More truckers are saying they’re running out of capacity

Should we be concerned? Truckers seem to be running out of room.

That seems to be the takeaway from this year’s State of the North American Supply Chain study from transportation company Averitt Express. The report, which polled 1,600 shippers in late 2017, found that diminishing truck capacity is the industry’s “primary hurdle” this coming year. Last year about 20 percent of truckers faced capacity issues, a rate that doubled from 2016.

“Capacity is definitely the big ticket item now,” Brad Brown, Averitt’s marketing and communications manager, said in this report from the trade journal Fleet Owner. (Continued below.)

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These are the problems of a growing economy. About 76 percent of freight operators expect their volumes to continue to increase in 2018 but are struggling to meet these demand, particularly because of new electronic logging mandates and a continuing shortage of drivers.

The industry is coping by using alternative methods of transport like air and rail, a trend that will likely continue its upswing from last year. Shippers are “more receptive to our solutions,” said Patrick Ottensmeyer, president and chief executive of the Kansas City Southern rail line told Fleet Owner. “So we feel very comfortable that we’re going to have a good year and that we have a great product out there in the marketplace.”

What about driver shortages that continue to plague the industry? No one seems to have a great answer for that. Trucking companies are doing what they can to provide competitive wages and, more importantly, a better quality of life to attract new drivers. Oddly, I found no reference in the report about the growing investments by large trucking manufacturers in autonomous transportation vehicles as a way to increase capacity and reduce driver hours - a trend that will bear watching in the future. (Continued below.)

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For most businesses that ship products, all of this seems to be pointing towards potentially higher freight costs in 2018. However, there could, according to one analyst, be a potential silver lining: taxes. “Between the rates increases and the new tax relief, we believe that those will more than offset the rising costs in the near term at least,” Avery Vise, vice president of trucking research at FTR Transportation Intelligence said in another Fleet Owner report.