It looks like the supply chain crunch isn't about to ease up, despite positive comments from a number of sources. The latest sector to take a hit is the transport industry - the very people who have to move supplies through the chain from origin to destination.
Supply headwinds facing the trucking industry were front and center at an investor conference on Wednesday and Thursday. While executives said driver recruiting and broader supply chain bottlenecks are ever so slightly easing, the procurement of equipment has gotten tougher.
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Derek Leathers, Werner Enterprises ... said current tractor and trailer orderbooks extend well beyond the OEMs’ manufacturing capacity for all of next year, meaning the industry fleet, which has gotten older and smaller during the pandemic, won’t be increasing anytime soon.
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Trailer manufacturer Wabash said it would build only 50,000 dry van trailers next year compared to more than 57,000 in 2019. The company’s backlog, which extends into 2023, has increased to more than $2.3 billion from $1.9 billion at the close of the third quarter. It’s in the process of converting refrigerated manufacturing capacity to dry van production lines but that won’t be completed until early 2023.
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Difficulty finding workers throughout all levels, from maintenance techs to office employees, has been a burden for the company.
“In the past, we were able to tweak pay or turn pay and that typically would fix 95% of the problem. Today, that’s not the case when it comes to labor,” Simpson continued.
The American Trucking Associations’ estimate of the current driver shortfall is approximately 80,000. But the organization sees that number moving to more than 160,000 by 2030.
“It’s the most difficult driver market I’ve ever seen,” Leathers said. “Has it stabilized at very difficult? That seems to be the case. So it’s staying very difficult but it doesn’t seem to be worsening.”
There's more at the link.
I understand the problem with truck and trailer production is the non-availability of critical parts, which are also stuck somewhere in the supply chain. I know a couple of major hauliers in this area have started to remanufacture older trucks and trailers, spending up to 30% of the cost of a new unit to keep old ones in service for a few more years. They'd prefer to replace them, of course, but since that's not possible in today's market - particularly when bigger, wealthier competitors are outbidding them for the available stock - they're doing the best they can.
The driver shortage will be made worse, at least in the short term, by new and more stringent training requirements that take effect in February 2022. This is a positive development for driver and road safety, but it'll mean getting new drivers certified and into productive work will take longer and cost more. I understand existing drivers, particularly older ones, are getting more than fed up with the pressures they're facing from shippers and customers. No matter how much money they're getting, they're voting with their feet and deciding that the stress and tension of the job isn't worth it any more. It's hard to blame them.
If there are any transport operators or truck drivers among our readers, I'm sure we'd love to hear from them in Comments. How are they finding the present situation?
Peter
A more pressing problem may be the shortage of DEF. Apparently, a key ingredient in DEF, urea, is also the reason for the shortage of fertilizer.
ReplyDeleteT Town, we call that "Adblue" down here and the other day the lying media mentioned a shortage for us as well (you know it's bad if the MSM mention it). However! Trucks should still run without Adblue, the electronics will de-rate the motor. So maybe you have 550Hp with Adblue, you get 400Hp without.
ReplyDeleteI'm just making the HP numbers up because I have no idea and it's probably specific truck to truck, but I have a friend who runs his own trucking business and I first found out about Adblue from him years ago. He explained the de-rating without Adblue to me then.
I quit OTR in 2014 , the B.S. caused by CVSA 2010 was more than I can tolerate (even a perfect level 1,2 or 3 inspection gets you points )(the real reason cvsa 2010 is to trap guys at whatever carrier they're at because your not hireable cdl wise elsewhere. I still have my 1995 truck and it works great . Greta can kiss my ass too .
ReplyDeletelemmiwinks......just use water in dpf tank , it won't stink as much ether .below freezing the system doesn't function anyway .
lemmiwinks, it isn't a matter of whether the trucks can run without it, it is that they may not be allowed to run in California, and possibly other states, without it due to environmental laws. Part of our supply shortage already hinges on California's strict environmental laws that prevent the older trucks that don't require DEF from operating in that state.
ReplyDeleteI'm a plant Manager for a company in North Carolina. We get shipments of a powder from our mother company in Japan. The freight cost to ship it across the country from Oakland to here has doubled twice in the last 5 months. It now costs $21k more per shipment than it did 5 months ago. That's for 2 truckloads of product. It's not a port issue at all so far, it's a trucking issue. Needless to say, we're raising prices on our products.
ReplyDeleteThe derating without DEF is much more extreme than that - a friend noted that when he ran out of DEF his 2019 truck was limited to a maximum of 45mph. When he managed to get some, the system refused to reset, and he had to go through a complicated series of steps to make it run normally once more.
ReplyDeleteOh, and DEF is 32.5% urea, versus the 1% of urea in urine. Pissing in the DEF tank will not work!
We've seen replacement truck parts go from being a few days or weeks away to literally months.
ReplyDeleteMore inspection/weigh stations are opening for """safety""" (read: $), mandatory electronic logging went into effect a few years back, wages haven't gone up that much for most (especially given inflation), cops and other drivers see you as a paycheck (tickets and insurance), and not nearly enough parking. Had I not found something local and steady, I may have done like so many others and switched to something else.
I just got my Class A CDL last week, and started driving yesterday. Very glad I got it done before the February cutoff, and the pay is hella good.
ReplyDeleteRead/skimmed the article. My question: If finding enough school bus drivers now (the local bus companies all have in-house training) is a problem, what happens with these new rules?
ReplyDeleteYou could pretty much describes the nursing burnout and shortages as more ever stringent restrictions are imposed at a time when the system itself was maxed out with hospitals in overflow.
ReplyDelete