The industry is expected to see an increase in demand for specialized services and an overall increase in shipping volume. Jan 13, 2023. until the market becomes more favorable. Over the last decade, the e-commerce industry has witnessed a tremendous boom. Trucking companies need to be aware of the expenses Low-clearance technologies help fleets avoid costly accidents, Groups argue Biden decarbonization Blueprint undoes emission strides. The trucking industry accounts for $800 billion in gross revenue each year, making it a major contributor to our countrys overall economic growth and vitality. to help simplify their complex operations and make them more efficient and streamlined. The rising fuel costs have always been a concern for companies operating their doors due to the harsh market conditions prevalent in this industry. and one that is sure to be seized in the coming months and years. continues to decline, trucking companies will have to lower their prices even In particular, COVID-19 lockdowns in China will continue to impact the flow of imports while the shortage of critical semiconductors for automobiles remains an issue. Trucks are now being equipped with advanced fleet technology, improving the vehicles overall efficiency and functionality. With this kind of system installed on all vehicles, drivers have access to real-time information about their deliveries and routes from anywhere. Serving Car & Truck Fleet Management Professionals, Serving EV Intenders & Professionals In Commercial & Public Fleets, Serving Corporate, Executive, & Financial Managers Of Large Commercial Fleets, Serving Leaders In Fleet Mobility & Emerging Technology, Serving Public Sector Fleet Professionals, Serving Medium & Heavy Duty Commercial Truck Professionals, Serving Transit Bus, Private Motorcoach, & Passenger Rail Professionals, Serving School & Pupil Transportation Fleet Professionals, Serving Vocational & Service Fleet Professionals. If youre interested in start your own trucking businessthen there are many ways to do so as well! The average trucking rates are based on DAT iQ's $137 billion database of actual freight payments. 5: Turbocharging digital and technology innovation. As most rural areas have been converted into urban landscapes, it has become convenient for trucks to traverse through parts of the country they werent able to reach before. New housing starts is a key statistic to watch when it comes to freight volumes. Reach out to us today. At Labworks USA, we are more than just a Consortium. [Related: Gap between contract, spot rates narrowing], "One thing we have seen," he said, "credit card debt has increased substantially but not quite yet where it was in 2019. Fortunately, port congestion is finally easing. 2: EVs usher in a generational shift in mobility. See the trend shown from the three most common answers for where respondents thought rates would be at the beginning of each of the following quarters, Many carriers have been battered by high fuel prices and equipment costs in 2022. What trends will we see in 2023? Well, today, were going to look at some things that are likely to happen in the trucking industry over the next few years. Many trucking companies have been switching from diesel powered trucks to natural gas powered ones due to their lower emissions and fewer maintenance costs. further in order to stay afloat. With inventories still higher than the pre-pandemic trend line, he said, it raises concern, as we expect consumption to fall off over the next two or three quarters.. Transflo has a wide range of products that support carriers, brokers, and factoring companies in finding optimal efficiency among all stakeholders across the supply chain. have remained constant for several years. Net income among the largest publicly traded carriers, Vieth said, is expected to be up 15% this year versus last, with the group generating $3.5 billion in cash. In 2023, there is concern over lower housing starts, leading to lower freight volumes. This is compared to fixing a leaking pipe, once the pipe has been fixed only one part of the problem is addressed the remaining recovery transitions to water damage. Most importantly, while US consumers are still shopping in times of high inflation, there are still mismatches between what shoppers want and what is available to purchase., OEMs continue to face part shortages going into 2023, especially in the microchip industries. renowned trucking companies have remained steadfast, and the industry has only The industry has been impacted by many things and work has changed as a Spot rates have already hit their lowest point, said 16.96% of respondents, or about one in six. "Trucking demand today is higher than it was in 2018, but that's only half the picture," Miller noted. Get an on-demand recording and hear from economists and industry experts discuss the market forces, business conditions and supply chain issues that will impact carrier operations in 2023. Get to know Trans Plus and what drives us. If youre like us, youre anxious to see what 2023 has in store for the trucking industry. types of mergers that trucking companies are likely to pursue: One option for mitigating the effects of a challenging market is to merge Subscribe to our mailing list and stay updated with the latest in trucking technologies. The industrial production outlook for 2023 is essentially flat. We go beyond our usual From 2014 to 2017, the trucking industry's revenue hovered right between $676.2 and $726.4 billion and grew to $796.7 billion in 2018. And when it comes to keeping insurance premiums as low as possible, there are safety technologies that can help. The shortage of movement of goods has resulted in a drop in As the trucking market continues to decline, many trucking companies will be Technology has majorly transformed several industries with its rapid growth and adoption, and the trucking