THE DAILY

Tuesday, March 10, 2026

The five minutes that makes you the most informed person in freight today

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The Daily

Union Pacific CEO fires back at merger critics ahead of April STB refiling

Jim Vena wants critics of his $85 billion merger proposal with Norfolk Southern to stop relitigating rail consolidations from another era.

In an exclusive interview with FreightWaves, the Union Pacific chief executive pushed back against analysts and observers who have challenged the deal’s math since the Surface Transportation Board rejected the initial filing in December as incomplete. The STB asked for forward-looking market data and agreement details the railroads declined to include. Union Pacific and Norfolk Southern now expect to refile in April. "People have to quit looking backwards and look at what’s possible," Vena said from UP’s Omaha headquarters.

The critiques center on how the railroads categorized dray-to-rail conversions and rail-to-rail market share shifts as "growth" rather than pure truck-to-rail migration. Vena’s answer is that evaluating the deal through a numbers-only lens misses the point. "You have to look at the quality aspect, as well," he said. "The people and companies that manufacture and produce the goods we consume every day, we want to be able to give them a better rail system, one that allows them to compete against the world." The merger’s stated commitments are substantial: 1.4 million truckloads shifted to intermodal within 36 months, 2 million annually at maturity, and up to two days removed from a typical 5-to-7-day transcontinental rail journey.

On the STB’s redacted Schedule 5.8 — the "Materially Burdensome Regulatory Conditions" that define UP’s walk-away terms — Vena compared the provision to any standard real estate contract. "Why would you ever tell your competitors the financial details? It’s ridiculous." He also welcomed the STB’s proposed reciprocal switching reset, which would give some shippers a choice of carriers: "I’m all for reciprocal switching, it gives optionality." For context on UP’s growth ceiling: the railroad holds a low double-digit share of daily freight tonnage in the United States and recently committed $1.2 billion with Wabtec to modernize 1,700 AC4400-series locomotives, its fourth rebuild program since 2018.

So What? The April STB refiling is the next hard checkpoint for the largest potential U.S. rail consolidation in decades. If the deal clears, shippers running transcontinental lanes face a fundamentally different routing calculation, one where single-line service compresses transit times to near-truck levels coast to coast. Vena’s projection of 2 million truckloads moved to rail annually at maturity is not a rounding error for carriers, brokers, and 3PLs who model their capacity mix around current intermodal share. Start stress-testing your modal assumptions before the April filing lands.

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Top Stories

Federal CDL crackdown cancels 13,000 California licenses; national rule effective March 16

California cancelled approximately 13,000 non-domiciled commercial driver’s licenses on March 6 under federal pressure, after an FMCSA audit found the state had been issuing CDLs with expiration dates extending beyond drivers’ work authorization documentation. The cancellations were not driven by driver fraud; the state’s own DMV director acknowledged most drivers had followed California’s process correctly. A separate FMCSA Final Rule, effective March 16, narrows non-domiciled CDL eligibility nationwide to H-2A agricultural workers, H-2B seasonal workers, and E-2 treaty investors. FMCSA estimates 97% of the current 200,000 non-domiciled CDL holders nationally will not qualify. J.B. Hunt’s analysis projects between 214,000 and 437,000 drivers could exit the commercial workforce over the next two to three years if the rule survives legal challenge. "Trucks parked, loads canceled, and nobody knows whose license will be pulled next," said Fateh Singh of Freedom Drivers.

So What? Thirteen thousand CDLs cancelled in a single day in the country’s largest trucking market is not a minor disruption. For carriers with non-domiciled drivers approaching renewal dates, verify status now and coordinate with your insurance provider before the next dispatch, because a cancelled CDL creates liability exposure for the carrier. The March 16 implementation date is the critical watch point. If no court issues a stay, the non-domiciled pathway closes for nearly every driver category, and capacity tightens further in a market already moving in that direction.

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Tech companies pitch new tools at TCA, from GPS tail lights to AI network optimization

Several freight technology companies unveiled products at the Truckload Carriers Association annual meeting in Orlando. Highlights included REPOWR’s Trailer Optimization Platform, which automates trailer repositioning across a fleet network, replacing what the company described as a process built on "spreadsheets, emails, and static dashboards." Pedigree Technologies introduced the Tail Light Tracker, a GPS unit built directly into a trailer’s tail light, designed to evade thieves who routinely rip out standard ELD-based tracking devices. Optimal Dynamics launched Scale, an AI solution that detects network imbalances and autonomously works to correct them by winning new freight for exposed lanes. McLeod Software’s version 26.1 introduced Impact Benchmark, which draws on its broad TMS user network to give fleets comparative performance data. On the workforce front, FleetForce presented a program that converts internal employees like warehouse associates and forklift operators into CDL-certified drivers, targeting carriers that want to build pipeline without competing on the open driver market.

