Important Trends in the Trucking Industry
Since the pandemic, the trucking industry has experienced significant changes in terms of the way companies operate and the types of trucks that travel to market spaces. Shortage of qualified drivers continues to plague the trucking industry, as the American Trucking Association estimates the scarcity to increase from 80,000 in 2021 to 160,000 by 2030. Meanwhile, the association forecasts the demand for freight tonnage to increase by 24 percent, bringing in 67 percent more in revenue for the industry. Despite the ongoing ups and downs faced by the industry, some trends stand out.
One trend that is likely to surface in the coming years is carrier bankruptcy. Between 2020 to 2021, several small and large trucking companies closed down their business due to harsh market conditions. This resulted in thousands of truckers becoming unemployed due to the closing down of trucking companies and over a million unemployed truckers overall. One of the reasons companies have shut down is the shortage of movement of goods which also resulted in reduced profitability. Unless there is a large spike in retail companies moving goods, the trend will likely continue in the coming year.
Since several trucking businesses have gone under due to market instability, several companies chose an alternative route and merged with other companies instead. Some companies merge with existing trucking companies to pool their resources and expand to newer territories. Others have merged with companies from different sectors to expand the range of services they provide. This strategy allows companies to continue their operations until the market recovers.
Technology has improved various aspects of the trucking industry. For instance, companies are starting to use software programs to streamline operations. Trucks are also being equipped with smart technology to improve their functionality. Trucking companies have set up technologies to track orders in real-time and communicate information to customers.
Some trucking companies have shifted their production operations to meet demands while keeping costs down. Currently, the pricing of trucking companies is very low, so much so that most truckers are earning less than the average wage in the United States. Since 2020, trucking companies have charged less due to the shortage of jobs and the fear of not getting work. If the market continues to decline, trucking companies may be forced to lower their prices even further.
The e-commerce industry has had a significant impact on the trucking industry in terms of influence. The e-commerce industry depends on trucking companies transporting goods from one place to another. Therefore, a continuous boom in e-commerce could significantly improve the trucking industry.
Rising fuel costs due to the limited nature of this resource have impacted the trucking industry significantly. Fuel has always been one of the biggest expenses that trucking companies incur. Fortunately, trucking companies have options to manage costs by using alternative fuel trucks and electric trucks, to manage costs. However, this also means investing large amounts of capital for new vehicles, which small trucking companies are incapable of doing at the current state of the market.
With the growth of urbanization, trucking companies can find it easier to travel through different areas they could not cross before. The wide-scale development in the United States has seen many rural areas being converted into urban landscapes. The trucking industry will likely benefit from this by widening its reach and offering services to a broader customer base.
