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Shippers Face Bumpy Ride in Trucking

01.27.14 | Noël Perry and Larry Gross

2013 was a turbulent year for trucking, and we expect 2014 to be more of the same. Pressure is building, and although a crisis isn’t inevitable, one could occur if a combination of events breaks the wrong way. Here is our take on the major themes that will be in place next year:

Modest Growth Meets Static Capacity

Demand for trucking services has been growing at a tepid pace, and this trend is expected to continue through 2014 with expected growth pegged in the mid-2-percent range. Carriers, meanwhile, haven’t been adding capacity, opting instead to buy only sufficient new equipment to refresh their fleets and to keep average age in check. This has resulted in historically high fleet utilization.

The fleets have been refining their operations relentlessly and continue to do more with less. But rate pressure is beginning to build. Although the year-over-year figures don’t reflect it, FTR's data indicates rates, in fact, did begin to move up smartly in the second half of 2013, a trend we expect to continue through this year.

Read the full article at JOC.com >