industry is not exempted from this. A market flip is expected to emerge in 2023. In 2023 we will continue to deal with ongoing industry challenges, but experts do expect progress. This unprecedented congestion prompted intervention from the Biden administration to help reduce the strain. Trucking companies are going to have to find ways to offset these rising costs. Avery Vise, VP, Trucking, said the theme of the webinar was uncertainty, and that is all about the economy.. to bring new opportunities and challenges for businesses and individuals alike, As of July 1, FTR was forecasting 307,400 new Class 8 vehicles built this year, followed by 340,000 in 2022 and 350,000 in 2023. Vieth noted labor is still in short supply, and probably needs to see sustained sub-200,000 job growth to relieve wage inflation. Looking ahead. While it had its challenges, it was a year that we all came together to learn, to grow and to get ready to do it all over again. developments. and we can only wait in anticipation to see what the coming year has in store. Most importantly, the morale of the industry itself at the independent level is just not good right now." 2023 Trucking Forecast. several software programs to help make their operations more efficient and Production Location Changes All ELDs in use to meet the mandate must be certified by one of the testing bodies. There is speculation that governmental funding for infrastructure improvements could offset the weakening housing starts. It has been estimated that over 80% of all goods moved across the United States are transported by trucks, which makes up for approximately 70 percent of all freight carried by rail or water. Only then there will be a possibility of a significant change to the pricing regarding the services that trucking companies offer. While many trucking companies are shutting down due to the harsh market conditions, some are willing to merge with other companies to withstand the market. After facing supply issues for months already, carriers will continue to be challenged by limited semiconductor, tire, and other component supplies. The 2023 General Freight Trucking Industry Report contains historical and forecasted statistics used by leading private equity firms and consultants. An end-to-end TMS software tailored to your needs. FTR's State of Freight webinar on Jan. 12 explored the economic indicators that most affect the freight market as well as trucking-specific numbers and offered FTRs outlook for the year. With such major and unexpected changes, what does the future hold for trucking? Trucking is one of the most important transportation industries in the world. the future of trucking. All rights reserved. Luckily, TransPlus' Fleet Manager software provides ELD HOS integrations to ensure compliance with the mandate, while providing useful, real-time HOS data to your dispatching team.. As a result, the trucking industry hauled 72.2% of all freight transported in the United States in 2021, equating to 10.93 billion tons. In 2023 we will continue to deal with ongoing industry challenges, but experts do expect progress. transported, as well as because they need to communicate this information to Its an essential part of the economy, and its estimated that over 70% of all goods in the United States are transported by truck at some point. As the market began to decline, trucking companies started to charge less Based on reports from the American Trucking Association (ATA) economists as well as researchers at the Americas Commercial Transportation (ACT) Research Company . California reconsidering its unfriendly autonomous trucking regs? What was once a The trucking industry is one of the. This has been a big topic in trucking, as fuel efficiency is a key concern for trucking companies. Just how bad will it be? is the question. the board. To view or add a comment, sign in, Pacific Scientific Energetic Materials Company. However, the adoption of advanced technology and the incorporation of data analytics into fleet operations can turn the tables for the industry. From fuel prices to maintenance to driver pay, finding ways to reduce your cost-per-mile with the use of technology can help your trucking business navigate these uncertain economic times. Despite all the struggles and challenges the industry had to go through, many experts are still optimistic about 2023 and believe the industry is likely to experience a major incline due to new technological developments. Market sizes from 2018 to 2028 reflect industry trends and growth patterns. Changes in Pricing 7) 7. There is no sign that there will be any further extensions this time around. All of the tools to keep you safe and compliant from Load to Last Mile., Full Broker Suite with Digital Load Offers, Visibility & Document Management, Adopt ways to reduce expenses and avoid inflated borrowing costs if possible, Emphasize scalability to allow rapid adjustment to market fluctuations, Embrace new technology that improves operational efficiency, Connect to a network of trusted partners and vendors. The outlook for the goods transport economy is weaker than overall GDP he said, with a couple of negative quarters expected this year. The current tally is now back to more manageable levels, and the backlog has reduced 35% off recent highs. January 12, 2023 Transflo Intelligent Automation leverages AI and machine learning to capture and process valuable, real-time freight data to automate every day tasks. These investments can help you to reduce fuel surcharges, plan fuel-efficient routes, and monitor driver behavior that could negatively impact fuel usage. And while there are signs that a return to normalcy is on the horizon, it looks like we're in for another year of volatility. Overcapacity - freight companies began . And the rising costs of insurance are having an impact as well. By clicking Yes Proceed you will now be responsible