Schneider and J.B. Hunt executives say B-1 enforcement is resetting trucking market
Executives of Schneider National and J.B. Hunt Transport Services said June 10 that stricter enforcement of cabotage regulations can be one of the last steps the trucking market needs to find a supply-demand equilibrium.
Speaking at the Wells Fargo Industrials & Materials Conference in Chicago, both J.B. Hunt COO Nick Hobbs and Schneider CEO Mark Rourke welcomed the increased enforcement of rules around B-1 visas, which allow foreign drivers into the U.S. only to drop off goods and/or pick up return loads. Industry advocates—including the American Trucking Associations at the Truckload Carriers Association conference in March—have called for such a tightening, saying that the freight downturn has been extended in part by fleets abusing the visas and hiring Mexican drivers to run domestic routes illegally.
“There’s a lot of noise […] starting to spark about cabotage and I think that’s really coming on,” Hobbs told the Wells conference. “I think that’s a really big play on where cheap rates are coming from.”
Rourke told analyst Chris Wetherbee that cabotage violations impact many parts of the country, but that the Southwest and Southeast regions will benefit more from more regular enforcement.
“Just a mere threatening of enforcement drives change,” Rourke said. “Just the fact that the border started to do some more questioning and more enforcement stopped the proliferation of carriers coming into the U.S., which then means a little tightening of capacity, particularly around the border.”
The discussions around the B-1 issue by both Rourke and Hobbs were in response to questions from Wetherbee about the June 25 return of English-proficiency standards to the Commercial Vehicle Safety Alliance’s Out-of-Service Criteria. The executives said that the move is also likely to reduce supply somewhat.
Broadly speaking about market dynamics, Hobbs said he has “a little bit of optimism” that supply and demand are nearing a balancing point. That echoes recent commentary from analysts who said they see a bottom nearing and pricing dynamics improving for carriers.
