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Today’s Freight Capacity Crisis: Where Do We Go from Here?
October 9, 2018
Following the 2017 Hurricane Season, capacity for the over-the-road freight transportation began to erode quickly. At first, some considered the shortage to be a short-term issue due to the capacity absorbed by the emergency response to hurricane seasons in Florida and Texas. Others saw it as simply part of the natural up-and-down pattern of freight capacity. But then came the electronic logging mandate in December 2017, and hours of service began to shrink, which further compounded the issues surrounding the driver shortage.
This particular capacity crunch has continued and deepened longer than expected due to other factors, including soaring freight volumes. Trucks in the United States moved 10.77 billion tons of freight in 2017, up from 10.42 billion in 2016, and 2018 is setting up to be another record-breaking year in over-the-road freight movement. With truck utilization at nearly 100 percent, many experts and analysts don’t see a break in capacity for shippers for at least another 12 to 18 months. So, the question is how to endure during an extended tight capacity market or any other challenging market conditions.
The capacity crunch is especially difficult for those who didn’t plan ahead and lock in carrier contracts in early- to mid-2017. For most, change will be required to adapt to this unfamiliar environment, and that change begins with evaluating three primary areas of a shipping operation:
Carrier relationship management
Systems and tools
Data management and analysis
Read the full blog post to begin developing strategies to navigate through the current and future capacity crises and develop more agile, nimble operations. A renewed focus on operational efficiency will help organizations to maximize productivity and create a competitive advantage to ensure goods are getting to market and customers are getting the service they demand.
This blog was first published in an issue of Talking Logistics, an online publication produced by Adelante SCM.
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