for all of your FMCSA Clearinghouse responsibilities. Due to the closure of these companies, thousands of truckers are left unemployed. The industry's strong fundamentals have FreightWaves researchers suggesting that it may spark a multiyear upcycle for trucking. sector. This has led to increased costs and delays for companies, as well as a strain on the overall economy. Truck Rentals: Be sure to plan out for busy seasons in 2023, as availability of rental trucks will continue to be a challenge. December numbers show the CPI rose 6.5% in December from a year earlier, which was down from 7.1% in November. Even though this is not a new concept, drone deliveries are becoming part of major . incurred when making these new additions. Aerodynamics is the study of how objects move through the air and how they interact with the air. Powerful add-ons to help you scale and grow with confidence. likely to turn around and experience a gradual increase due to new One of the biggest challenges facing the trucking industry in 2023 is the ongoing shortage of truck drivers. Despite the unpredictable economic situation and the ongoing driver and semi-truck shortage, the industry experts are still hopeful that the trucking industry will emerge stronger in the coming year and they believe the future of the trucking industry is bright. In 2023 we will continue to deal with ongoing industry challenges, but experts do expect progress. Trend No. The industry experienced a decline in 2019, however, many believe that it is likely to turn around and experience a gradual increase due to new developments. goods from one place to another. for fear of not being able to get work at all. During a recent CCJ webinar sponsored by Bestpass,Jason Miller, associate professor of supply chain management at Michigan State University, andACT ResearchPresident and Senior AnalystKenny Viethdiscussed the market forces, business conditions and supply chain issues that will impact carrier operations in 2023. what the industry had in the past. Another way trucking companies are trying to offset these costs is by becoming more fuel-efficient. For more details on 2023 trends, check out theFleet Owner Outlook Articlepublished in January 2023. Starting in October we have started to lose a pretty substantial number. Preliminary numbers for last month show the industry lost more carriers in December than in any month on record with the exception of December of 05, he said. "Using Class 8 as an example, record orders in September followed by . In this high inflation environment, thats a positive sign, because its believed that rapid job growth can contribute to inflation. It is likely another interest rate spike is coming; therefore, loans and credit lines will likely be considered a last resort in Q1 of 2023 (with the belief of refinancing as a prelude to any new contracts signed in the foreseeable future). that surfaced last year quite likely run parallel with the ones expected to rise in the upcoming year. In fact, nearly every good consumed in the U.S. is put on a truck at some point. It added that 56% of the trucking fleets that responded to their survey implemented three or more new safety technologies.. production operations to newer locations, in order to meet the ever-growing We also may expect to see a higher emphasis on the creation of electric semi-trucks to avoid the high fuel prices. This trend could be very regionalized. The US trucking industry is one of the most important sectors in the American economy. attacks or slurs, hate speech, demonstrably false information, excessive profanity, or that are thinly veiled promotions for a product, will not be approved. There is no doubt that these changes will be By 2023, the total freight tonnage is expected to grow by 21 percent, and revenue for the freight transportation industry is expected to rise 59 percent, according to the Ontario Trucking Association (OTA). One factor in that is a weak import environment, because imports fuel much of the consumer side of the economy. Consumer spending is still high, Miller said, noting retailers brought in holiday season inventories earlier than normal, which blunted what historically is a peak freight season. According to the U.S. Freight Transportation Forecast to 2022 by the American Trucking Association, freight tonnage in the U.S. will grow 24 percent by the end of 2022. In particular, carriers looking to replace aging fleets will be hampered by supply constraints. the point where people now prefer to shop online than in-store. Tools such as road-facing cameras, speed governors and forward collision warnings can all help mitigate rising insurance premiums. This provides hope as we move through 2023. Were not likely to be in anything we would consider a recession for the next couple of quarters, and even then, its unlikely to be anything more than mild.. The trend of shifting to a new production location is witnessed across the entire transportation and logistics industry and is not exclusive only to the trucking industry. As far as mergers are concerned, trucking companies are likely to explore two options: the first option is to merge with an existing trucking company and pool the resources together to stay afloat in the business. But, this does not necessarily equate to what happens to capacity. ", While credit card debt is up,Miller said there has not been a corresponding increase in delinquencies, adding, "we're actuallystill below pre-COVID levels, as hard as that is to believe. They can also use voice commands with a hands-free operation for even greater convenience! trucks themselves. Spot rates have been in freefall since January 2022, and while contract rates are still elevated, they are beginning to follow a similar trendline. If youre looking to learn more about the mandate and how to prepare, check out our full breakdown here., Getting your fleet ready for ELD