The US Trucking Shortage: Causes, Impacts, and Solutions

Introduction

The United States is currently grappling with a significant trucking shortage problem that threatens to disrupt the entire ocean freight services logistics chain. While autonomous trucking technology continues to advance, its full implementation remains a distant reality. In this article, we'll explore the current trucking situation, its causes, and potential solutions to address this critical issue.

Key facts about the US trucking shortage:

• The shortage of truck drivers has been a long-standing issue in the US
• Recent developments have exacerbated the problem, leading to a crisis in the logistics industry
• The shortage is affecting various aspects of the supply chain, from port operations to final delivery
• Industry players are seeking innovative solutions to mitigate the impact of the shortage

Understanding the Roots of the Trucking Shortage

The trucking shortage in the United States is not a new phenomenon. For decades, the industry has struggled with attracting new qualified drivers while existing drivers have shifted to distribution jobs. Several factors contribute to this ongoing issue:

1. Financial Considerations

Many drivers are opting for jobs that offer better work-life balance, such as driving delivery trucks for grocery chains. These positions often allow drivers to return home every night, as opposed to spending long periods on the road. The perceived lack of compensation for personal sacrifices has led many to reconsider their careers in long-haul trucking.

2. Retirement and Equipment Costs

Some older drivers and operators have chosen to sell their trucks and retire, particularly when faced with expensive repairs or equipment breakdowns. The high costs associated with maintaining and upgrading trucks have led some to conclude that the business is no longer financially viable.

Recent Triggers Intensifying the Crisis

While the trucking shortage has been a persistent issue, recent events have exacerbated the problem, leading to the current crisis. Two major factors have significantly impacted the industry:

1. Electronic Logging Device (ELD) Implementation

The implementation of the Electronic Logging Device (ELD) mandate in early December has been a significant contributor to the current bottleneck. This industry-wide change requires all truck drivers to install a device that automatically logs driving time, engine hours, vehicle movement, miles driven, and location information. The mandate has had several consequences:

• Restricted ability for drivers to make money
• Increased impact of congestion and long wait times at ports and rail yards
• Reduced flexibility in managing driving hours

As Klaus Lysdal, Vice President of Sales & Operations at iContainers, explains: "Drivers want to be on the road. They want to drive and make money on the mileage they cover. Sitting in line at the port does not pay the bills and with ELD regulations, it now means that time spent waiting in line eats away at their driving time."

2. Unexpected Severe Winter Weather

The winter season traditionally puts pressure on the trucking market, particularly in northern states. However, this year, unexpected severe winter weather in southern states has caught many unprepared. The consequences have been far-reaching:

• State traffic departments in the South were ill-equipped to handle snow
• Roads not built to withstand cold temperatures suffered significant damage
• Increased truck breakdowns and flat tires due to road conditions
• Disruptions in areas typically unaffected by severe winter weather

Klaus Lysdal notes, "The winter hit a lot harder than usual in the South this year and it has caused a lot more damage than expected. Not only was nobody prepared for it but most of the traffic state departments were ill-equipped to handle snow. They simply did not have enough equipment."

Impact on the Logistics Industry

The trucking shortage has sent ripples throughout the entire logistics industry, affecting various stakeholders and processes:

1. Shipping Lines

Major shipping lines have been forced to issue advisories to their customers, warning of severe backlogs and potential delays. For example:

• Hapag-Lloyd has created a heat map to illustrate the gravity of the current trucking power situation
• CMA CGM has notified clients of "critical truck power issues" in specific areas

2. Freight Forwarders

Freight forwarders are experiencing difficulties in securing reliable truck drivers for their clients' loads. The situation has led to:

• Increased workload in finding coverage for truck movements
• Last-minute cancellations and rejections from truckers
• Reduced commitment levels from drivers

3. Exporters and Importers

Businesses involved in international trade are facing several challenges:

• Need to push up load dates to allow for extra delivery time
• Increased chassis days and overall shipping costs
• Potential delays in shipments

