Following the new agreement between the International Longshoremen’s Association (ILA) and United States Maritime Alliance (USMX), the labor union is expected to ratify the contract that will define shipping operations in the East and Gulf Coast states for the next six years.
Despite Trump’s threats to increase tariffs for Mexican products, the nearshoring partnership between the most powerful economy and its largest trading partner will only grow stronger — this, according to experts and officials on the ground.
Continue reading to learn more about what is happening in the freight world this January.
After a hard-fought negotiation that kept shippers nationwide on their toes, the ILA and the USMX finally reached an agreement that both parties seemed happy with. The ILA is now moving toward ratifying the new contract with port employers on the East and Gulf coasts. Union leaders will meet with wage scale delegates soon to review the tentative agreement with terminal operators and ocean carriers.
If delegates approve the deal, union members will vote to ratify the six-year master contract covering pay and benefits for 25,000 dockworkers from Texas to Boston. The agreement includes a 62% pay raise over the contract’s life, and employers are allowed to introduce semiautomated cranes and robotic equipment in exchange for job guarantees.
Despite President Trump’s plan to impose 25% tariffs on imports from Mexico, experts believe this will not hinder the growing trade and investment between the two countries. A TA Services leaderl said, “Even with the tariff taking effect, Mexico will still represent a very attractive option.” This sentiment is shared among several manufacturers, thanks to Mexico’s affordable workforce and proximity to the U.S. borders.
While Mexico’s minimum wage was increased several times in 2024, the peso suffered its worst devaluation in 16 years, depreciating 23% in the same period. The peso could continue to slide, counterbalancing the minimum wage increases. This scenario has meant that manufacturers would be hard-pressed to relocate their facilities out of Mexico, as the country would remain attractive as a manufacturing destination despite the threat of tariffs.
Additionally, the country’s economy is stable and has many trade agreements. In 2024, U.S.-Mexico trade saw a 6% year-over-year increase, totaling $776.05 billion. Industry leaders anticipate continued growth, particularly in aerospace manufacturing and logistics. Even with the tariffs, businesses are expected to adapt by optimizing supply chains, leveraging Mexico’s trade agreements and strategic geographic advantages to maintain competitiveness.
California has withdrawn its request for a federal waiver to enforce a mandate for zero-emissions big rigs, citing concerns over potential rejection by the newly formed Trump administration. Trucking leaders believe that the state’s decision to drop the mandate for zero-emissions big rigs is the start of a broader rollback of emissions regulations under the
Trump administration. Officials from the trucking industry say they support a move toward cleaner fuel but only under workable conditions.
According to industry experts, California’s proposed regulations were not feasible, mainly because the technology and infrastructure for zero-emissions heavy-duty trucks are not fully developed yet. California’s strict mandate aimed to require truckers to purchase battery-electric and hydrogen fuel-cell trucks. Trucking industry leaders argue that these trucks are not ready for widespread use due to high costs, limited range, and insufficient infrastructure. Despite this setback, California will continue implementing local emissions regulations. Truckers hope the Trump administration will introduce more realistic standards for emissions reduction.
The U.S. less-than-truckload (LTL) market is experiencing a slowdown in demand while pricing remains high. LTL rates have plateaued, showing no significant increase for the fourth consecutive month. Despite a 1.6% drop from July 2023, LTL pricing remains elevated, having gone up 5.5% since Yellow’s collapse in 2023.
Shippers now have more leverage in contract negotiations as the market struggles with weak freight demand. LTL carriers can still secure modest rate hikes due to market consolidation and a better understanding of costs. Shippers have seen savings in fuel surcharges, although the overall pricing situation remains elevated.
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