Consultants Forum Advertise
Subscribe
Area Development Magazine Current Issue

  • Free for qualified executives and consultants to industry

  • Receive quarterly issues of Area Development Magazine and special market report and directory issues

Subscribe Now
Renew

Area Development

Trucking Industry Challenges Impact Costs, Productivity

Trucking companies are facing numerous regulations, an aging workforce and tightening conditions for hauling capacity, all of which will have a significant impact on corporate supply chains.

Q4 2016
Over-the-road trucking companies face numerous regulations that raise operational and administrative costs, and reduce productivity. Trucking profits are also very economy-dependent — according to freight transportation forecasting firm FTR, economic indicators are “soft” for the trucking sector this year and reflect tightening conditions for hauling capacity that will likely carry into 2017.

Some industry experts are further concerned that regulations such as Compliance, Safety, and Accountability (CSA), Electronic Logging Device (ELD), and Hours of Service (HOS) “have the potential to worsen the capacity crisis, increase transportation rates, and harm carrier productivity at a time when carriers expect financial difficulty,” reports PLS Logistics. These rules could bring an additional negative impact to profitability in the 10 to 18 percent range.

“With new e-log regulations and other laws impacting the trucking industry coming into effect in 2017, we expect these regulations will have a significant impact on corporate supply chains,” says Richard H. Thompson, international director for Supply Chain & Logistics Solutions at JLL. “They will eventually drive up trucking costs, which means higher transportation costs for corporate shippers.”

One of the most controversial regulations is HOS, which limits the average workweek to 70 hours, driving time to 11 hours, and on-duty hours to 14 — which impacts how operators move their trailers. “The clock now begins running at the beginning of the day, and does not pause,” says Christopher Steele, COO and North America president for Investment Consulting Associates. “It used to be that when a driver approached the facility, he or she could stop the clock while the trailer was being unloaded. Now, the clock does not stop. As a result, facility operators now need to increase parking/storage for trailers so that a driver can drop a trailer off, hook onto a new trailer, and go without losing much precious time.” With new e-log regulations and other laws impacting the trucking industry coming into effect in 2017, we expect these regulations will have a significant impact on corporate supply chains...they will eventually drive up trucking costs, which means higher transportation costs for corporate shippers. Richard H. Thompson, international director for Supply Chain & Logistics Solutions at JLL

Drivers Needed
Another major challenge for the trucking industry is a retiring workforce. With fewer truckers entering the profession, and the average age of a trucker being the mid-50s, these new regulations may exacerbate the lack of drivers.

“With the serious driver shortage we are currently facing, and the capacity crunch, it’s extremely important to keep drivers moving so they make money and get home as often as possible,” states PLS Logistics. “HOS rules could…not only increase operating costs for carriers, it could raise shipping prices for shippers and keep new drivers from entering the industry.”

“These regulations will make it even more difficult to find, recruit, and retain drivers,” agrees Thompson. “And, if the economy starts to turn up more rapidly, it creates serious issues for trucking capacity and drivers.”

Intermodal Intervenes
A practical alternative to these operational challenges for truckers is expanded intermodal. Intermodal freight options will likely be used more as trucking becomes more costly.

“Intermodal operations will continue to grow,” says Grant M. Miller, vice president in the Charlotte office for Colliers International. “Just this year CSX announced a new intermodal facility in Rocky Mount, N.C., and the South Carolina Ports Authority announced a new inland port in Dillon. I think we will continue to see more of these type of operations to help alleviate the dependence on trucking.”

Recent Project Announcements

Area Development Magazine Q2 2026

Current Issue | Q2 2026

Exclusive Research

Magazine

Issues
Area Development Magazine Q2 2026
Q2 2026

Receive quarterly issues of Area Development Magazine at no charge for qualified executives and consultants to industry.