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Independent Truckers * USA - Current Transportation Capacity Glut, is Forcing MI Truckers out of Business
Move will Eventually Help Clear the Market, Restore Carrier Pricing Power; what a Difference Two Years Makes
Springboro,OH,USA -Supply Chain Digest -March 3, 2008: -- While the large carriers have, as a result, managed to almost totally shift the fuel cost risk to shippers, independent operators have seen it go the other way, as rising, un-recouped fuel costs take away huge chunks of their cash flow and profit... The large carriers are weathering the storm, albeit at lower profitability, shile many smaller firms and independent truckers are in trouble, with many going bankrupt or leaving the industry... By most estimates, independents represent about 9% of the 3.4 million over-the-road drivers... In general, independent trucks, who generally either work as sub-contractors for larger firms or gain work through transportation brokers, lack the clout or sophistication to add hefty fuel surcharges to their mileage charges to recoup (or even profit from) rising fuel costs, as most larger freight companies do... We’ve been through this before. Between 2000 and 2002, a quarter million trucks – about 10 percent of the US total - were repossessed nationwide. That ultimately contributed to a shortage of capacity when the economy later rebounded, leading to a supply demand balance strongly in favor of carriers for a few years, from 2004 through early 2006...
Labels: independent truckers
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