The North American trucking Industry finally took a turn for the better in 2018. After nine years post-economic crisis, nine years that lay witness to an opportunist market whereas non-asset based carriers (load brokers) capitalized on cheap, cheaper and cheapest. Knocking on every shipping door, these brokers were offering reduced rates and taking full advantage of desperate carriers and eventually forcing all asset base to play in the same sandbox.
Shippers took full advantage of this downward trend and who could blame them, after all the service levels did not fail and their profitability maintained a healthy return. All carriers suffered dearly through this era along with their staff, drivers and owner-operators; all being hit with severe pay cuts. Some in the industry would suggest that the trucking industry alone absorbed the burden of a severe downward economic environment while others completely reaped its economic benefits.
Early 2017 brought brighter horizons as carriers noticed an opportunity to increase rates due to a stronger economy. The growing economy coupled with the 2017 American E-log mandate shed light on a severe driver shortage. Canadian cross-border carriers were finally on an even playing field, virtually eliminating bad carriers.
Carriers wasted no time raising rates to recover long over-due cost of equipment, parts and supplies allowing for a profit margin that had seemed virtually impossible for nine years. Most quality carriers immediately took to increasing driver wages, staff wages and even owner-operator wages that had hit rock bottom. This new well-founded and deserved attitude was met with a sense of cautious relief amongst all, from staff to drivers to management.
As we move along in this new era, now in our sixth month, as business owners themselves encouraged by acceptable returns, thrilled that we are in a position to buy back some of our debt and although it is finally exciting to be in trucking again, there is always a looming sense of the bottom dropping out of our industry.
The confidence in our industry to remain disciplined is low, owner-operators which make up a large part of the Canadian industry are simply holding on to old equipment fearing a five-year commitment and financial obligation that comes with a new truck.
The industry has a responsibility to restore confidence and implement a trustful environment to gain back the respect of our workforce. Fair rates based on cost and a sustained growth with respect to better pay is a must. We must remember that a quality fleet now means efficient service to our clients and in turn increasingly fair wages for employees. Any step backwards is a step in the wrong direction management has to remain focused and disciplined enough to maintain integrity.
The future of trucking depends on all of us doing the right thing, teamwork is a must to ensure the wellbeing of our industry- carriers, clients, drivers, staff and management included.