Industry Responses and Coping Strategies

In response to the trucking shortage, various stakeholders in the logistics industry are adopting new strategies and solutions:

1. Shipping Line Recommendations

CMA CGM has suggested several options to help alleviate the problem and mitigate delays:

• Clearing cargo at the port of discharge instead of inland ramp locations
• Submitting freight payments, original bills of lading, and customs clearance as early as possible
• Providing flexibility in warehouse appointment times and scheduling
• Considering termination of door moves at local ports or rails when truck power is unavailable

2. Trucking Industry Adaptations

Trucking companies are exploring new ways to manage their operations and meet customer demands:

• Negotiating with drivers to balance low-revenue and high-revenue loads
• Implementing local runs where one driver handles port pickups and deliveries all day
• Adjusting administrative processes to accommodate new operational models

3. Freight Forwarder Strategies

Freight forwarders are adapting their practices to cope with the unstable trucking situation:

• Allocating additional time and resources to secure truck coverage
• Developing contingency plans for last-minute cancellations
• Building stronger relationships with reliable trucking partners

Future Outlook and Potential Solutions

As the trucking shortage continues to challenge the logistics industry, several potential solutions and trends are emerging:

1. Increased Driver Compensation

To attract and retain drivers, the industry may need to significantly increase compensation packages. This could lead to:

• Higher trucking rates
• Increased costs for suppliers and consumers
• Potential industry-wide rate adjustments

2. Technology Integration

While full automation is still a distant prospect, the industry may accelerate the adoption of technologies that can improve efficiency and reduce the burden on drivers:

• Advanced route optimization systems
• Improved load-matching platforms
• Enhanced driver assistance technologies

3. Regulatory Review

There may be pressure to review and potentially adjust regulations that are exacerbating the shortage, such as:

• ELD mandate implementation
• Hours of service rules
• Driver qualification requirements

4. Alternative Transportation Methods

The industry may explore alternative transportation methods to reduce reliance on long-haul trucking:

• Increased use of intermodal transportation
• Expansion of short-sea shipping options
• Development of regional distribution hubs

Recommendations for Shippers

For businesses engaged in importing or exporting to/from the United States, consider the following recommendations to navigate the current trucking shortage:

1. Develop Multiple Contingency Plans

Prepare Plans C and D to prioritize certain cargo over others in case of last-minute cancellations or rejections from truckers. This may involve deciding between shipping only essential items or paying premium prices for guaranteed truck availability.

2. Extend Lead Times

Get your cargo prepared well in advance and maintain flexibility with sail dates. This approach provides a buffer to accommodate trucking uncertainties and allows you to capitalize on available trucking opportunities as they arise.

3. Consider Alternative Routing

Explore the option of using alternative ports, even if they are farther away. Ports with smoother gating processes and extended operating hours may offer more reliable options, potentially offsetting the increased trucking distance with reduced delays and associated fees.

4. Strengthen Communication with Logistics Partners

Maintain open lines of communication with your freight forwarders, customs brokers, and other logistics partners. Regular updates and collaborative problem-solving can help mitigate the impact of the trucking shortage on your supply chain.

Conclusion

The US trucking shortage is a complex issue with far-reaching consequences for the entire logistics industry. While there are no quick fixes, understanding the root causes and adapting to the changing landscape is crucial for businesses involved in international trade. By staying informed, developing flexible strategies, and working closely with logistics partners, companies can navigate these challenging times and position themselves for success in the evolving transportation market.

At FreightAmigo, we understand the challenges posed by the current trucking shortage. Our Digital Logistics Platform is designed to help businesses adapt to these industry developments by providing comprehensive solutions for freight forwarding, shipment tracking, and supply chain management. By leveraging our advanced technology and extensive network, we can assist you in optimizing your logistics operations and mitigating the impact of the trucking shortage on your business.

As we continue to monitor the situation and develop innovative solutions, we encourage you to reach out to our team of experts for personalized advice on how to navigate these challenging times in the logistics industry. Together, we can work towards ensuring a smoother, more efficient supply chain despite the ongoing trucking shortage.