Title: Economic Jitters Take Center Stage as Top Concern for Trucking Industry in 2024
Article:
Rebecca Brewster, President, and COO of the American Transportation Research Institute (ATRI), has revealed that economic concerns are dominating the trucking industry’s apprehensions as it strides into 2024. ATRI’s extensive survey of over 4,000 transportation stakeholders indicates that truck parking, fuel prices, driver shortage, and driver pay closely follow as the top five issues.
Notably, zero-emission vehicles entered the fray at the tenth spot in the 19th annual Top Industry Issues report. This comprehensive report also highlighted lawsuit abuse reform, driver distraction, driver retention, and detention/delay at customer facilities as pressing concerns for U.S. motor carriers and drivers.
The economy’s emergence as the foremost concern echoes sentiments from the Great Recession in 2008 when it initially secured the second position before clinching the top spot for three consecutive years. Brewster observed parallels between the current economic landscape and that tumultuous period, citing high inflation, decreased freight demand, rising operational costs, and fuel prices ranking third among the industry’s worries.
The ATRI’s 2023 Operation Costs of Trucking report reflects the challenges faced by the industry. Trucking total marginal costs soared to a new high of $2.251 per mile, with fuel prices playing a pivotal role in this increase (53.7% higher than in 2021). Other expenses, including driver wages, rose by 15.5% to 72.4 cents per mile.
Brewster emphasized that this is the first time operational costs have breached the $2 per mile threshold, and she foresees this trend persisting in the foreseeable future.
The economic landscape has a cascading effect on the industry, impacting freight demand, driver compensation, and overall operational costs. Dean Key, a driver for Ruan Transportation Management Systems, noted the challenging dynamic where economic slowdowns lead to reduced freight, affecting paychecks, while prices continue to surge.
Top 10 Trucking Industry Concerns of 2023:
- Economy (No. 5 in 2022): High inflation, reduced freight demand, rising interest rates, and escalating operational costs make the economy the primary concern.
- Truck Parking (No. 3 in 2022): Insufficient truck parking, a long-standing issue since 1992, has reached its highest ranking as the second overall concern.
- Fuel Prices (No. 1 in 2022): Despite dropping to the third spot, fuel prices remain a critical worry, constituting 28% of total operating costs.
- Driver Shortage (No. 2 in 2022): Estimates indicate a reduced need for drivers, around 64,000, as freight demand softens, impacting driver hiring.
- Driver Compensation (No. 4 in 2022): Falling one spot, driver compensation remains a key concern, reflecting a 15.5% increase in wages.
- Lawsuit Abuse Reform (No. 10 in 2022): Climbing the ranks, lawsuit abuse reform, or tort reform, holds a pivotal position, linked to insurance cost and availability.
- Driver Distraction: Returning to the top 10 list, driver distraction emerges as a crucial issue, with safety implications highlighted by the National Highway Traffic Safety Administration.
- Driver Retention (No. 7 in 2022): Experiencing a drop in rank, driver retention is influenced by the softer freight market and stands at eighth overall.
- Detention/Delay at Customer Facilities (No. 6 in 2022): Falling to ninth place, this issue is temporarily mitigated by softened freight demand but remains a persistent challenge.
- Zero-Emission Vehicles: Debuting in the top 10, the transition to zero-emission vehicles poses challenges due to high costs and insufficient charging infrastructure.
ATRI’s comprehensive analysis not only identifies the industry’s concerns but also provides data-driven strategies to navigate these challenges. The report’s respondents encompassed motor carrier executives, truck drivers, and law enforcement personnel, collectively offering a holistic perspective on the industry’s current landscape.
The complete report can be found at ATRI’s website.