The US trucking business and beyond has encountered numerous systemic and structural disruptions due to the COVID-19 pandemic.
Despite several challenges, the significant rise of the ecommerce industry has resulted in a substantial increase in the transportation of goods and services within regions, leading to an increased demand for professional and skilled truckers.
Much to your surprise, the market size, measured by revenue, of the local freight trucking industry in the US is $91.7bn in 2023. However, it is expected to decline -0.5% in 2023. That suggests the trucking business and beyond is likely to experience tons of disruptions in the coming few years.
In this blog post, we will discuss the possible trucking industry challenges and disruptions that can significantly change the direction of the trucking business and beyond in the years to come.
The trucking industry in the US is likely to experience a number of disruptions that are highlighted as follows:
Industry experts are already aware of the importance of effective supply chain management. Without it, the trucking industry cannot thrive. The supply chain and logistics sector has been facing disruptions for a long time now, and it doesn’t seem that the situation is going to change any time soon.
The US trucking industry is encountering difficulties due to frequent lockdowns in China and bottlenecks at the US west coast and Shanghai ports. Furthermore, the trucking industry has been grappling with internal issues such as driver shortages and slow delivery times, which have only aggravated the problems.
In fact, there is a large imbalance between supply and demand, partly due to the low number of trucks being produced. The shortage of semiconductor chips may be one reason for this slowdown, but other factors such as the state of the trucking industry, its financial losses, and the anticipation of a recovery by 2024 may also be contributing factors.
This has led to the use of outdated fleets, exacerbating the situation. Industry professionals are aware of these challenges, so it is likely that effective technological and operational solutions will be implemented to restore the balance between supply and demand.
The trucking industry and its associated companies have undergone significant changes due to various factors such as increasing oil prices, changing work patterns, the possibility of an upcoming economic downturn, and the growth of ecommerce.
When movement restrictions were brought into effect in 2020, several small businesses were forced to shut down, causing job losses and market instability. As the situation improves and the industry resumes normal operations, it's likely that more trucks will be deployed and truckers will return to work.
Nevertheless, it's important to acknowledge the evolving market conditions and the need to address inflation and unstable consumer preferences.
To be more environmentally friendly and cut down on fuel expenses, it's crucial to implement better route planning and delivery scheduling. A good place to start would be eliminating empty return trips.
This can be achieved through real-time data delivery to the backend office, which can be made possible by installing proper asset trackers on the fleet, but this requires careful and adequate planning.
Around the globe, various countries have made claims about sustainability, and organizations are expected to follow suit. Companies have pledged to lower their carbon footprint in the future and preparations are already underway.
The trucking industry is facing a significant shift towards renewable energy sources and electric vehicles, which will pose challenges for current truck owners and companies.
In terms of safety, many organizations will prioritize this aspect by incorporating technology such as sensors, cloud cameras, and trackers into their fleets. The trucking industry requires collaboration between truckers, fleet managers, and technology companies to create a greener and safer future.
To be prepared for the future, major trucking companies will partner with tech-focused businesses. There will be a rise in such partnerships in 2023 to improve the efficiency and safety of the trucking fleets.
Government regulations continue to play a major role in shaping the trucking industry. New regulations around emissions, safety, and labor practices are affecting the way trucking companies operate, and companies must stay up-to-date with these changes in order to remain competitive.
Some of the major regulations that are disrupting the industry in 2023 and beyond include the electronic logging devices (ELD) mandate, the Compliance, Safety, Accountability (CSA) program, greenhouse gas emission standards, Hours of Service (HOS) regulations, and drug and alcohol testing.
These regulations have disrupted the trucking industry by adding additional costs and limitations to trucking companies and truck drivers. However, these regulations are also aimed at improving safety and reducing the environmental impact of the trucking industry.
It's imperative for trucking companies to stay informed about these regulations and adapt accordingly in order to remain competitive in the industry.
Last-mile delivery refers to the last step of delivering a product to the customer's doorstep and has been disrupting the trucking industry in several ways in 2023 and beyond.
With the rise of e-commerce and online shopping, customers have become increasingly demanding when it comes to delivery times. As a result, trucking companies are under pressure to find ways to make last-mile delivery more efficient and cost-effective.
In an effort to improve last-mile delivery, trucking companies are increasingly using alternative delivery methods such as drones, robots, and electric vehicles. These methods offer the advantage of being able to navigate through narrow streets and traffic congestion, making last-mile delivery faster and more efficient.
Last-mile delivery has also given rise to new business models such as crowdsourced delivery and subscription-based delivery services. On the other hand, trucking companies are investing in technology to improve the efficiency and accuracy of last-mile delivery. This includes the use of GPS tracking, real-time monitoring, and predictive analytics to optimize delivery routes and reduce delivery times.
In 2023, the trucking industry will experience significant changes as companies seek more eco-friendly and technologically advanced options. Companies can stay ahead of the curve by implementing effective strategic planning and portfolio management.
At LoadStop, we provide an effective transportation management system that keeps you ahead of the game. Book a demo with us to discover the incredible trucking management features we offer, especially designed to streamline complex trucking operations, improve business processes, and increase the bottom line for your business.
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