Febrruary 2025 Transportation Takeaways
The logistics landscape in 2025 is already showing signs of transformation, driven by shifts in manufacturing growth, evolving logistics metrics, regulatory updates, and trade policies. The latest reports indicate a resurgence in U.S. manufacturing, growing reliance on data-driven supply chain optimization, and notable developments in rail freight and intermodal transportation. Additionally, policy shifts, such as the ratification of a new ILA contract and the implementation of tariffs on Mexican and Canadian imports, are poised to shape global supply chains in the coming months.
With these changes in motion, logistics professionals and businesses must stay ahead of the curve, adapting to shifting economic conditions and industry trends. Below, we break down key insights that will impact freight, transportation, and supply chain operations in the near term.
1. Â Manufacturing Returns to Growth to Kick Off 2025
The U.S. manufacturing sector has entered 2025 with a strong rebound, marking its first expansion in over a year. According to the Institute for Supply Management (ISM) PMI report, January’s Purchasing Managers’ Index (PMI) registered above the 50% growth threshold, signaling an increase in economic activity within the manufacturing sector. This expansion is driven by stronger new orders, rising production levels, and improved employment numbers across key industries.
The report highlights that demand has been steadily recovering, with manufacturers reporting higher customer orders and improved supply chain conditions. After a prolonged period of contraction in 2024, companies are now ramping up production in response to growing market confidence. Notably, supply chain disruptions that previously hampered efficiency have started to ease, allowing for smoother operations and more predictable lead times.
Despite the positive momentum, challenges remain, including fluctuating raw material costs and global economic uncertainties. However, the ISM report suggests that if current trends hold, the sector will continue on a path of stable growth throughout the first half of the year.
Transportation Takeaways:
- Freight Demand Increase: As manufacturing activity expands, expect a rise in freight volumes, particularly in industrial and consumer goods.
- Stronger Truckload and Intermodal Activity: Improved production rates will drive demand for trucking and intermodal transportation solutions.
- Opportunities for Logistics Providers: Companies must remain agile to accommodate shifting supply chain needs and optimize efficiency amid fluctuating demand.
For further details, read the full ISM PMI report here.
2.​ New RXO Study Highlights Key Logistics KPIs
A newly released RXO KPI Research Study provides an in-depth analysis of the most critical performance indicators for logistics operations. The study emphasizes the increasing role of real-time visibility, predictive analytics, and on-time delivery metrics in improving supply chain efficiency.
According to the report, 83% of supply chain leaders consider real-time data tracking essential for enhancing decision-making processes. The study also highlights that customer satisfaction is the primary driver of logistics KPIs, pushing companies to refine their operations to meet higher service expectations. Additionally, automation and AI-driven analytics are being widely adopted to reduce inefficiencies, minimize costs, and improve overall logistics performance.
The findings reinforce the need for logistics providers to leverage technology in their operations. Companies that prioritize data-driven decision-making and proactive performance monitoring will be better positioned to optimize delivery times and cost efficiencies.
Transportation Takeaways:
- Increased Focus on Real-Time Data: Companies that integrate real-time tracking and analytics will gain a competitive edge in logistics efficiency.
- Customer Satisfaction as a Priority: Higher service expectations require logistics firms to improve delivery reliability and supply chain responsiveness.
- Growing Automation and AI Integration: The use of AI-driven analytics and automation will continue to streamline operations and enhance cost-effectiveness.
Explore the full research study from RXO here.
3. Rail Industry Sees Modest Gains as Intermodal Demand Rises
The Association of American Railroads (AAR) reports that rail freight volumes experienced slight growth in early 2025, supported by increasing consumer demand and intermodal expansion. Carload volumes have seen modest increases, with commodities such as coal, grain, and automotive products leading the way.
Intermodal traffic remains a strong performer, driven by the steady growth of e-commerce and consumer goods shipments. Analysts indicate that the continued investment in rail infrastructure and technology is positioning the industry for sustained efficiency and adaptability in the evolving supply chain landscape. While traditional rail sectors such as energy-related shipments continue to fluctuate, intermodal demand is expected to serve as a stabilizing factor in the market.
