Trucking in the USA is big business. It’s a multi-billion dollar industry that impacts almost every other industry and business in our country. For a large part, as trucking goes so does America. When transportation costs rise, the products and materials transported are affected. When shortages of equipment, personnel, or fuel hit trucking—it hits home. Considering the far reaching ramifications it’s the responsibility of businesses to stay aware of trucking trends. And support pro-transportation initiatives that impact every industry connected, partnered, and reliant on a healthy and profitable trucking industry.
New Trailer orders will continue to grow. “Trailer shipments in the United States are forecast at 256,000 units this year, with steady growth through 2016, according to ACT Research.” — Trailer Body Builders. Beginning with the economic downturns of 2008-2010 and continuing due to tight margins, high fuels costs, driver turnover, and the cost of federal regulations there is an abundance of older tractors and trailers that are past replacement time. Back orders and shortages of trailers will make refurbished trailers more attractive (and expensive) and may impact the industry’s ability to meet tonnage needs.
Driver and Technician shortage. In our post The Importance of Retaining Truck Mechanics we shared, “Like driver shortages, mechanic and technician shortages can affect the transport of goods. But not having enough mechanics and technicians also impacts longevity of equipment and truck dealers’ ability to maintain warranted equipment.”
Driver pay. With a first quarter 2014 driver turnover rate of 92% – ATA (American Trucking Associations) Swift Trucks, the largest U.S. truckload carrier, decided to take action. According to JOC.com (Trucking Logistics) “On Aug. 4, the Phoenix-based trucking company gave long-haul drivers the biggest pay increase in the carrier’s history, though it didn’t specify how much.” Driver pay increases will spread and impact freight costs, especially long haul.
ELD (Electronic Logging Device) Adoption. Whether basic ELD’s are mandated and regulated by the federal government more trucking carriers will implement ELD’s in 2015. ELD’s will be used to improve fuel savings, safety, and routing—all of which save time and money.
Manufacturing will continue to grow. Continued growth in manufacturing could impact the trucking industries ability to meet demands, which would increase freight costs. The MAPI Foundation shared these bullet points.
- Manufacturing production is forecast to grow 3.4% in 2014, 4.0% in 2015, and 3.6% in 2016
- Growth drivers are energy infrastructure, the housing supply chain, transportation infrastructure, medical care expansion, widespread growth abroad, and less domestic policy uncertainty
- Manufacturing will continue to grow faster than the overall economy
Infrastructure improvements will be tackled by States. Combined with the Federal Government’s inability to pass legislation, and the general lack of knowledge as to the severity of our infrastructures decline more States will take on the task. For example, California’s 5 Year Infrastructure Plan 2014.
Fuel prices will drop and stabilize. The United States Energy Information Administration (EIA) predicts gas and diesel fuel prices will drop to somewhere between $2 and $3 per gallon then stabilize through the midpoint of 2015. Although fuel prices may adversely affect oil related industries, it will put billions of dollars in consumers’ pockets.
Acquisitions will continue. Trucking companies absorbing other carriers will not only be used to gain market share and growth, but as a method to acquire equipment and personnel. Aftermarket providers will have plenty of rebranding opportunities.
Tonnage will grow. ATA predicts trucking tonnage will continue to grow steadily through 2025. Higher tonnage will increase shipping costs as the industry’s ability to meet demands is strained.
Every industry, business, and organization in America should post this on the wall next to their workstation. One or more of these top ten trucking trends will affect everyone, from after-market providers gearing up to handle the influx of merger-related rebrands to retailers being prepared for higher shipping costs. What trends could help or hurt your industry?