By Cain Adams
Trinity Logistics/Longboard Logistics
Driver shortage is the talk of the industry. “What industry?” you say.
Every industry! How do we solve it? Well, I guess we can all just stop shopping.
But, stopping shopping opens another can of worms, doesn’t it? We could recruit more drivers. But what do we tell a prospective candidate? “Sign here if you want to drive 600 miles a day, work 14 hours each day, be away from home, increase your chances of divorce and not be there for your kids other than through Facetime.”
We are seeing more VC money coming into the supply chain. Maybe more money invested in technology will help? Wait, how much does an automated truck cost? And how far away are we from seeing them take over the open road? Who will insure them, and if so, how much will it cost? Everything gets passed down.
FedEx is dropping accounts that don’t pay great to free up space for those who do pay better. Fourteen hundred accounts, I believe. FedEx is also trying to recruit, paying a ton of overtime, and doing their best to keep the stock investors happy. FedEx made more this past quarter than expected, but their costs are higher too. This seems to be across the board for LTL and larger carriers.
I think we will see more conglomeration this year among the larger carriers. No breaks in 2021, it seems. Companies are trying to make up for their losses in 2020, and yet it is turning into a storm of higher costs rather than increased profit margins.
This fall will look similar to last fall. We think July will see a bit of a drop over June. We won’t have any holidays until Labor Day, and that usually helps slow demand a bit. Once the fall rolls in, we hope less spending happens and brings us back to pre-COVID shipping levels.
If so, then we could see some stabilization.
I think long-term contracts will be bid higher to pad costs. People just do not know what is coming. Scary right?
I really do wish there was a way to bring 10-20 larger trucking companies together across the country; I wish I had the money to create lanes for these trucking companies and use the old Pony Express system.
I have a business plan for it, but can you imagine what it may do to the entire industry? Imagine drivers making $750 to $1000 per day for driving 300 miles one way and 300 miles back? Imagine them staying home each night or every other night? Imagine creating a system that works using electric trucks instead of diesel-based on these numbers.
Last-mile drivers are standing by to make local drops-and-picks and dropping at strategic yards based outside large metro areas. Cross-docking fast and keeping freight rolling.
And pensions. Yep. I bet someone out there has the money to put this together.
Daily, I feel for some of these guys. They work their butts off. I also feel for the farmers. Farmers work hard and take a lot of risk with the weather, labor costs, market price, and transportation costs on top of that. How are they to make it?
The only way we see it all happening is to raise the prices to the consumers. But this still does not fix the long-term. This only pushes rates up, allowing companies to stay in business and pay a truck who is available or reduce the earnings to a farmer. Those who pay the most will stay in business. That’s the honest truth. We need a long-range solution.
What about lowering the age to drive? What about companies offering pensions?
Is it a national emergency if there are not enough truck drivers? Can the government help in any way like increasing the number of rest areas close to metro areas? We do not have enough parking near the big cities, you see. Taking the pain points of a truck driver and fixing them may increase the chances of new recruits.
I am not a guy who asks the government for anything. I believe in small government, but in this case, I do think we could create some incentives for future drivers. People just do not want to get in that cab, and something needs to be done to bring these iron horses back to looking sexy, fun and giving a person a better way of living.
In my view, we all need to step up our game. If a driver walks into your building and may look torn up from the floor up, there may be a reason. He or she may be driving hard for five or six days to get to your location and “on time.” We can treat them all with respect. Even the ones who don’t speak much English. They are doing the work needing to get done.
Shippers can load faster. Receivers can unload faster. Brokers can help drivers if there are problems or breakdowns. And above all, just say thanks and give them a reason to get back in that truck.
Did I stand on my soapbox too long? Probably. But it’s only because I care about what is going on, and I hope you do too. Make things happen. Help with change. Be the change.