31 Oct What’s Causing Trucking Companies To Go Bankrupt?
As of the time of this writing, 640 trucking companies have gone bankrupt in 2019 alone. This includes major names like:
- Carney Trucking Company
- Starlite Trucking
- ALA Trucking
- Terrill Transportation
- Williams Trucking
- Ready Trucking
- HVH Transportation
- Falcon Transport
- New England Motor Freight
The bankrupted companies represent a diverse swath of trucking businesses, from all different regions of the U.S. as well as with fleets ranging from drivers in the dozens to the hundreds. With this much variety, it begs the question: what’s wrong with the trucking industry? Here’s a look at what some of the root causes may be, and what the shipping industry needs to do is adapt.
Signs Of Trouble
Perhaps one of the most stunning bankruptcies on the above list was New England Motor Freight. With over 1,300 drivers as well as being the 19th-largest less-than-truckload company in the country, this didn’t seem like a company set to fail. In a statement, president and COO Thomas Connery cited high labor costs and other associated expenses with the trucking industry as major causes behind the filing.
While the stories behind their decisions may be different for each of these companies, one thing that does hold true is the concept that it’s becoming more and more expensive for trucking companies to do business. An ongoing trucker shortage that’s been happening for decades means that there’s a demand for higher wages to keep truckers interested. Even then, there are many people reluctant to deal with the added difficulty of a trucker’s lifestyle. In addition, as Connery’s statement alludes to, it’s become more complex and costly for companies to do business.
Adapting Your Shipping Strategy
If you’re running a shipping company, what does this enormous shift mean for you? First and foremost, we’re seeing an uptick in the market for the first time in 2019 so far. Combine this with the fact that the holidays will be coming soon, and shipping companies need to quickly zero in on their carriers. The field of trucking companies to use has quickly shrunk by a massive amount, and this will cause a demand crunch later in the year. While the major businesses like Wal-Mart or Amazon will likely get all the help they need, smaller companies need to be ready to work ahead.
In general, markets tend to be elastic, and even after we’re seeing so many companies going bankrupt, the market is showing some signs of recovery. It’s important that you’re ready to take advantage. Locking in a carrier capacity is a good start, but cost optimization leveraging digital technologies is the way forward. Digital freight management is a growing trend in the trucking industry, helping achieve cost efficiency and improve bottom-line. Digital platforms are the future and will give competitive advantage to shippers and carriers both.
This is where Hwy Haul comes in, a digital platform designed to change the way loads are moved across the US, from the largest shipping companies to smaller mom-n-pop shops. Hwy Haul offers a comprehensive solution to address the issues like freight matching, real time load tracking, trip optimization and document management. With auto-match and real-time freight-tracking, you don’t need to waste time trying to communicate back and forth between suppliers and carriers to figure out what’s happening with your freight. In addition, this is essential for reducing empty miles and increasing driver income and job satisfaction. As the trucker shortage grows, keeping your existing drivers happy and effective is paramount.
Our goal is Connecting Shippers to Truckers – Seamlessly! If you’re interested in learning more about Hwy Haul, contact us at email@example.com.