News and Media

U.S. Trucking Challenges (Update)

2015-04-02

Crowley would like to provide you with this update regarding the significant challenges facing the industry as it relates to truck power in the U.S. and the cost impact associated with those shortages. As previously communicated, truck power shortages remain constant and continue to have a dramatic impact on the shipping lines ability to meet market demand, which continue to exceed current truck capacity.

Those factors that continue to put a strain on truck resources availability and costs include:

  • Driver Shortages-The American Trucking Associations estimate carriers are currently short more than 35,000 drivers and that number is likely to rise in the near future. The ATA warns that the shortage could hit 100,000 as the U.S. economy expands. In addition, as reported by the Journal of Commerce, truck driver wages in 2015 and beyond, could push pricing up by double digits. Those increases are estimated at 12 to 18 percent. Industry analysts warn that those increases are necessary to attract qualified driver candidates as the U.S. economy strengthens and the unemployment rate drops.

  • Increased demand for inland services as the U.S. economy and production increase. Industry analysts also predict a shift in demand from West Coast ports as retailers and manufacturers shift volume to the East Coast due to chronic port congestion.

  • Increased Government safety and environmental regulations that will make hiring new, qualified drivers more difficulty and more expensive due to enhanced compensation programs that will attract and retain quality drivers. Those regulations will also drive rates higher due to lost productivity, increased maintenance costs, and technology advancements that will be necessary to meet those new regulations.

Crowley is committed to partnering with our core carriers to mitigate cost increases and maintain service levels that have been impacted due to the shortages. As we face these challenges together, we ask for your understanding if the aforementioned challenges necessitate adjustments to the inland rate factor, as well as your continued cooperation in providing as much lead time as possible when requesting Intermodal services. We will continue to monitor inland costs utilizing the CASS index and adjust inland rates accordingly.