The trucking and freight industry appears to do better than the entire economy of the United States. The reason behind this is their ability to adjust with changes in the supply chain caused by the coronavirus pandemic. Business was really good for flatbed trucking in July and the spot market is also doing well.
According to the results of DAT Solutions latest survey, the trucking and freight industry is holding its own during the pandemic-induced recession. The national average rates for vans, flatbed trucks and refrigerated trucks for August are at the high marks for 2020. Disruptions in the supply chain caused by the coronavirus resulted to more freight in the spot market. Previously, demand for truckload capacity declines during this time.
The DAT survey also revealed that fleets were able to shift the types of loads they carry based on the demand of consumers. Load volumes out of the top 10 fulfilment warehouse markets rose by 25% in July. There was a surge of imported home improvement materials and stay-at-home goods throughout the supply chain. The surge was particularly noticeable at the Midwest distribution hubs including Joliet, Illinois and Indianapolis. Spot van prices increased by 10% to an average $3.11 per mile in dedicated routes like Memphis to Atlanta.
A change happened at spot market dynamics last week because of the hurricane season. After hurricane Isaias, more loads moved out of Florida which was unusual. Van volume out of Lakeland increased by 20% if compared to the week before the hurricane.
At the beginning of the pandemic, the freight market sustained traumatic decrease in volume because of less consumer demand. Unemployment rates were high and Congress failed to deliver a bipartisan solution that can stimulate demand. While there will be long term improvement for the economy to return to pre-Covid19 level of activity, the trucking economy is moving to the right direction.
For many types of equipment and materials, flatbed trucking is the right shipment option. You can choose from a variety of flatbed options according to your specifications. Traditional flatbed or expanded flatbed can be used to transport building materials, heavy construction equipment and manufacturing components.
If you will ask any of the Canadian trucking companies on the challenges they are facing today, they will tell you that it is driver shortage. Job vacancy rates in trucking and logistics sector are quite high because older drivers have retired. Disruptions to the supply chain could exacerbate because of the shortage of truck drivers, recent rail blockages and the COVID-19 outbreak.
According to the research by Trucking HR Canada and Conference Board of Canada, there are approximately 300,000 truck drivers in Canada that move an estimated $850 billion of goods every year. This includes $550 billion in imports and $300 billion in exports. For comparison, Canadian National Railways only transports about $250 billion worth of goods annually.
Shortage of drivers is particularly pronounced in long-haul drivers where job vacancy rate is 9.4%. Industry rate is about 6.8% while national average is 3.3%. Trucking companies stepped up to ensure that goods are moving when trains weren’t available because of the rail blockages in February. More truck drivers are required in case of future disruptions caused by either protests or corona virus.
According to Angela Splinter, chief executive of Trucking HR Canada, the fluidity of the supply chain is already negatively affected by driver shortages and disruptions and uncertainties in the market are not helping.
The trucking industry lost $3.1 billion in revenues in 2018 due to driver shortages. Trucking companies have to turn down work and delay plans for expansion. Aside from drivers, 350,000 people employed by trucking logistics in shipping, receiving, courier services, warehouse and distribution centers are affected.
Younger people are not lining up to become employed as truck drivers even if the average annual salary is $67,500. There are some perceptions on the industry and work life balance challenges for jobs that require being away from home. 3.5% of truck drivers are women but they have expressed concerns about safety at rest stops.
You can choose from any of the Canadian trucking companies to expedite transport of goods throughout all of Canada and the United States. State-of-the-art and specially-engineered equipment ensures unprecedented shipping speeds for large and small shipments, over-sized loads, temperature-controlled goods and fragile items.