Trucking must get smarter

Nov. 1, 2006
The business models trucking used in the past are no longer viable, according to trucking executives and other industry experts

The business models trucking used in the past are no longer viable, according to trucking executives and other industry experts participating in the McLeod Software users conference held in Birmingham, AL.

According to Bill Graves, president & CEO of the American Trucking Assns., trucks hauled over 10-billion tons of freight in 2005. Tonnage is projected to grow 31% to 14 billion by 2014.

Profiting from that demand is the tricky part. The price tag for heavy trucks is rising steadily due to tighter emission rules, said Graves.

Fuel costs are exploding as well. Trucking is on track to spend $102.3 billion on fuel this year, up from $87.7 billion in 2005. The switch to ultra-low-sulfur diesel (ULSD) in 2007 is expected to add $1 billion more to that bill, Graves pointed out. On top of that is a growing shortage of truck drivers, a deficit projected to hit 120,000 in the long-haul truckload sector by 2014.

Those projections mean carriers must find money to increase driver pay and benefits, while at the same time cover higher equipment and fuel costs, said Tom McLeod, president of McLeod Software. That means minimizing costs while generating more revenue per mile.

Technology will play a bigger role in solving those equations, McLeod added. “You'll need to be able to track fuel consumption, track fuel surcharge billing, monitor dispatch for on-time delivery, etc.,” he explained. “Finding ways to make life simpler and more profitable for drivers is going to be a major effort as well.”

About the Author

Sean Kilcarr | Editor in Chief

Sean reports and comments on trends affecting the many different strata of the trucking industry -- light and medium duty fleets up through over-the-road truckload, less-than-truckload, and private fleet operations Also be sure to visit Sean's blog Trucks at Work where he offers analysis on a variety of different topics inside the trucking industry.

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