“I urge everyone to begin making contingency plans for the day you cannot get a truck.”
Other details in Annual State of Logistics Report 2012
· Logistics costs in 2011 increased 6.6% to $1.28 trillion over 2011 levels.
· Logistics accounted for 8.5% of the U.S. gross domestic product, which was $79 billion more than what was spent in 2010. Before the recession took hold, U.S. businesses spent $1.39 trillion on logistics in 2007.
· Despite tighter capacity and an overall decline in volume, trucking rates were up 5% to 15% in 2011. Rates have been flat for years and the industry has not been able to recover operating costs.
· Domestic air cargo revenue dropped 3% in 2011 compared with a less than a 1% decline in international revenue.
· Ocean carriers continued to battle excess capacity, rate erosion, service declines and operational losses.
· Retailers are fine-tuning how they manage their inventory. In some cases, they’re pushing inventory back on their wholesalers or the manufacturers.
Source: Council of Supply Chain Management Professionals
Published June 20, 2012
WASHINGTON, D.C. — A growing shortage of drivers might mean transportation managers will have to scramble and find a truck to haul their goods.
Capacity in the trucking industry is shrinking because of increased regulations, including new hours-of-service rules that are expected to take effect in July 2013, said Wilson, senior business analyst of Canada-based Delcan Corp.
The regulations, which will limit how many hours a driver can work, could lead to a 3% to 8% decline in driver productivity, Wilson said. In addition, trucking companies are finding it difficult to recruit and hire drivers despite the nation’s high unemployment rate.
“By the end of 2011 about 18% of carriers surveyed by TCP (Transport Capital Partners) reported 6 to 10% unseated trucks,” Wilson said during a presentation at the National Press Club.
It’s unlikely that the situation will improve anytime soon, she said.
“I urge everyone to begin making contingency plans for the day you cannot get a truck,” Wilson said. “The railroads are standing by with a great offer and have the capacity to take up the slack.”
A Union Pacific executive told Wilson that if truckload capacity drops by 5%, intermodal traffic probably would climb about 30%.
Some trucking companies are teaming up with the railroads to prevent any disruption that might be caused by the driver shortage, Wilson said.
According to the report, both trucking and rail saw business increase in 2011. Trucking, which makes up 77% of the transportation component of the U.S. logistics network, reported a 6.2% increase in volume in 2011, while rail volume increased 15.3%.
Intermodal volume rose 5.4% to 11.9 million containers and trailers in 2011, the report said.
“It is becoming a more preferred method of moving goods,” Wilson said of intermodal.