Why can’t I get my truck moved? Where are all the drivers? These are the questions many shippers are asking. Freight tonnage is on the increase this year and capacity is getting tighter. The driver shortage has now come back with a vengeance and shows zero sign of improving anytime soon.
According to American Trucking Associations Chief Economist Bob Costello, The turnover rate at truckload carriers surged in the second quarter of the year, a sign that the market for drivers is quickly tightening. According to ATA’s quarterly report, the turnover rate at large truckload carriers jumped 16 percentage points to 90% – the highest it has been since the final quarter of 2015. The 16-point increase is the largest quarterly jump since the fourth quarter of 2010. At smaller carriers, fleets with less than $30 million in annual revenue, the turnover rate swelled by 19 percentage points to 85%, the highest it has been since the first quarter of 2016.
What should shippers expect? All of this turnover has fleets scrambling to find drivers to meet customer demands. This becomes an issue of simple economics. Driver demand is high and capacity is low creating an expected increase in freight rates. In addition, hurricane relief efforts have disrupted the freight industry with FEMA sucking up capacity in the spot quote market, which is also driving freight rates much higher. Shippers can expect rates to continue to climb as freight demands grow and the driver shortage continues to get worse.
The same economics are happening in the drive away industry as well. “We are now in environment where there are more trucks to move than drivers to move them”, says Scott Shacklett, CEO of Team Drive Away. He goes on to say “Most driveaway drivers are independent contractors. They understand that they are in high demand, which is giving the drivers a chance to demand higher pay and allowing them to be choosier about loads they are taking. They only want the highest paying loads.” The industry as a whole has seen a 16% increase in overall driver costs.
Truck Dealers, OEMS, fleets, auctions, and other entities that utilize drive away companies to move trucks must educate their customers on current capacity restraints and work to set good expectations for delivery. Communication and the right expectations will keep from relationships becoming strained.
Partnering with the right drive away company will be absolutely critical to ensure your trucks get moved while capacity continues to get tighter. Here are some things to ask your service provider to make sure you have the right company to work with.
- Do they have a solid driver recruiting strategy?– Understanding that your drive away company has a solid strategy to bring in more drivers is critical in knowing whether or not they can handle your future business. Another good question to ask is: How many drivers are they hiring per week?
- What is your driver turnover? – If you are using a carrier that is losing drivers every week instead of gaining ground, you could be putting your loads at even more risk to getting moved. If they do not know what their turnover is, that could be a sign the carrier you are using is not organized.
- Is safety a focus? Safety scores – While safety is a big deal to most shippers and carriers, this is something often overlooked in the drive away industry. Understandably, organizations that move trucks just want their trucks moved timely. However, if safety is being overlooked by your current carrier or if their safety scores are too high, it could result in major delays. The DOT is always looking at carriers with bad safety scores. If you are moving trucks with a carrier with a poor safety record, your loads could be highly scrutinized by DOT. Not to mention the potential other problems that could arise from not being focused on safety.
The driver shortage is something that will continue to plague transportation for years to come. In order to put your self in the best position to make sure your trucks get to your customers, it will make sense for you to look a little deeper into your drive away company to make sure are you putting your trust in the right place.
About Team Drive Away:
Team Drive–Away is the trucking industry’s leading provider of commercial vehicle transport and delivery. Whether you are buying trucks, selling trucks, or making terminal moves, let Team Drive-Away coordinate moving your assets. Thousands of fleets, dealers, and other asset managers, have already discovered significant cost savings and improved efficiency through Team Drive-Away.
We look forward to answering any questions or explaining how we continue to grow our driver base faster than any other drive away company and walking you through our approach to how we achieve our industry leading safety scores