PHOENIX (Jan. 7, 2014) — For the trucking industry, 2013 was a challenging but profitable year despite a lukewarm import and export market, according to Andy Ahern, CEO of Ahern & Associates Ltd., a Phoenix-based transportation management consulting firm.
Still, more challenges await the trucking industry this year. He noted that a proposed increase to the federal fuel tax in 2014 would dramatically impact fuel costs for all trucking companies and shippers.
"In addition to this upcoming legislation, the full effects of the recent Hours of Service legislation are just beginning to be understood, with Transport Topics (the newspaper of the trucking and freight transportation industry) reporting that overall driver wages may have been significantly impacted across the U.S.A.," he said.
Predicted interest rates, GDP changes and inflation are giving little reason to expect that these factors will be compensated for by a general economic upswing, Mr. Ahern added.
He advises trucking companies "to prepare for the unexpected."
Meanwhile the American Trucking Associations (ATA), in its U.S. Freight Transportation Forecast to 2024 report, predicts about 64-percent growth in freight revenue over the next 10 years.
"The trucking industry continues to dominate the freight transportation industry in terms of both tonnage and revenue," said ATA Chief Economist Bob Costello, noting the ATA projects trucking's share of tonnage will rise to 70.8 percent by 2024 from 68.5 percent in 2012.
Freight revenue is expected to grow by 63.6 percent to $1.3 trillion annually by 2024, and the trucking industry's share of those revenues is predicted to edge up to 81 percent from 80.7 percent in 2012.
Truckload volumes will grow 3.2 percent through 2018 and 1.1 percent annually from 2019 to 2024, according to the ATA. Less-than-truckload volume is predicted to climb 3.5 percent annually through 2018 and by 2.4 percent until 2024.
Conversely, the rail industry is expected to experience anemic growth for rail carloads of just 1.5 percent through 2018 and 0.4 percent from 2019 through 2024, contributing to a decline in market share to 14.2 percent from 14.8 percent in 2011, the ATA predicted.
However, intermodal rail will continue to be the fastest growing freight mode, the ATA said, growing an average of 5.1 percent a year until 2018 then slowing moderately to 4.8 percent annually through 2024.
Other modes of transportation, including air freight, waterborne transportation and pipelines will see moderate volume and revenue growth, according to the ATA.
Trucks continue to be the dominant mode for freight movement in the U.S., according to recent data from the Census Bureau and Bureau of Transportation Statistics. In 2012 trucks moved 73.7 percent of all freight by value and 70 percent of tonnage vs. rail transporting 3.3 percent of value and 15.8 percent of tonnage.
The average miles per shipment by truck were 212 miles. Only 15 percent of all freight shipments were longer than 500 miles and about 9.7 percent of shipments traveled more than 750 miles.
Only 3 percent of freight tonnage moved on multiple modes—such as by train and truck or by barge and truck, according to the report.
"The Commodity Flow Survey showed once again that trucks move the vast, vast majority of freight in the United States," Mr. Costello said.
"The length of haul data is crucial, particularly when talking about rail and truck competition," he said. "While feasible under certain conditions, the potential for rail intermodal to gain a significant amount of truck market share is limited. Now more than ever, the two modes are more likely to complement each other than compete for business."
How have local road conditions and/or road construction impacted tire repairs/automotive services at your dealership?
|We've seen an increase in business.||
40% (17 votes)
|Things are holding steady.||
50% (21 votes)
|Business is trending down.||
10% (4 votes)
|Total votes: 42|