The realities of a prolonged trucking recession were reflected in the latest Top Industry Issues survey conducted by the American Transportation Research Institute (ATRI), with the driver shortage falling to its lowest ranking in the survey’s 20-year history and driver retention falling off the list completely.
Speaking at the Isaac Instruments User Conference in Dallas, Texas, ATRI president Rebecca Brewster noted the driver shortage fell from fourth spot to ninth, while the economy topped the list for the second straight year.
Lawsuit abuse reform climbed three spots to third, while truck parking remained in second place but first among driver respondents. Brewster said, “Thirty-one years after starting this job, one of the first research projects I worked on was on truck parking and we’re still talking about this issue.”
Driver detention ranked fourth on the list and is an issue that affects driver productivity and pay as well as safety. A recent ATRI survey found that nearly 40% of stops at shippers and receivers involve driver and equipment detention of two or more hours, Brewster said. Female drivers experience more detention time than their male counterparts, as do drivers hauling spot market freight.
ATRI pegs the total cost of driver detention at 5.4 billion lost miles, US$3.6 billion in direct unreimbursed expenses, and US$11.5 billion in lost revenue.
Safety impact of driver detention
“Detained trucks driver faster,” Brewster added. “It has a very important safety implication.”
Research shows truckers drive 14.6% faster before and after being detained at a shipper or receiver.
“Detained drivers not only are driving faster on the back end because now they’ve lost time and need to catch up, they’re also driving faster [while] going into those facilities because they know they’re going to be held up and they’re trying to get there earlier to lessen the likelihood of being detained a long time,” she said.
And truckers can hardly afford to lose time. ATRI research shows operating costs reached a record high in 2023, at US$2.27 per mile. That compares to US$1.699 in 2019.
One of those rising costs is insurance, with insurance cost and availability climbing to fourth spot from ninth in 2021.
Congestion is also eating into fleets’ profits. Road congestion cost the industry US$94.6 billion in 2021 — the highest ever recorded — and up 27% from a 2016 baseline. That’s equal to 460,000 truck drivers sitting idle for an entire year, Brewster said.
Concerns about BEVs
Another rising concern is battery-electric vehicles and the push to transition to them, particularly in jurisdictions such as California.
“Is California ready?” Brewster asked. “They’re pushing for battery-electric vehicles but can they handle battery-electric vehicles?”
She thinks not. California has the second highest cost of electricity per kWh in the country. If every car and truck in the state were to go electric tomorrow, they would require more than 57% of the state’s current electricity supply.
Brewster noted renewable diesel is an overlooked alternative with a greater reduction in overall carbon output, which can be dropped into the trucks already on the road today.
“What renewable diesel needs is a PR campaign because it’s a much better option,” she noted.
Trucking to return to ‘normal’
Brewster was joined on stage by Bob Costello, chief economist of the American Trucking Associations (ATA), who summarized the economic outlook he shared at the association’s recent Management Conference & Exhibition.
Currently, he said, trucking is in a state of stagflation with shrinking demand and rates, coupled with rising costs. “It’s a horrible place to be. Horrible,” he said.
However, he said the macro-economy will improve trucking conditions slightly in the coming year, at least back to what was considered “normal” before the Covid-19 pandemic.
Fleets are doing all they can to reduce costs and survive, including some illegal activities. Costello said there’s an increased use of Mexican “B-1 visas” for drivers making domestic hauls within the U.S., and the Department of Homeland Security is looking to crack down on it. He also said some carriers are now taking out insurance policies on a single truck while operating several uninsured trucks under the same policy.
More capacity will have to leave the market since freight demand is only expected to grow modestly, Costello said. It’s already happening, with 9.2% — or 34,000 carriers — with interstate operating authority having ceased operations between December 2022 and August 2024.
“I think we’re getting to a better spot,” Costello summarized. “The macro-economy is slowing, but if you look at what is happening and how the economy is shifting, I think it benefits us a little. Trucking demand should improve a little bit as a result, and I think it puts us back to normal.”
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