Gman, I know you probably have seen some of these cycles before with capacity shrinking. The trend seems to be one of consolidation but I just read the below article and I have read elsewhere that the need for trucks is going to increase. I'm sure these big companies know the need for trucks.
Do you see a difference in the type of person today becoming an O/O rather than in the past? I remember talking to a dispatcher at LCT (that kid was great) and we were talking about Harvey Gainey the owner and in this kid's opinion he felt it was easier to get into the business back then; that it was easier to get contracts back then.
You know also I was thinking today, this morning TQL called and an O/O was on a load and went to pick up and he couldn't load as he had a hole in his trailer. It got me thinking, it's so hard to get a customer, yet these people will seemingly put the load on any schmoe with an MC number. In the end you get what you pay for.
I wonder if it was always like that, that they don't seem to care about service they just go on price. I remember LCT had a 75% on time rate, I don't know how they keep thier contracts.
Anyway here is the article:
Feb. 13) WASHINGTON, D.C. — Transportation is already a costly challenge for many in the produce industry, and things are likely to get worse.
That was the message Bruce Blanton, associate deputy administrator of the Agricultural Marketing Service’s transportation and marketing programs, delivered to the U.S. Department of Agriculture fruit and vegetable industry advisory committee during its Feb. 8 session here.
Blanton said U.S. production of fruits, vegetables and nuts is expected to increase from 203.6 billion pounds in 2007 to 228.7 billion in 2017. Meanwhile, horticultural imports are expected to increase from a little more than 30 billion pounds to more than 45 billion in the same time period, while exports are expected to climb from about 18 billion pounds to 24 billion.
“That’s steady growth,” Blanton said. “What does it all mean? Demand for transportation services is going to go up with it.”
Blanton also said the U.S. Department of Transportation and the Federal Highway Administration are “expecting a tremendous increase in truck traffic” on U.S. highways.
Blanton presented two maps, one that showed long-haul truck traffic in the nation in 2002 and another that showed estimated truck traffic in 2035. The maps used red lines to show traffic, and the lines became thicker according to volume.
“California is one big highway,” said Matthew D’Arrigo, vice president of D’Arrigo Bros. Co. of New York Inc., New York, after seeing the 2035 map.
That comment drew chuckles from his fellow committee members, but those maps and another set of maps illustrating the projected increase in peak period congestion on the national highway system don’t bode well for shippers.
Meanwhile, a 2002 study by the department of transportation estimates the driver shortage will reach more than 100,000 by 2014.
The produce industry has become increasingly reliant on trucks. Blanton estimated that 5 million truckloads of produce — perhaps more than 95% of all shipments — were moved by truck last year. That’s more than 200 billion pounds transported by truck, compared to 1.4 billion shipped by rail.
Rail might be a serviceable alternative to trucks in the short term for some commodities. According to the Association of American Railroads, many lines were below or near capacity in 2005. However, the number of lines projected to be at or above capacity by 2035 is staggering. The association estimates that its industry needs $148 billion in investments over the next 28 years.
“Fruit and vegetable production, imports and exports are increasing,” Blanton said. “All modes are close to capacity or at capacity, and congestion problems are expected to get worse.”
Blanton said the agriculture industry needs to communicate its needs to the department of transportation now rather than wait until the problem is more severe