With the U.S. economy continuing to expand, trucking companies have had to keep up with ever-growing freight demand. They've been able to do so even with a significant shortage of licensed drivers in the country.
Instead of putting more trucks on the road and hiring people to drive them, the industry is opting to add more trailers (the boxes holding the cargo) to increase the capacity each individual driver can haul. About 70 percent of those surveyed plan to expand capacity by buying more trailers, the highest level since 2007, according to CK Commercial Vehicle Research's most recent Fleet Sentiment Report.
"This survey has been a good predictor of future orders" of trailers because it polls both large and small fleets as well as both public and private operators, said Karen Ubelhart, a Bloomberg Intelligence analyst.
Hours of Service regulations, which came into effect on July 1, 2013, reduced the hours a trucker can drive while increasing how often he or she must take breaks. The aim was to mitigate driver fatigue and accidents, but it also meant that the amount a single driver could haul declined.
There's been a trucker shortage since the middle of 2010, and the shortfall peaked at about 253,000 drivers at the beginning of 2014, according to FTR Associates. The U.S. economy still needed about 107,000 additional drivers as of the second quarter of this year, FTR's index shows.
Adding more trailers improves productivity in one of two ways, Ubelhart said. In states where it's permitted, truckers "piggyback," attaching a second trailer to an existing tractor.
The other way to use a tractor more intensively is by having extra trailers loaded and ready to go so drivers can drop off and pick up freight more quickly, she said. Less idle time for drivers improves productivity.
Just like a restaurant owner likes to "turn over" tables frequently, fleet operators like this faster turnaround time because it allows for greater use of their tractors, Ubelhart said.
In reaction to the driver shortage, trucking companies have also raised wages and given sign-on bonuses to attract drivers, Ubelhart said. Trucking company Knight Transportation Inc., boosted driver pay by 5 to 10 percent earlier this year.
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