Despite these gains, challenges such as rail network congestion and regulatory pressures persist. The industry’s ability to adapt to shifting demand patterns and streamline operations will play a crucial role in long-term growth.
Transportation Takeaways:
- Modest Increases in Freight Volumes: A slight rise in carload shipments suggests a stabilizing rail freight market.
- Intermodal Continues to Grow: Consumer demand and e-commerce activity are fueling increased reliance on intermodal transportation.
- Infrastructure and Investment Remain Key: Railroads focusing on technology and efficiency improvements will be better positioned for future growth.
Read more from AAR’s rail industry review HERE.
4. ILA Ratifies New 6-Year Master Contract​
The International Longshoremen’s Association (ILA) has successfully ratified a new six-year master contract covering Atlantic and Gulf Coast ports, ensuring long-term labor stability for the maritime industry.
The contract, which received overwhelming support from ILA members, includes significant wage increases, enhanced benefits for dockworkers, and commitments to protect jobs amid increasing automation discussions. With global supply chains still facing uncertainty, this agreement provides a much-needed foundation for uninterrupted port operations and efficiency.
Beyond wage and benefit enhancements, the contract also addresses labor protections as automation becomes a larger factor in port operations. While automation can improve efficiency, the ILA has ensured that job security remains a priority, with strict guidelines on its implementation.
Transportation Takeaways:
- Port Operations Stability: The new agreement ensures uninterrupted port activity, reducing potential labor-related disruptions.
- Increased Costs for Shippers: Wage increases could lead to higher port fees, impacting transportation costs.
- Automation Regulations in Place: Ports will continue modernizing, but job security measures may slow automation adoption.
Read ILA’s press release about the contract HERE. To learn more about the negotiations and proceedings to this new contract read our article about the ILA strike that took place back in 2024 HERE
5.​ Mexico and Canada Tariffs Set to Take Effect in March
After a 30-day pause, tariffs on Mexican and Canadian goods are now set to take effect on March 4, 2025, as announced by President Donald Trump. The delay was initially intended to provide time for renegotiations, but no major concessions were made, leading the administration to move forward with the policy.
Trump has cited protecting American manufacturing jobs and reducing the flow of fentanyl into the U.S. as the primary reasons for the tariffs. He argues that the automotive and steel industries have been negatively impacted by foreign imports, and that new trade barriers will help level the playing field for domestic producers. Additionally, the administration has expressed frustration over what it sees as insufficient efforts by Mexico to curb fentanyl smuggling into the U.S., using the tariffs as leverage to push for stronger enforcement.
The decision has sparked mixed reactions, with supporters seeing it as a bold move to strengthen the U.S. economy and combat illegal drug trafficking, while critics warn that it could raise costs for businesses and consumers. Companies reliant on cross-border trade should prepare for potential supply chain disruptions and increased procurement expenses as the tariffs take effect.
Transportation Takeaways:
- Increased Costs for Importers: Tariffs will drive up costs for businesses sourcing materials and products from Mexico and Canada.
- Potential Supply Chain Delays: Companies may experience longer lead times as they navigate new customs and compliance measures.
- Shift in Sourcing Strategies: Some businesses may seek alternative suppliers or adjust their logistics networks to mitigate financial impacts.
To read a more comprehensive analysis of the tariffs that will be going forward read our breakdown HERE. You can also read about the more recent statements made by Trump here.
Conclusion​
As February comes to a close, the logistics industry finds itself at a crossroads between opportunity and uncertainty. Manufacturing expansion and intermodal growth present promising avenues for freight providers, while emerging regulations and tariff implementations introduce new challenges for businesses engaged in international trade.
Companies that embrace real-time data analytics, invest in supply chain resilience, and stay informed on policy changes will be best positioned to navigate the shifting landscape. Whether responding to manufacturing demand surges, adapting to new rail freight regulations, or preparing for potential tariff impacts, agility and strategic planning will be essential in 2025.
MTA Lines remains committed to keeping you informed on the latest industry shifts. Reach out to us today to explore how we can optimize your supply chain and transportation strategies in the months ahead.
