The trucking industry is witnessing tremendous changes as it relates to the manner in which it operates and the kind of trucks it makes its way into the market spaces.
During the year, the industry in the United States has seen its ups and downs. All of these have affected the overall production and development of this space. Over time, various factors have impacted the way the industry functions, and various elements have changed the way work gets done within this industry. Looking ahead to the rest of 2022, we're going to take a look at a few trends that might affect our industry.
Industries worldwide are experiencing a rapid increase in technological advancement due to the incredible use of technology that is now occurring.
Here are some trends in trucking that are likely to emerge for the rest of 2022 (and beyond) within the industry.
1. Carrier Bankruptcy
Over the past few years, several large and small shipping companies have closed their doors because of harsh market conditions prevalent within the industry. At least 3,000 truck drivers are currently out of work because of the closing down of these trucking companies, leading to an increasing number of unemployed people.
Another reason is the shortage of transportation. Retail companies are moving fewer goods from one place to the next, which means there's less work for trucking companies. This has caused them to go bankrupt, resulting in a drop in their profitability. The trend is unlikely to change in the coming years unless there is a large increase in the retail industry and a significant increase in freight flow rates.
2. Improvement Of Technology
Technology has improved the way we live our lives in many ways, and the transportation industry is no exception. Technology has improved across the board for trucking companies, from their corporate offices to the very trucks themselves. More companies are beginning to use software programs to help them run their operations more efficient and streamlined.
Trucks that were once just used for transporting goods are now being equipped with advanced technology that makes them smarter than ever before. More trucks are incorporating smart technology to improve their functionality. Tracking orders is also something that has made many trucking companies have to install technology that helps them keep tabs on the goods that are being transported, and also because these companies have to convey this information back to their customers who buy their products.
3. Higher Number of Mergers
Many companies in this industry are going bankrupt as a result of the tough market conditions. However, some companies choose to go down the alternative path and merge with other companies instead. Many trucking companies will likely shift their focus towards autonomous trucks by 2022 if the market doesn’t improve and if trucking firms don't have any other alternatives to turn to.
There are two main ways that trucking companies may go about merging. The first step is to merge with an already established trucking company so that you can pool your resources together and withstand the competition. It allows companies to keep operating and maybe even expand into new territories. Trucking companies can also choose to merge with a company from a different sector to expand their range of services. This would help them stay afloat until they reach a more favorable point in the market.
4. Shift In Production Locations
For several years now, the production locations for many of the world's largest trucking companies have remained relatively stable and have only grown with time. However, companies are beginning to look at newer locations in order to be able to conduct production operations and to meet the demand for existing trucks.
When it comes to moving, and saving fuel costs, Texas, Illinois, and Ohio are among the states that companies are likely to move to.
For Reefer smokers, California and Illinois are preferred locations.
Flatbed trucks are mainly being produced in Texas and Pennsylvania and are expected to continue there in 2022.
Shifting to a new location is no longer exclusive to the trucking sector and is something that is happening across the entire transportation and logistics industry.
5. A Market Flip
While the trucking sector may not be in the best position right now, there are some people who are enthusiastic and optimistic for 2022 and all that it will bring. As a result of the decline that the online marketing industry experienced in 2019, many believe that this industry is likely to turn back around and experience a gradual rise as a result of the newer developments that are coming to the industry.
A market flip is predicted to emerge in 2022 and could really help the entire industry and save some companies from going bankrupt if the current market conditions don't change.
6. Changes in Pricing
Truck drivers currently earn far less than most Americans, so much so that they earn far less than their counterparts who drive for companies like Uber and Lyft. During 2019, the prices that truckers were paid declined significantly due to the lack of available jobs. Trucking companies started charging less because they were afraid of not being able to find any work at all.
Driver pay increase have been a concern in the past years resulting to driver shortage. Of course, this is due to the change in pricing of trucking companies.
Professional truck drivers experience this from different supply chains too. Considering the freight industry, freight volumes, freight demand, and especially the freight rates? These supply chain concerns affect and have a real impact too to driver pay.
One of the effects of this is the shortage of jobs due to driver wages. Regardless of the driver type, they have the same sentiments.
By 2022, the prices that trucking companies charge their clients may be changing either for the better or for the worse. If the market continues its downward trend, trucking companies will likely have to cut their prices even further.
If the industry experiences a positive growth rate, the prices can increase back to where they were before the decline began. Either way, there's no doubt that there will be significant changes to the prices for trucking services offered by companies.
Remember, the trucking business can still be profitable.
7. Influence of E-commerce
Over the past few decades, the e-commerce market has grown tremendously, and today we live in a world where consumers prefer to buy products online rather than in stores. The wide variety available on the internet and the fast fashion that come with it have helped this industry grow and have made it one of the most successful ones today.
However, it is vital to note that the eCommerce industry cannot function without the assistance of the trucking industry This industry relies heavily on truckers to transport its goods from one place to the next, so improvements in e-commerce will improve the trucking industry. Given the fact that the e-commerce industry will likely continue growing in the future, one can hope that the trucking industry will also experience some positive growth.
The trucking business growth is dependent on the current trends in the trucking industry and other supply chain issues. This 2022, let's keep updated more ourselves with all the innovations in Trucking. This will keep us thriving more in the trucking industry.
Looking at the trends above, it might already be overwhelming for you to handle DOT safety and compliance concerns. With that, Labworks USA can lessen the burden for you. Feel free to reach out to us today.Back to Blogs