I go 4 times a year. I would go 12 times a year if I was just allowed to fly on that thing all the time.

You can't disprove the Northern Lights conspiracy theorists, unfortunately, with that particular flight. What's— you also tweeted that, like, make sure you ask a pilot the craziest thing they shipped. What do these guys tell you, or what's the craziest thing you've shipped?

Well, we don't ship a lot of crazy stuff at Flexport. We're basically running supply chains on a loop, trying to do it better and faster and cheaper every time. So we're working with brands doing apparel and electronics and all sorts of stuff, but nothing exotic. The pilots, however, told me all kinds of stuff and they're not allowed to tell you some stuff. I think these guys all have security clearances and Atlas is like major government contractor and stuff. So I don't know anything about that, but I bet you there's some crazy stories. The elephants and zoo animals was like the one that really kind of got me. They, uh, one of the pilots had just flown a, um, flight— not on our plane, but these guys fly on other Atlas planes too— had flown a, um, plane load of ferrets to Japan. Um, and he was a little worried they were going to be eaten, but no, it turns out those are pets in Japan. Uh, and they stunk horribly. Um, a lot of, uh— oh, they fly a lot for F1, Formula 1, concerts, for like big Famous musical acts will be flying on these things. I don't know, I only, I only got to talk to 3 of the pilots about that question, but I heard all kinds of stories. I think that flying an elephant— I told them, if you guys are doing that again, I need— I'm coming. Like, I need to see this in person, how it works.

Yeah, I had United on once too. Uh, they shipped some manatees. I was able to talk about shipping manatees, and you have to use all these custom tanks. It's a huge project, but it's really interesting. It's so different than like your FAK, sort of general freight, all kinds kind of thing. But hey, I'm wearing, I'm wearing the sweater right here. How's this year in Convoy been? What do we got to be excited about?

Well, the Convoy Renaissance is in full swing. We brought them back online, I think, in February or March. Um, it's not at peak loads. It's probably about, uh, 1/3 of what it was at its peak in terms of number of truckloads, but it's pretty good from a cold start. Uh, by that— by this time next year, you'll see that it's back doing more loads than ever before. We've, we've totally changed the strategy though, um, where Convoy is really a platform now for other truck brokers and giving access to our carrier network. We have 400,000 drivers with the mobile app who are super engaged. Um, we need to get to that enough loads to keep them to where they're making us the first thing they do every morning is open the Convoy mobile app to get loads. Um, and so the way that we're— Flexport would never, you know, and even Convoy, I think, as a first-party broker, just wouldn't be able to get enough loads to keep that many drivers fed, much less like, you know, there's millions of truck drivers in the US. We want to get them all on here. So in order— the strategy to get there is to get other brokers to come on board. We've signed up, uh, almost 20 brokers so far. Uh, some big ones too that are— and we're doing some partnerships that we'll announce soon with some kind of TMS system and other, uh, tech providers to be, uh, to, to be— you can think of it kind of automated carrier sales, uh, the ability to go match your loads, cover your loads, um, for you. And if we can do that cheaper than your own team, then it's a win. We take a small cut, much smaller than a broker would. It's not double brokering because the broker just connects directly with the carrier. We're just a technology platform. enabling that match and enabling the payment flow. Um, and so works— it works really beautifully. It's just like a simple win-win model. If we can cover your load at a lower cost than you can, then like obviously everybody's winning.

Yeah.

Um, and the more brokers we sign up, the more attractive it'll be for those drivers to re-engage and new drivers to come on board. And eventually you build out this broader platform. So Flexport's not selling FTL in this model. Convoy is not selling FTL. We're just connecting brokers with our supply-side base. I think what you'll see from us, we do want to offer FTL to all the great Flexport shippers out there. We're going to do that. We haven't figured out exactly the timeline or who the partners will be, but these brokers that come on board with us will be the partners. We're basically going to allow FTL brokers to offer their services to Flexport's customer base. So we're not in that, we're not directly brokering FTL. We're just, again, a technology platform that's connecting our shippers, Flexport's great customers, with these brokers, and then matching some percentage of that load, those loads ourselves, uh, through the Convoy network. And many others that we can't cover, they'll— the brokers will cover themselves. So that's, that's the strategy. It's working great. People are— brokers are really excited that we're not competitive. Um, Convoy had offered this platform before, but they also, because they were selling FTL, a lot of brokers are like, yeah, I can't you know, I won't use you to cover loads since you're my competitor. It's too much. And that's— I think that's the problem that Uber Freight has in this space too, is being competitive makes it hard. So the fact that it's neutral, uh, people love that.

Yeah, I'll have to have Bill Driegert on in the new year to go, uh, deeper on some, uh, Convoy kind of stuff. But man, thank you so much for coming by, helping us wrap out the end of the year on our second to last show. Uh, God bless you, the family. Merry Christmas, Happy New Year to Flexport. support. Everybody go check him out. And Ryan, thank you for stopping by, buddy.

Yeah, Merry Christmas. God bless you too. God bless America.

God bless America, man. Take care. And hey, you really want to bless America? Go get a— go get a What the Truck Make America Freight Again shirt. Go to wttgear.com, use code WTTFANS, take 10% off. I mean, the freight recession may be over, but you know, got to protect those margins in your own personal wallet. Last show of the year is on Friday. It's a very What the Truck Christmas. It's my honor to have Project Canine Hero in studio. We're gonna have some hero dogs who've done service. Project Canine Hero finds them life after service with appropriate homes. We've got Tom Curry from, um, from Cued. He always does his annual Christmas song. He's stopping by. Hellbent Hagan, trucker Jamie Hagan, talking the trucker side of the holidays and driving through them. And our good friend Matt McLeanland from Covenant will help co-host as we close out the year on an amazing Time and Freight. Thank y'all for joining us. Find me on Twitter @TimothyDooner. That is D-O-O-N-E-R. Find this show wherever you get your podcasts. Just look up What the Truck Will Hit. It's a livestream on Freeways Mondays, Wednesdays, and Fridays at noon Eastern time. And of course, on SiriusXM's Road Dog Trucking Channel 146 at 5 and 11 PM Eastern Mondays, Wednesdays, and Fridays. Take care. See you Friday.

See you Friday.