By: Jack Porter, TPP Managing Director and “The Trucking Activist”
We are bearing witness to today’s trucker as the backbone of our nation’s supply chain, staying the course during this turbulent time and supplying our essential needs through product deliveries every day. While the public has a newfound appreciation of truck drivers and those that support them inside the business, there are pockets of concern in the trucking industry. While many are thanking drivers at #KnightsoftheRoad and #ThankaTrucker for their dedication to their job, and their willingness to perform their duties as an essential worker, there are other mounting problems.
While all businesses are dealing with this new normal, so is trucking. Certainly, the public still sees trucks running and getting paid, the lion share of the truckers have also lost their demand and must resort to picking up loads on the spot market. The spot market, a pure Supply and Demand transactional arena has become an environment that can only be referred to as challenging at best. I get the market, and I get we are in uncertain times, but I also see the light at the end of the tunnel.
While the short-term ability to find cheap hauling capacity may be a lifeline to some of the struggling shippers, please keep in mind that the long-term effect will be the elimination of truck capacity when the recovery starts. Small trucking companies that have lost their main mode of shipment are now trying to survive on the spot market, and at rates that are dramatically less than what many can survive on. I won’t use this platform to judge the merits of what is right and what is wrong, I do insist that we recognize that, much like the pandemic, we are all in this together.
I think we can all agree that the long-term effect of this environment will be reduced capacity of trucks, and small truckers especially. As these essential workers, many of them independent contractors, haul freight that is desperately needed, may not survive. As we lose these great small truckers, the rest of the truckers are not buying trucks or trailers, thus the normal replacement pace of equipment has slowed to a snail’s pace. Demand will return, and rates will skyrocket and capacity will fall in line to a level that is beneficial to this industry.
For those of you resting on the “market reason” for freight rates abysmally lower than what we are used to, maybe consider a longer term approach where you actually help a small carrier by giving them a negotiated rate that keeps everyone in the ballgame, a rate that the shipper can accept, the driver or carrier can stem the tide of an uncertain immediate future and together we can get through this as a united whole.
Thank you to all the Trucking Community for everything you do! #KnightsoftheRoad.