The tight supply of drivers as well as high fuel costs continue to concern fleets as holiday freight rolls.
“As we enter into the busiest time of year for motor carriers, industry issues are taking shape in a way that will significantly impact customer-carrier relationships in 2006,” said Jim Latta, vp for West Chester, PA-based LTL carrier A. Duie Pyle. “The industry shortage of quality drivers will continue throughout 2006 [and] this ongoing problem is constraining capacity creation and precipitating a diminishment in the utility of resources.”
John Anderson, CEO for real estate and trucking conglomerate Patriot Transportation, Jacksonville, FL, said low driver availability is constraining his operation’s ability to get more business. Patriot’s transportation segment revenues topped $29.6 million in the fourth quarter of 2005, an increase of $3.8 million over the same quarter last year – with revenue miles up 2.4% and revenue earned per mile increasing 5.7%, reflecting better pricing for its services. Still, things could have been better if drivers weren’t so scarce, he said.
“Favorable freight hauling demands within [our] trucking operations will continue to be challenged by industry-wide, tight driver availability,” Anderson noted. For the year, he said Patriot’s revenues jumped to $112.8 million, an increase of 13.5% over 2004, with revenue miles up 2.3% and revenues per mile up over 5.1% compared to last year.
“Driver and independent contractor availability continues to be a serious concern for … the industry,” said Kirk Thompson, president & CEO of Lowell, AR-based truckload carrier J.B. Hunt. “We continue to see no signs of fundamental improvement in driver or independent contractor availability for the foreseeable future. We do not anticipate significant capacity additions in the truckload marketplace in the near term.”
Driver scarcity is becoming even more apparent as freight volumes reach record levels in many parts of the country. The Port of Los Angeles, for example, said it just set a new record in monthly container volumes during October of this year – exceeding 700,000 TEUs (twenty-foot equivalent container units) for a 10.08% gain over October 2004. The month with the second highest container volumes to date was July 2004, when a total of 676,399 TEUs passed through the Port.
October’s numbers edge the Port’s TEU count up to a 5.18% increase for the 2005/2006 fiscal year (which began in July 2005) and 1.35% over the first 10-month period of the 2004 calendar year, noted Bruce Seaton, interim executive director at the Port of Los Angeles.
Meanwhile, the Port of New Orleans is reporting it’s being hit with a severe driver shortage—in part because of the national driver shortage but mainly because of the port truckers displaced by Hurricane Katrina.
The port has restored operations to about half of pre-Katrina levels. But it has only about 150 truckers working in the Port compared to the pre-Katrina level of 1,000, according to a Port news release.