Quote:
Originally Posted by GMAN
I expect the industry to go through some changes over the next few years but it will still exist. Trucks are the only way most products can get from one part of the country to another in a timely manner. Rail works to some extent, but cannot meet the shorter time sensitive delivery schedules of trucks and cannot offer door to door service. Rail is already nearly at peak capacity. It is much less expensive to put more trucks on the road than rail. Trucks will be around for some time. There will be changes, but trucks will still be around.
I'm afraid I have to disagree with this part. Rail is the most efficient means of moving freight across solid land, in terms of energy. However, the time factor works against them. I once had a broker tell me that he could get a load across the country for much less then the cost of trucking, but could not meet the time deadline. Two days by truck, and seven to ten days by rail. And, because of the amount of tracks that they've discontinued over the last twenty five years, it now requires trucks to move the freight between the rail head and the customer. Where it might take a train 15 days to get a load from the northeast to southern California, it only takes a truck 5 days to deliver that same freight. The "JUST-IN-TIME" factor will keep trucks running for a long time to come. Companies can reduce their stock inventory, thus reducing their taxes, and other costs, and still keep their production going. Instead of maintaining stock for 15 days, they can reduce it to 5 days worth of stock inventory. It means lower investment in warehousing, property tax, maintenance, and at the end of the fiscal year, the amount of inventory on hand also affects the amount of taxes they pay. Inventory is also one of the major reasons freight slows down. When they are working on inventory for taxes, they want as little as possible, so they pay as little taxes as possible. Keeping 15 days worth of inventory as opposed to 5 days would increase their taxes considerably. The rest of the year tends to be more normal.
There are also some commodities that do not keep well over that period of time. Some foods, and especially flowers would not survive well at all.
The highways have improved, equipment has improved, safety has improved. Yes, trucking is not what it use to be. But trucks are not about to disappear over the horizon in the near future. Someone going into trucking today can expect to see trucks on the road long after retirement. Will they look the same? Not if California has anything to say about it.