Countless industries are suffering in President Joe Biden’s America, and the trucking industry is bracing to become the victim.
According to Freight Waves, a company that monitors trucking industry data, Chris Tucker of Winchester, Kentucky, owns a truck brokerage called Full Coverage Freight.
He recently needed some hot tubs moved from Seattle to Wisconsin, so he posted the job on a load board for his “network of small truckers.”
The initial rate for the job was less than $2.00 a mile, and Tucker figured he would not be able to find a trucker who would complete it for that price. He expected drivers would negotiate with his company to get the rate up to about $2.50 a mile.
Instead, Tucker’s office received “dozens of phone calls and hundreds of texts” asking for the job, Freight Waves reported. All of them were willing to complete it at the exact rate Tucker offered.
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There are currently more truckers than there are jobs for them to do, meaning each job is worth less money than it was in recent years.
In a private Facebook group with trucking professionals, Tucker predicted this would lead to a “Great Purge” in the industry, Freight Waves reported.
Tucker said he was particularly worried about small truckers who joined the trucking industry while demand was at an all-time high during the COVID-19 pandemic.
“We saw this developing 18 months ago,” Tucker told Freight Waves. “We could support this artificial introduction of all these carriers just because of all this activity going on.”
Should Biden take action to address this problem?
While consumer demand is still high, supply chain woes at the factory level and skyrocketing diesel prices have made jobs less available and more expensive to complete.
“I don’t think there’s enough freight out there to justify their existence anymore,” Tucker said.
Data from Freight Waves suggested this “Great Purge” has already begun. In May 2022, about 9,300 “trucking authorities” — documents from the Federal Motor Carriers Safety Administration that permit a company to truck goods commercially — were revoked.
That is an increase of over 4,500 from the number of revocations in April 2022. Even throwing out about 4,000 revocations that may have been due to a failure to file a required form, according to Freight Waves, net revocations were still at a record high.
Avery Vise, vice president of trucking for FTR Transportation Intelligence, told Freight Waves that most of the trucking businesses that are closing are small operations with as little as one driver. He predicted these drivers may join a larger trucking fleet instead of getting out of trucking altogether.
Some truckers have already taken this step, while others have leased their trucks out to one of these larger trucking fleets. Yet according to Freight Waves, even that opportunity may be closing.
Prices for used trucks are dropping precipitously, Freight Waves reported in May, and the number of truckers working in nonsupervisory roles for larger fleets hit a record high in April. Vise said he is watching to see whether the industry decides it has too many drivers.
Vise said he thought the industry would avoid a recession since manufacturing backups will eventually clear and customers are still purchasing at a high rate. He simply sees a shift from smaller trucking companies to an industry dominated by larger fleets.
Thom Albrecht, chief financial officer of the transportation insurance agency Reliance Partners, disagreed. He said running a trucking company is getting too expensive to be viable.
In any case, small truckers are clearly suffering in America, and it is yet another problem Biden and his administration have failed to quell.
