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Lack of Drivers – Good Price Higher

March 22, 2019 by admin Leave a Comment

The cost of moving household goods from trucking to maritime shipping are rising. Therefore, those goods are getting pricier. As Procter and Gamble spokeswoman Jennifer Corso explained that U.S. trucking costs are up 25% in comparing with the year before.

“A key driver of this has been increased demand for trucking and a driver shortage. These increased costs obviously put pressure on margins, hence our continued focus on productivity throughout the company to help offset these costs, as well as rising commodity costs” Corso added.

Truck driver on a highway

What seems to be the issue?

The main problem can be explained by the simple correlation between supply and demand. In particular, trucking has been squeezed for years between an aging workforce of drivers and increased tonnage demands.

President of Dayton trucking company Jet Express and American Trucking Associations’ past chairman, Kevin Burch, described this situation as a “perfect storm.” He said that all those commodities such as truckloads of toilet issue or truckloads of paper towels are going to cost more. “It’s reality. It’s going to touch everything.”

The significance of the trucking industry

Director of safety for Xenia trucking company Homerun Inc. Tom Milby explained the vast significance of the trucking industry in our everyday lives. “The trucking industry brings everything that you see. Your food, your cars.” Everything is transported either directly to consumers or to retail outlets — grocery stores, malls, brick-and-mortar outlets.

Kevin Burch said that the electronic logging requirements that went into effect in late 2017 are controlling hours of service for trucking. In addition, the number of truck drivers is down while shipping tonnage is up. “You’re going to need more people to handle the same amount of freight,” Burch added. “Well guess what? We have an economy that’s going like crazy right now, so that just compounds it.”

Big companies suffer the most

A long-time distributor of McDonald’s, Martin-Bower Co. is is raising delivery fees. That way, menu prices are affected. Tom Milby said that his company lacks the number of drivers – they have 200 but could use up to 300 drivers. “It’s just a struggle for us to get to that number. With the baby boomers retiring, millennials don’t want to get into the trucking business.”

Milby added that his company is looking for local and out-of-town drivers. Good drivers can always expect to make good money. “I’ve got drivers making $80,000 a year.” Aside from household goods, gas taxes in Ohio could also rise.

Trucking is not alone in pushing costs up

Recently, Ohio Governor Mike DeWine has unveiled an executive budget for fiscal years 2020-21 in which he has proposed an 18-cent-per gallon gas tax hike that would generate about $1.2 billion a year for roads and bridges.

Also, in January 2020, the International Maritime Organization is expected to impose new limits on sulfur pollution from ships on international waters. Stated imposition will certainly impact freight rates as well.

Filed Under: Journal

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