114157479 | Wissanu Sirapat | Dreamstime
Shipping Port Supply Chain 114157479 Wissanu Sirapat Dreamstime

Of supply chain, aging trucks, parts availability, and private equity

Nov. 4, 2021
Everything that's happening in the global economy is compounding an already bad situation. Unfortunately, there's no magical solution. As a worldwide effort, every aspect of the supply chain needs to be analyzed to determine how to eliminate pinch points.

There is so much going on in the world that is affecting trucking, and I thought it might be helpful to have it all down in one place to gain a better understanding of the entire picture.

Most of the news is focused on supply chain disruption and material shortages—most critically microchips—that is plaguing the trucking industry as well as impacting the overall economy.

Interestingly, even manufacturers do not have good answers about when the situation will be resolved and when they will be able to deliver orders.

We do know that COVID-19 continues to play a role in these delays as suppliers in other countries continue to contend with shutdowns in response to additional outbreaks. Currently, this is delaying the supply chain by four to six weeks, which in turn delays production schedules at vehicle manufacturing plants.

The current supply chain crisis has caused some people to wonder why we are not sourcing more products and components domestically. The answer is we do not currently have enough suppliers in the U.S. to meet demand. Even if we try to shorten the supply chain at this point, manufacturing is a business that cannot turn on a dime. R&D and tooling are involved in starting new plants, and it takes time to develop long-term sourcing contracts and supplier relationships.

While much of the focus on the current supply chain crisis is on whole goods, the reality is that capital equipment is not the only area being impacted. We also are seeing issues with tires, oils/lubes, steel, aluminum—you name it—and there is likely a supply chain issue.

The problem is exacerbated by regulations at the ports in California and restrictions on what trucks may enter the ports. Also, there are staffing issues at the ports from drivers to warehouse workers to longshoremen. Ports are open 24/7 and yet only 60% of the available pickup slots are being utilized. Wait times at ports are excessively long, making it an even less attractive option for the limited equipment and smaller number of drivers. Why wait at the port and carry one load a day when you could work in other areas and carry multiple loads during your allowed hours of service?

The supply chain issues that have pushed truck order deliveries out into 2023 mean that fleets are having to rely on older equipment to ensure they can deliver goods. This increased burden on older equipment results in more maintenance and repair of those vehicles. However, those repairs also are being delayed because parts are not available. As I mentioned, the supply chain issues are impacting everything, and repair parts are not excluded.

Everything that is happening is compounding an already bad situation. Unfortunately, there is no magical solution that will make this problem go away any time soon.

While all this is going on, the age-old supply-and-demand rationale has made trucking companies attractive targets for investors. Private equity firms are looking to buy these companies and consolidate operations and, in many cases, this is making it more difficult for smaller fleets to compete.

My hope is that we will be able to come up with some real, concrete solutions by seeing the complexity and depth of the issues the trucking industry is facing. Regulations that impede efficiency and limit the flow of goods into the market need to be reevaluated to see if there is a better way. The flow of containers in and out of ports should be much quicker.

As a global team effort, we need to analyze every aspect of the supply chain and determine where we have pinch points and how we can quickly eliminate them.

Patrick Gaskins, SVP of Corcentric Fleet Solutions, oversees both sales and operations for the company's fleet offerings. Gaskins joined the company in 2010, bringing more than 30 years of experience as a financial services professional in the transportation industry. He leads a team that works with a supply base of more than 160 manufacturers to help the country’s largest fleets manage all aspects of their fleet operations and fleet-related spend.

About the Author

Patrick Gaskins | Senior vice president, Fleet Solutions

Patrick Gaskins is a financial services professional serving the transportation industry for over 30 years. Gaskins earned his BBA in Finance from the University of Miami, FL in 1989, and received his CTP certification from the National Private Truck Council in 2002. He has held positions with GE Capital, TCF Equipment Finance, and various small independent lessors. 

He began his career with Corcentric in 2010 as Vice President of Financial Services, was promoted to Senior Vice President of Sales and Operations, and is now taking the role of Senior Vice President, Fleet Solutions.  In his new role he will lead Corcentric’s Captial Equipment Solutions, Fleet Procurement, Supply Management, and Remarketing teams. Gaskins will bring to the Fleet practice his expertise in developing data driven solutions to complex transportation transactions, driving efficiencies, and reducing expenses for Corcentric’s customers.

The Fleet Solutions practice leverages technology and the purchasing power of over 1,700 member fleets operating approximately 800,000 assets to provide its members with access to cost effective national account purchasing programs, fleet financing, asset management, and remarketing services.

Voice your opinion!

To join the conversation, and become an exclusive member of FleetOwner, create an account today!

Sponsored Recommendations

Report: The 2024 State of Heavy-Duty Repair

From capitalizing on the latest revenue trends to implementing strategic financial planning—this report serves as a roadmap for navigating the challenges and opportunities of ...

Fleet Industry Benchmarks: How does your fleet stack up?

Discover how your fleet compares to industry benchmarks and gain insights from a 2024 Benchmarking Report on maintenance spend, turnaround time, and more. Join us to identify ...

Build a Tolling Program to Manage Toll Fees and Risks

Fleets looking to effectively manage their operational costs should consider their tolling costs. Download the PrePass whitepaper, “Build a Tolling Program to Manage Toll Fees...

Reducing CSA Violations & Increasing Safety With Advanced Trailer Telematics

Keep the roads safer with advanced trailer telematics. In this whitepaper, see how you can gain insights that lead to increased safety and reduced roadside incidents—keeping drivers...