COVID-19 Drives Tough Changes in the Trucking Industry
As the COVID-19 pandemic stretches on, all aspects of logistics continue to be impacted, including trucking and warehousing. At the moment, the high demand for essential goods has kept some companies busy. Nevertheless, companies throughout the industry are slowing down, dealing with disruptions, and working to stay agile in an ever-changing market.
Shifts and Disruptions to Trucking Companies
Truck operators, especially in North America and Europe, have been challenged by many factors throughout the COVID-19 pandemic and are altering daily operations. One primary change is the important classification of essential and non-essential goods. There continues to be high-demand for essential items, whereas the shipping volume of non-essential items have dipped drastically. The result is that trucking companies are having to change their operations and service lanes to meet shifting demands.
In addition, companies are working to implement all necessary procedures to keep their facilities and employees safe. This includes making sure drivers are healthy and safe, facilities are properly sanitized, and reasonable procedures are in place to protect all employees.
While working hard to make these adjustments, most companies have slowed down drastically and experiencing cash-flow problems. Many trucking companies already operate with very thin margins. This means when substantial slowdown or decrease in revenue occurs, cash and liquidity quickly become an issue. Though some companies have anticipated this by taking out loans, decreasing leadership salaries, and furloughing employees, for-hire trucking companies still lost more than 88,000 jobs in April in the United States alone. That is a 5.8 percent drop in employment from just the previous month.
Impacts on LTL Carriers
While some truckload carriers are continuing to stay busy, less-than-truckload carriers have seen a substantial decrease in volume. LTL carriers are more dependent on industrial goods, many of which are considered non-essential. Because many non-essential businesses have been shuttered, there has been a substantial decrease in freight volume. To combat this, companies are making workforce reductions, reducing salaries, and furloughing employees.
It seems that globally, the trucking industry as a whole is feeling some kind of impact from COVID-19, whether they’re slowing down, anticipating cash flow issues, implementing new safety procedures or simply working to stay flexible amidst great uncertainty and volatility.
Perhaps the best way for trucking companies to weather this period is by staying agile and being prepared to adjust quickly to the shifts and disruptions that these unprecedented times bring. As you work to ensure that your company stays strong during this crisis, always remember that our team of logistics experts is ready to assist you with any questions or shipping needs.