So What? The range of product announcements at TCA reflects where carrier investment is concentrated: visibility, cargo security, operational efficiency, and driver pipeline development. Given the CDL workforce pressure from the March 6 cancellations, FleetForce’s internal conversion program deserves a closer look from any private fleet looking to reduce exposure to the non-domiciled driver crackdown.

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Driverless truck software has matured. Manufacturing at scale is the next barrier.

Level 4 automated driving systems for heavy-duty trucks have cleared their core development phase, but the industry’s next constraint is manufacturing consistency and after-sales service infrastructure, according to new research from Telemetry. PlusAI CEO David Liu said the retrofit model, which the company used to outfit a triple-digit fleet for customers including Amazon, hit its natural limit. "You can produce a prototype system very quickly," Liu said. "But on the flip side, it is not a scalable model." Quality becomes unpredictable when every truck is different, service support falls short, and unit costs stay high. Factory-built ADS trucks, integrated with OEM production lines and dealer networks, solve all three problems simultaneously. International’s 951 dealerships were cited as an example of the service-network contrast between an OEM partner and a standalone retrofit startup. Driver costs represent up to 40% of total operating expenses, and Liu said converting a human-driven truck to autonomous can provide a fleet up to 4.5 times more profit per vehicle. PlusAI is operating commercially in Texas with International and targets 2027 for removing safety drivers entirely.

So What? The shift from "can it work?" to "can you build enough of them reliably?" is the most consequential pivot point in autonomous trucking right now. Four OEMs control 99.9% of U.S. Class 8 sales, and each has an aligned ADS developer. The partnerships are largely set. The next milestone to watch is when factory-production ADS trucks roll off the line in commercial volumes — not prototype batches — and what fleet adoption looks like in the first 12 months.

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ArcBest reports flat February tonnage, but PMI new orders point toward Q2 demand recovery

ArcBest reported essentially flat February metrics at its ABF Freight LTL unit — tonnage up 2% year over year but flat on a two-year stack, with a 2% decline in revenue per hundredweight offsetting volume gains. Quarter-to-date, first-quarter tonnage is tracking up 6% year over year. ArcBest reiterated Q1 asset-based margin guidance, implying a 97.7% adjusted operating ratio at the midpoint. The more forward-looking number is the manufacturing PMI: 52.4 in February, well into expansion territory for a second consecutive month, with the new orders subindex at 55.8. PMI inflections historically lead LTL volume improvement by a few months. Contract renewals averaged 5% in Q4 — the highest increase in six quarters. Meanwhile, ArcBest upgraded its asset-light segment outlook from a loss to up to $2 million in operating income for Q1, crediting AI-enabled automation for removing structural costs.

So What? The PMI data is the number that matters most here. New orders at 55.8 with manufacturing in sustained expansion after more than three years of contraction is the setup LTL carriers have been waiting for. If the trend holds through Q2, ArcBest’s tonnage trajectory should improve meaningfully, and contract renewals at a six-quarter high suggest carriers are already pricing in tighter conditions ahead.

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Sponsored Insight

From the Research Desk

What We’re Watching

▸ Whether a federal court stays the March 16 Final Rule. The AFL-CIO, American Federation of Teachers, and Public Citizen filed to halt the FMCSA’s non-domiciled CDL Final Rule, with FMCSA facing a March 9 response deadline. If no court issues a stay before Sunday, the non-domiciled CDL pathway closes for 97% of current holders and the trucking workforce math changes immediately. Watch for a ruling before the weekend.

▸ The UP-NS April STB refiling details. The STB sent the initial application back in December requesting forward-looking market data and deal terms UP declined to disclose. When the April filing lands, watch specifically what data is included versus redacted again — and how the STB responds to its own stated higher bar that a merger must enhance competition, not just preserve it.

▸ Manufacturing PMI follow-through in March. ArcBest’s February data confirms PMI new orders at 55.8, with the index in expansion for two consecutive months after more than three years of contraction. LTL tonnage improvements historically trail PMI inflection by a few months. If March PMI holds above 50, LTL carriers across the board should see demand improvement heading into Q2 — and contract pricing leverage shifting further in carriers’ favor.

That’s your Daily for today. See you tomorrow.

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