The impact of ecommerce has altered the trucking industry. The trucking and freight industry is experiencing a significant shift in its operations due to the rapid expansion of e-commerce. In recent decades, the rise of online shopping has revolutionized consumer spending patterns, leading to a fundamental change in the way society functions.
The impact of ecommerce has caused the trucking industry to undergo a significant transformation. In fact, new trucking trends have emerged, revolutionizing the entire trucking industry.
According to the American Trucking Association's U.S. Freight Transportation Forecast, freight tonnage in the United States grew by 24% by the end of 2022, leading to a projected 66% increase in revenue.
To meet the rising demand, the number of truck drivers on the road has steadily risen. The U.S. Bureau of Labor Statistics reports an annual average of 231,100 openings for heavy and tractor-trailer drivers, with a projected 6% growth in the field from 2020 to 2030, comparable to the average for other occupations.
The American Transportation Research Institute has recently released a report that examines the impact of e-commerce on the trucking industry. Some notable findings from their research include:
In 2017, e-commerce accounted for $449.9 billion, or 9% of total retail sales in the U.S., which amounted to over $5 trillion.
A survey conducted by UPS found that 63% of respondents considered delivery speed as a critical factor when searching for and selecting products.
Non-store retailers, such as Amazon and eBay, generate 85% of e-commerce sales.
While consumer products like electronics and apparel have dominated digital spending, businesses have increasingly shifted their purchases of industrial and construction supplies to online platforms.
As with any rapidly growing industry, there may be some complications as truckers, warehouses, and supply chain managers all work to keep up with demand. The following are some trends that can be expected in the industry:
Technological Advancements: Most major mobile carriers are phasing out the use of 3G for electronic logging devices (ELDs), which record driving time for commercial motor vehicles, in favor of 5G to improve system efficiency and ensure drivers comply with their allowed hours.
Infrastructure Strain: With an increase in heavy vehicles on the road, more wear and tear is expected, leading to road problems such as potholes and closures that can result in traffic accidents and congestion.
Shifts in Production Locations: To operate more efficiently, many businesses are relocating their production operations to central areas to meet demands. For instance, Texas and Pennsylvania are the primary producers of flatbed vehicles, while dry vans are mostly manufactured in Texas, Illinois, and Ohio.
E-commerce has had both positive and negative impacts on the trucking industry. While there are various modes of transportation for freight, the trucking industry is the primary means of transporting goods.
The rise of e-commerce has led to a reconfiguration of the trucking industry, including changes in packaging, shipping, and delivery methods.
To meet the demand for speedy delivery, e-commerce companies like Amazon are implementing innovative strategies to deliver products to customers as quickly as possible, such as constructing warehouses and fulfillment centers in urban areas.
The increase in retailers who offer fast shipping options has significantly impacted the trucking industry. Issues such as driver shortages and retention rates, driver health and wellness, and hours-of-service regulations are directly influenced by the growth of e-commerce. Let’s understand how the impact of ecommerce has changed the trucking industry.
The expectation of faster shipping times is placing pressure on the trucking industry, which plays a vital role in connecting retailers with customers. Consumers now demand products that are readily available for purchase, with fast and often free shipping. This pressure has affected e-commerce truckers in particular.
E-commerce has transformed the job description for truck drivers. With more retailers offering fast delivery through fulfillment centers and consumers expecting it, intra-regional and last-mile truck trips have become more frequent.
As a result, e-commerce truckers must adapt to meet these demands. Rather than operating over the road (OTR) across longer distances, truck drivers now tend to work in smaller regions, allowing for more home time.
Shorter pickup-and-delivery jobs are now replacing longer inter-regional or national haul jobs. A report by the American Transportation Research Institute (ATRI) shows that the average trip length for truckers has decreased by 37 percent since 2000.
The truck driver shortage and retention of drivers are major challenges faced by the trucking industry. The increasing demand for short-haul truck drivers due to the growth of e-commerce exacerbates the problem.
According to the US Department of Transportation, annual freight volume in the US is expected to increase by 45% to 29 billion tons by 2040, with most of that volume being transported by trucks, requiring over 51,000 additional drivers to meet that demand.
E-commerce growth has brought both opportunities and challenges for the trucking industry. In the US, drivers must be at least 21 years old to complete cross-state trips, but the high number of local e-commerce deliveries creates more job opportunities for younger drivers.
Short-haul drives offer new opportunities to attract younger drivers and lower driver turnover rates since drivers prefer a more stable work schedule. However, on the flip side, e-commerce growth could exacerbate the shortage of long-haul drivers.
The regulations that govern the maximum amount of time a truck driver can work before taking mandatory time off are known as Hours of Service (HOS) regulations. These regulations cover drive time, on-duty time, and break times. The growth of e-commerce has impacted the trucking industry in terms of HOS regulations.
Truck drivers have expressed concerns about the federal HOS regulations, particularly long-haul drivers who have to contend with more frequent trips and tighter delivery schedules. However, e-commerce truck drivers who are involved in short-haul trips are exempt from some of these regulations.
As e-commerce continues to grow, more truck drivers are transitioning to locally operating positions, which offers them more flexibility in terms of HOS regulations. Under HOS regulations, drivers are not required to log their hours if they drive within a 100-air-mile radius of their normal work location, return to that location, and are released within 12 consecutive hours while following all other HOS regulations.
Although e-commerce retailers are pushing for faster delivery times, the growth of e-commerce has had positive impacts on the trucking industry. Local hauling provides more job opportunities for younger drivers and increases driver retention since short-haul trips are more desirable. Additionally, these short-haul trips allow truck drivers to operate under more flexible HOS regulations.
Overall, the impact of ecommerce has reshaped the trucking industry in many ways, and it will continue to do so as online shopping becomes even more prevalent in the future. By using advanced technological tools such as cloud-based transportation management systems, trucking companies are ready to meet the growing demands of the e-commerce industry.
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