Changes In The Trucking Industry

The economy is starting to recover from years of dismal outcomes, and this means the demand for shipments of all types of products is up. The recent employment changes have also begin to register and this has set of a huge boom in the trucking world. This is a great thing for businesses as they saw the best holiday season in years, but it is also a challenge as trucking companies become overwhelmed by the demand.

It is a huge positive that local businesses saw an increase in sales for the end of 2017, but now they are pushing to re-fill their shelves without the trucks available to get their products from warehouses to retail stores. There is a nationwide shortage of trucks, and it may take up to two years to ramp up enough to meet the changing

Retailers are replenishing stocks after one of the strongest holiday sales seasons in recent years. Manufacturers are also shipping more cargo; in December, industrial production had the largest year-over-year gain since 2010, according to the Federal Reserve."

The truckers are hit hard as requests for more shipments come in because they are often not only delivering directly to the end retailers but also shipping between raw materials plants, manufacturing plants, and storage warehouses. The trucking industry often touches products at various stages of manufacturing and sales. A request for more products can mean they need multiple drivers in several states to support the larger group of products.

Beyond the strengthening economy, winter storms also played a role in the trucking shortage. January is traditionally a month with lower shipment volumes, but this slow-down did not happen this year. Poor weather conditions in December and January all but stopped shipments in many parts of the country. This combined with changing federal safety standards pushed back many shipments dates well into January. Most companies were not prepared for a rush in what was to be an extremely slow month

Many years ago retailers depended on schedule and predictable deliveries with one or two companies they are contracted with. This type of system allows both the customer and the shipping company to plan for the number of trucks and drivers they need at any given time.

With many retailers looking to compete with online sales that offer quick delivery, they have turned to "spot market" use of trucks. Instead of scheduling distribution for the same time of the week every week, they are now relying on short notice deliveries. This is an on-demand system and much harder for trucking companies to predict.

Spot markets for trucking also tend to use smaller trucks, with the most popular rig being the dry van. If deliveries are regularly scheduled using bigger vehicles, a driver may be able to group shipments in similar areas into one truck, but this is much harder to do with spot market requests. This leaves shipping companies using more vans which means more drivers as well.

It is not unusual for many trucking and delivery services to hire seasonal workers to meet the higher demands for December. Those jobs usually end before January because of the lack of work in that month. The winter storms and a profitable December left a gap between what the predicted volumes for January were and what they ended up