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The Disruptive Changes Making Ripples Throughout Trucking

Everyone in trucking is wondering when the next big trend in trucking will upset the natural order of things. What will be the next big thing? How many disparate forces must come together to create a real shift within the industry?

While the newest, most technologically advanced tractor always get a moment of fame, by themselves they don’t command the headlines. Everyone and their brother had been shouting about autonomous trucks for a long time now. Yet you don’t hear it as much anymore. Why? Certainly, it isn’t because the move towards autonomy isn’t happening. No, it is because no one sees them as a true viable option any time soon.

State and federal regulations – or lack thereof – cloud the picture. There are enough advancements happening with regular trucks-with-drivers, let alone computers on eighteen wheels.

Others point to the fancy Tesla and Nikola electric big rigs. While these certainly are impressive, shiny, new objects, there still isn’t enough information regarding range, durability, industry adoption, and so much more.

It would appear driving cool, new, battery-powered tractors might seem like an appealing proposition to someone looking for a new job in a secure industry, but they are a long way off. Conventional and hybrid powertrain options will continue to dominate for many more years.

Monumental shifts within an industry must happen organically. They must build from the bottom, growing slowly, then usually taking off with a boom once players from both inside and outside the industry take note and themselves adjust to the change. While autonomous and electric commercial motor vehicles have plenty of appeal, they don’t appear to be disrupters in the immediate or short-term.

Every topic has had its day, from platooning to greater natural gas adoption. But none of those seem like the real disruptor; the new thing that will shift the earth within the industry. What advanced technology or new initiative will ripple throughout the industry and leave change within its wake?

Trucking Makes Its Way Through DC

There is no doubt that the nation is seeing economic growth. With a business-friendly climate taking hold, what is going on in Washington D.C.? As the mid-term elections approach, trucking advocacy organizations and even trucking companies themselves want some assurances no matter who is in power, an open flow of the nation’s supply chain must be maintained.

A lot of regulations have disappeared in the past 18 months. Regardless of the rhyme or reason, this has had an impact on the industry. Even as the ELD mandate added an entirely new layer of complication, the speed-limiter test is gone, as is the sleep apnea language – and more.

The nature of change facing the trucking industry now is far more manageable. What lies beyond the horizon?

Many would argue infrastructure would be the true gamechanger. If meaningful repair and retrofit of the nation’s roads and bridges were to happen, once and for all, it could open the floodgates of commerce and lead to even greater economic growth. Will it happen, is the question.

What the administration has proposed, what Congress would be okay with, what the American people want, what trucking advocacy groups want – it’s all a mishmash of conflicting interests and desires.

With the Trump administration currently renegotiating NAFTA, the trucking industry wonders how they will fare once the deal shakes out. Cross-border trucking trade with Mexico and Canada continues to be at some of the highest levels it has ever been. This leads to positive economic activity on both sides.

Used Tractor Market Recovers

The used truck market showed strength after a sluggish 2017, a year in which prices lagged and sales slowed across the sector. Fortunately, most dealers report market stabilization. While prices have not crept up by a whole lot, used tractors continue to be an appealing option for owner-operators and large companies looking to plug some holes in their fleet.

The used truck market is affected by niche needs. Vocational truck requirements typically fluctuate, but with big, urban centers growing faster than ever, regional and residential-use vehicles of a variety of types show growth. This is a hot market and prices are up

Over-the-road used tractors have not seen the same kind of selling price growth. There has been very little price fluctuation mainly because the trucking employment shortage has put a crimp on growth. Vocational employment has not seen the same kind of shortage that OTR employment rolls have.

When combined, the growth in vocational numbers and the plateau in OTR orders is still growth. The market for used tractors shows resilience. With economic models showing continued growth, if the employment bottleneck breaks, the trucking industry will need all the new or used tractors it can get.

Nearly Half-Over

Would you choke on your beverage if we told you that 2018 was nearly half-over? Time flies, there is no doubt about that. It feels like just yesterday, right here at the Quick TSI blog team, we were just talking about the trucking trends that would shape 2018. And now here we are, well into the year.

With the middle mark already on the horizon, what should the trucking industry look out for as we finish the year and move into 2019, just like that. If 2018 is anything to go by, there is room for optimism. With the economy growing, there has been an expectation of growth in the supply chain.

Fed by the need for more and more truck drivers, OEMs have backlogs on tractor deliveries. Even with the United States economy staying at baseline, industry-wide growth is expected. Beyond new companies and new truck drivers coming on board, many current operators see the logic and the imperative of updating their own equipment.

With half the year burned through, dealerships are reporting that many of their large customers have already put in their late-2018, early-2019 orders. The trucking industry appears bullish on future economic prospects. With consumer confidence higher and consumer spending showing no signs of danger, motor carriers are looking to expand.

Too Much Business?

Is there ever a problem of too much business? Nearly every business owner’s natural instinct is to say, “Of course not!” Bring on the business and you bring on the profit. Yet trucking companies are having a problem finding truck drivers to fill the cabs.

When an industry does not have the number of qualified employees it needs to keep up with demand, you reach a situation where too much business becomes a problem. The silver lining out of all this? You hear very few fleets reporting business being bad or trucking companies failing in higher numbers than usual.

The truck driver shortage continues to be the single factor limiting growth within the industry. If there were enough people lining up to drive the routes required, it is possible you could see it reflected in overall GDP numbers.

Trucking Goes Virtual

Have you ever heard of the virtual head office? It is essentially a model where decision-makers across the organization are fanned out in different locations but can react as quickly and effectively to unexpected situations as they could have were they all together in a physical office setting.

Executives, directors, managers, and others of a company’s choosing, dons a headset and views a virtual window where they can see other participants within the virtual “room” and interact with each other. Some companies are testing out virtual white boards, where a user in one physical location can use a digital pen and a flat surface – such as a wall – can carry out a full-scale presentation.

Imagine being able to clearly map out your proposal to dozens of people spread out across the network. Large trucking companies have already begun to employ this technology. How long will it be before we see full adoption?

Traditional Hierarchies Offer Stability

Traditional management structures less reliant on technology and innovation still dominate industries. Having people in place who specifically focus on corporate recruiting, project management, marketing, fleet sales and services, shop services, and more, ensures the success of the organization. “Do we have the right people in place?” is never a bad question to ask yourself, from an operational perspective, of course.

When you have people within your organization who are specialists, excelling within their chosen field, magic happens. Not only are your people happy, but so is the community in which they work.

Trucking companies, shipping companies, freight brokerages, stores, markets, and so much more – all these businesses stand at the core of our nation’s economy. People eat, put gas in their car, go on road trips, buy clothing, and so much more, all on the backs of our nation’s transportation network.

Traditional business models focus on better customer service, more effective retention strategies, and the best ways to manage disruption in an industry primed for change. How will individual motor carriers and advocacy organizations handle this change? One thing is for certain, goods must continue to flow, as the American consumer desires, so everyone will adapt.

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