compliance is crucial if you want to avoid disruptions to your operations and fines. The ever-evolving landscape of technology has had a profound and positive 4: Making America's transportation network more resilient. The American Trucking Associations (ATA) Management & Conference Exhibition saw a panel discussion led by the ATA's Chief Economist Bob Costello. Currently, at least three thousand truckers are unemployed due to the We are in an environment where overall freight levels are not likely to change a whole lot over the year., Asked about why we still hear talk of a driver shortage in light of this capacity shift, Vise said, I believe what a lot of people call a driver shortage is, frankly, just the churn thats always there. Maintenance: While fleets with in-house maintenance facilities will continue to struggle with the growing technician shortage, there is always the option to consider bringing in the expertise of an OEM dealership to manage your shop. Advanced Clean Transportation (ACT) Expo 2023 Agenda Announced. Regarding trucking the same risks will take effect, particularly concerning interest rates business loans, auto loans for new trucks, and credit rates are all factors that are going to make 2023 difficult for fleets and factors as they continue operations into the new year. Lets get you prepared for the challenges to come with our predictions for the top 4 trends in trucking in 2023.. The trucking industry is going to see an increase in mergers in 2023 as companies attempt to pool resources together to weather the storm. In todays age, trucking companies can opt for alternative fuel trucks or even electric trucks to help reduce fuel costs and save some costs being spent on fuel. how it operates and the types of trucks making their way to marketplaces. Thats probably going to translate into a negative environment.. Today, trucking companies can opt to go in for alternative fuel trucks or The second one is to merge with a company from a different sector to expand its business and services. In fact, theyre likely to continue rising in the next few years. forced to merge with other companies in order to survive. ET comments The internet has become an integral part of our lives, and the trucking industry is not exempt from this phenomenon. A Market Flip 6) 6. Urbanization 10) 10. A market flip is expected to emerge in the coming year. The trucking industry is going to see an increase in mergers in 2023 as companies attempt to pool resources together to weather the storm. Despite these challenges, the trucking industry is expected to continue to play a vital role in the global economy in 2023. In fact, there has been a steady rise in e-commerce over recent years. 2021 has been the first year since 2018 that the industry has grown, as there was a steep decline in 2020. American. According to the latest Short-Term Energy Outlook from the Department of Energys Energy Information Administration, average retail diesel prices will remain at more than $5 per gallon through 2022 and into early 2023. It takes out services and adds imports as a positive, whereas in federal GDP calculations imports are counted as a negative. All of these developments will likely alter how the trucking industry will Unless there is a large spike in the retail industry and a momentous increase in freight flow, this trend is not likely to change in the coming year. Something went wrong while submitting the form. Annual car sales worldwide 2010-2022, with a forecast for 2023 Number of cars sold in the U.S. 1951-2021 . Thats not good news for freight transportation and volume, because this metric seems to outperform actual loadings to some degree, Vise said. An intriguing theory was raised by FleetOwner, which stated that the U.S. economy may be able to balance a recession with the growth of the economy and stability of the job market however, Freight may see a slowdown (Fisher, 2022). We kind of have to redefine what a recession is, he said. As we draw closer to the end of 2022, we cant help but wonder what the upcoming year holds for the trucking industry. Trucking Industry Forecast For 2023. owner October 13, 2022 Last month it was 261,000, bringing the rolling three-month average to 289,000. The slide in 2022 back to normal from a record-setting 2021 was painful for many carriers. Using her 8+ years of working experience, she writes for trucking industry experts who are always looking for better technological solutions to their problems. total freight tonnage will grow from an estimated 15.1 billion tons in 2021 to 19.3 billion tons in 2032a 28% increase; while truck's share of the freight tonnage will slowly decline from 72.2% in 2021 to 71% in 2032overall volumes will grow across all segments of the industry: truckload, less-than-truckload and private carrier. one of the bigger factors when accounting for trucking companies expenses. The next year should be fruitful for businesses that can stay head of potential challenges. E-commerce has been on the rise for several years now, and it doesnt seem to be slowing down anytime soon. The past few years have been extremely challenging for the US trucking industry. Over the past few . Economists estimate that the net loss from trade tariffs would come out to approximately $16.8 billion. to traverse through parts of the country that were previously inaccessible. In recent years, the production locations for some of the world's most It contributes to the country's economic success and its global dominance. But with payroll employment in trucking currently appearing to be peaking, he said, many of those drivers probably wont be absorbed into the employee-driver population. There are two main However, echoing many of Miller's positive indicators, Vieth said it could be "the best recession ever," addingthat a strong U.S. balance sheet sets up a mild recession in 2023 with recovery in 2024 and 2025.