This was an important year for the U.S. transportation industry. Take a closer look at this year’s biggest trucking industry milestones and how they will affect which direction it moves.
What 2016 Trucking Industry Milestones Mean for Carriers and Owner-Operators
The trucking industry is ever changing, impacted by advances in technology, regulatory changes, consumer and business demand, and so on. Whether you’re a trucker, owner of a freight company, or an investor in the trucking industry, looking back at your industry and compiling a year in review will help you plan your business before the new year hits.
Trucking Industry Milestones 2016: Looking Back and Planning for the Future
When the new year rolls around, everyone wants to make the best resolutions for the coming year to get themselves off on the right foot. You should do this not only for personal goals, but also professionally. The trucking industry is no exception, and what better way to plan your resolutions than to first study up on the trucking industry milestones that made the most impact during this past year.
Turnover Rate on the Decline
In the recent weeks, studies showed that the driver turnover rate hit a five year low as it dropped to 81 percent (a number that is admittedly still incredibly high). This driver turnover rate applied to large truck fleets with more than $30 million in annual revenue. This decline was not the first of the year as the rate has now dropped 4 times this year. According to the ATA, one of the big reasons for this is that inventory movement is in high demand and the industry seems to be on an upswing in many areas. A lowering driver turnover rate is a great sign of stability in an industry looking and searching for just that.
New Regulations and Standards
Driver’s Safety: In the first half of 2016, there was an increase in traffic fatalities of 9 percent. While the trucking industry isn’t directly responsible for all of these fatalities, the increase resulted in U.S. transportation policies focusing on making truck driver performance and safety a hot topic this year.
The Environment: In August, the EPA finalized its draft for emissions standards with a 2027 plan that includes reducing greenhouse gases by 25 percent and cutting spending on fuel for drivers in the US by over $170 billion.
Logging Hours Electronically (ELD Mandate): While regulations on hours worked are no secret in the trucking industry, new federal mandates for truckers to use ELDs (electronic logging devices) is a trend to grab hold of now. The Commercial Vehicle Safety Alliance ran their annual road check campaign this year and more than 1,000 drivers were placed out of service during this check for a combination of hours of service compliance issues and false hour logs.
Trucking Rates on the Uptick
In the U.S. as a whole, rates are up in the trucking industry especially in east to west transportation. Overall rates are up about 6 cents per mile, but some of the biggest outliers are: California to New England (18 cents), Upper Mountain States to the Southeast (17 cents), Pacific Northwest to Florida/Georgia and Lower Mountain to Lower Atlantic States (16 cents). While an uptick in rates are normal in the fall, this continued trend upward late in the year is a good sign for the trucking industry.
Projected Transportation Industry Growth
According to studies by the American Trucking Association and Forecast, the trend in the trucking industry is that demand for freight movement will increase creating opportunities for business growth in the transportation sector. Overall, freight tonnage is expected to grow 35 percent next year with trucking growing at 27 percent. As a carrier or owner-operator in this industry, knowing how to take advantage of this growth in the coming year is your key to success.
Technology Take-Over
Growth is one thing, but understanding which tools you’ll need to be a part of that growth is important when making your New Year Resolutions as a member of the trucking industry. In 2016, some big things happened in the technology realm within the transportation industry.
In the fall, self-driving truck Otto successfully made the first fully automated delivery. Otto (owned by Uber), is a sign the automation revolution in the trucking industry is finally here.
This summer, Daimler Trucks rolled out its first fully electric truck, a Mercedes-Benz weighing 28 tons. This is a sign that the once unaffordable cost of a fully electric truck is coming to a turning point.
What Trucking Industry Milestones Will We Hit Next Year?
When it comes to New Year Resolutions, you can’t make them effectively without reviewing that year you had to see where you need to make changes. In the trucking industry, increased regulations, the perfection of technology and automation, and increased demand are all great signs and should be part of your resolution plan. If you can take these into account while also investing in new technology for your business, the year 2017 may be your best year yet.
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