What is the Outlook for U.S. Trucking Industry?
Reported by: Jonathan S. Reiskin, Associate News Editor
Is the trucking industry as we know it in North America changing? Will trucking careers slide downward and may even eventually become somewhat “obsolete?” Many experts believe it will and are advising that the shear core of the U.S. trucking foundation is on very shaky ground.
Trucking in North America is in the midst of a fundamental reshaping which, according to James Hebe, a senior executive of Navistar Inc., “will lead to flat tonnage levels for fleets and fewer truck manufacturers producing much more expensive vehicles, mostly in Mexico.” Mr. Hebe, further noted that federal policies will cause the demise of a number of trucking institutions such as “long and tall tractor design, owner-operators and independent maintenance shops.”
He further noted that long haul operations will shift to regional positions and dedicated contract carriage for distribution and that “the availability of truck-rail intermodal for many linehaul movements of more than 1,000 miles and the shock of $4.75-a-gallon fuel last year mean “fuel prices have changed the world.”
Believing there will be a surge in truck sales within the second half of 2009, he states that this will just be a “suckers’ rally” but it is “only so buyers can avoid more expensive 2010 trucks equipped with new emissions controls.” Due to high fuel and equipment prices and the onset of electronic on-board recorders, this he said will be the “death knell” for owner-operators because they will not be able to survive by running legal.
He also pointed out the high cost to truckers due to the current administration policies for unionization. The cost of unions, he said, is driving manufacturing jobs primarily to Mexico. He pointed out that “there are no unemployed truck workers sitting around in Mexico. We will have to train truck builders who have never built trucks before — and that means a ramp-up will have to be slow, or quality will have to suffer.”
With 38 years of experience under his belt, he believes “truck pricing will increase dramatically. If you think the pricing in 2010 is bad, you haven’t seen anything yet.”
Summing it up, we must wonder if the outlook for the U.S. Trucking Industry is about to be shaken to its core.
According to Mr. Hebe: “Truck jobs in the U.S. are gone and will not be coming back.”
Your thoughts?
Allen Smith
© 2009, AskTheTrucker. All rights reserved.
: industry, james hebe, long haul, mexico, owner operators, regional, Truckers, trucking, truth about trucking, u.s. trucking, unions
Related posts
Tagged with: industry • james hebe • long haul • mexico • owner operators • regional • Truckers • trucking • truth about trucking • u.s. trucking • unions
Filed under: Politics • Truck Driving Jobs • otr trucking • trucking • trucking companies • trucking life
Like this post? Subscribe to my RSS feed and get loads more!
Can’t we just try to have a positive outlook on the trucking industry? Everyone has to be god darn negative these days, sure the economy is down but for goodness sales let’s all just try to have a positive outlook. I don’t blame people for being upset though but still.
Hi Tyler: This is also a “news” blog….we post many sides to the story here to get thoughts and opinions from others …. many of us are trying to keep a positive outlook, but sticking our heads in the sand won’t do any good either…..Allen
It’s very easy to acquire a negative outlook on trucking when so many Drivers this year are sitting so much waiting and waiting for loads.
Example: One driver states he (general term) gets about 1900 miles a week and is out for 2 weeks.
He is basically rolling 6 days and SITTING for 8.
Yes, what a positive outlook for Newbies.
One spends more than one makes.
The People that believe the LIES purported by these “recruiters” in that the Lease to own deal is a good way to go yet there isn’t enough freight to substantiate the program, yet YOU’LL MAKE LOTS OF MONEY, so sign here.
It has been said that “One can make a small fortune in Trucking, if one starts with a Large One”.
With all the continually added RESTRICTIONS and ASSAULTS upon Trucking, where from does one derive a Positive Outlook??
http://www.atri-online.org/index.php?option=com_content&view=article&id=164&Itemid=70
Cannot park here or there, cannot Idle for HEALTH REASONS, cannot go here, cannot go there, cannot park longer than 2 hours, NO OVERNIGHT PARKING, NO TRUCKS ALLOWED. Then there are the truck slops with their excuses of cleanliness and stinky, miserable shower facilities. The Truck parking lots which are basically Toilets because of the LAZY SLOB Truckers who cannot walk 100 yards.
There’s also the Body Mass Index assault:
http://www.nhlbi.nih.gov/guidelines/obesity/bmi_tbl.htm
Sorry, I cannot really think of positive things about trucking and i’ve been a trucker since late ‘98.
[...] Part time trucking U.S. Trucking Industry Stumbling? | AskTheTrucker.com [...]
John: everything you “say” is understandable and true! Yet, many do enjoy life as a trucker …. a big key is finding that good company…and they are out there … miles have fallen drastically for many drivers in today’s economy and there is a lot that needs to be cleaned up within trucking …. OTR trucking. We have talked about the leasing scam, here, and on our talk show, as well as other aspects of the trucking industry. Newcomers have got to learn BEFORE they enter into OTR trucking …. jumping in a truck for a new career without first really investigating it will most likely, lead to failure. Thanks for your post ……… Allen
I agree with some of the comments that we tend to get caught up in the “negative” selling of the news. No doubt we have economic problems but keep in mind the majority of this country voted to make a change and that change is here so we live with it and deal with it. Change the attittude and quit concentrating on scarcity vs abundence. Trucking is not any different than other business situations, everyone is trying to find the “good” in things and make it work. Just remember, “If you keep thinking what you’re thinking, you’ll keep doing what you’re doing and you’ll keep getting what you’re getting. So, keep positive thoughts, it’s the law of attraction and make things better.
