Tough trucking
It doesn’t take an economist to tell you these are tough times for truckers. Nonetheless, if you are going to gauge exactly how tough these times are, it sure helps to consult some meaningful numbers.
A national carrier study recently conducted by Transport Capital Partners, LLC,, says managing partner Richard Mikes, reveals fleets are “adjusting to the new economic environment– most expect decreased volumes, shipper pressures for lower rates, staff adjustments and interest in both buying and selling companies.”
Mikes points out that the share of carriers expecting volumes to decrease in the next 12 months was 37%– compared to 34% reporting declining expectations back in November– while steady volumes were expected by 42%, compared to 38% in the earlier survey. Those expecting volumes to improve went from 16.5% in November to 21% this month.
Interestingly, those choosing the “no response” reply dropped from 12% in November to exactly 0%. Mikes says that “shows all respondents chose to express an opinion and that there is most likely not a real shift in expectations.”
I think the reason for that is things have finally gotten to the point that no one, in tucking or anywhere else, is uncomfortable stating a point of view about this recession– be it pessimistic or optimistic.
The survey also delved into such key factors as freight-rate expectations, shipper credit concerns, equipment acquisition decisions, and whether non-driver staff has been reduced.
Not everyone in trucking sees the glass the same way…
Also telling is that almost 25% of the carriers responding said they “had given serious consideration to leaving the transportation industry or liquidating if tonnage does not increase in the next six months.”
And while 27% said that they would be interested in selling their company in the next 18 months, 36% said they would be interested in buying a company in the same time frame.
The survey’s results certainly reflect tough times. But they also underscore the resilience and “can do” attitude that always sets trucking apart, no matter what is the shape of our economy.
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March 4th, 2009 at 10:38 am
David,
It’s really not that surprising to see a percentage of business owners desiring to sell their business and another considering buying a business. History has shown us that in economic downturns, in many business sectors, there is consolidation. Some exit the market place, some merge and produce larger, stronger companies, and some trudge along as survivors. It will certainly be interesting to see who does what over the next few years.
Robert.
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