Well said, Dave – I’ve discussed “attitude” before and how it can play a big part in a person’s success, no matter what they are in — however, eventually with such issues that really need changed or made for the better, there sooner or later must be “action.” Thanks for your comment …. Allen
Warren Buffett just bought (BNI) Burlington Northern Santa Fe Rail company, so i think that means that long haul will disappear and regional and interstate hauling will be very positive. thats due to the fact that rail is less costly and can pull 100 trailers at a time. there will be lots of infrastructure on Rail Road.
Excellent point! The ray of light I’ve been holding onto is the creation of Hybrid trucks or better. Depending on the supply of crude, it could take 10 to 20 years for it to happen. I only worry that in that span of time, the trains will take over hauling a majority of the freight. If trucking is a 600+ BILLION dollar a year business, you would think it would be up there on the list with AIG in order of importance to the economy. Yet, look what happened to the U.S. steel industry in the 80’s. It literally evaporated in 10 years, and I saw it happen right before my eyes on the east side of Chicago and in Gary.
Exactly. They have become more silent on this rail thing, but I’m keeping my eye on it …
There is no hope in trucking! Wake up! We are in a depression. I agree there are a few good companies out there but they will be force to go with the flow or get out of the game! Companies can’t pay what companies don’t make. Freight is down, rates are down and the government is tightening the noose! Point system to get rid of drivers, high fines for companies and more regulations! I thought the industry was deregulated! Before long Mexico will be hauling our freight! Just remember what I say, it will happen. The only companies that will survive is those that have interest in Mexico and Canada! They will be no more good pay. A couple of companies will have a monopoly of the trucking industry. They will be no owner ops. You can make a new truck payment now with the rates as they are. You can barely afford the fuel! The worst is yet to come, and we will all pay for it when it gets here, all consumers will pay or starve!
I have been a lease purchase driver for going on 3 years, and i can speak from experience when I say that the industry is suffering, and I agree that changes are coming but I think if the drivers roll with the changes as I have they will see some tight weeks but can still make a living, Leasing is not the devil, and in my opinion you are going to see a lot of companies dialing down there company operations and dialing up the owner / Operator or Lease purchase programs, as they should too insure there survival during these hard times. Basically becoming load brokers and leasing companies, if you look at some of the companies that are still on top (be it a smaller hill) they are all doing the same thing, ramping up there L/P programs and have been dealing with rail companies for years before the bubble burst.
I think that too be a successful truck driver in the future you will have too have a lease or own a truck. the trick is too find the right company.
a few words of wisdom:
Don’t even think of hauling for a percentage, major trucking companies are fighting tooth and nail for every pallet of freight, which translates into low bids too get it. Always run by the mile.
Make sure your getting 100% fuel surcharge or a flexible charge with a minimum empty pay of .36 per mile. this helps cut your largest expense which is by far fuel.
Don’t get into a new truck lease, to do so is do doom yourself too failure right out of the gate, these payments are between 450.00 and 700.00 per week and with the average trucker only turning 1900 miles per week you’ll be lucky too even draw a check at all.
Checkout the company, make sure (again my opinion) they deal with the rail-road, because as I said I believe that all long haul freight will be headed this way before long, my average haul is about 500-700 miles.
Get with a company that does a lot of drop and hook at 500-700 miles per load you don’t have time to be held up loading and unloading much.
Do the math figure out what your break even miles need too be. it should be no more than 1200 miles in general if your truck payment is around 300.00-350.00
Don’t lease or purchase a truck with too many miles on it, try too stay 350,000 too 400,000 on your miles, you don’t want too find yourself finishing a lease and/or paying off your truck only too find its not worth having, you don’t want your paid off truck to have 800,000 miles on it.
Cut your cost anyway you can, just because your truck can run 80 doesn’t mean its smart too do so. every mile per hour you go over 60 mph will cost you 0.10 in fuel economy and if my math is right traveling 70 mph will cost you around $200.00 per week in fuel expenses on a 2000 mile week. thats the difference in a $500.00 check and a $700.00 Check
If you can afford it, it is well worth putting a APU or generator on your truck. this alone will save you 6-10 gal. per day in fuel. which is another couple hundred extra in your pocket.
When the economy picks back up, so will the freight industry, but it will have changed to be more stream lined. the trick is too stay informed on whats going on and try too beat it too the punch. I net after all expenses $700-$900 per week by watching out for the trucking trends, watching costs and knowing where too accept loads too, learn your companies freight lanes.
I have been in trucking 18 yrs., 7 of which have been O/O. With last company 3 1/2 yrs. Had to leave after 3 cuts in contract in the last yr. Was only averaging 100 miles a day at $0.82 a mile. Had to cancel contract, was costing me to run! I could not afford anything but the required minimum. No health ins, unemployment or retiement plan! Yea, compnies like O/O’s! They don’t have the extra cost as with company drivers and they don’t pay O/O enough to afford needed benefits! But yet as an O/O, I had an accident that was not my fault! They company accepted blame and paid. I was not even informed of this and found out about it almost a yr. later! I was contract but the company did what they, I think, was in their lowest cost option. I had no say and my background meant nothing. How can a company do this? It was my truck and I was contracted, but yet I had no say in how this was handled!