The trucking industry is definitely having a moment.
In just the past few days, an industry executive spoke from the White House about the positive effects federal tax reform has had on his business, and a noted industry economist predicted that trucking likely has several good years ahead of it before the threat of an economic downturn might rear its ugly head. Plus, sales of new trucks just keep rising.
Good times, indeed.
Demand for carriers’ services is soaring at a time when already tight capacity is under pressure due to the electronic logging device mandate. We’re living the moment when the industry will figure out how that mandate will affect trucking for the long term.
We’re also living the moment when companies are crunching the numbers on Congress’ sweeping tax reform measure, and many like what they see. Count Werner CEO Derek Leathers among them. He joined other business leaders April 12 in a Rose Garden ceremony to outline how the package is helping their businesses. Leathers brought along a driver, Quinton Ward, who also took a turn on the podium to thank President Donald Trump.
Drivers such as Ward are in high demand, and that will remain the case in the near term, as economic momentum will propel the industry for at least the next few years, noted industry economist Noel Perry at a Transportation Intermediaries Association conference in California.
It’s another good moment to be living. But it can’t last forever.
Beyond that near-term horizon, Perry cautioned that the industry could in a few years settle down, which would ease pressure on capacity and driver demand.
Tell that to the motor carriers who are buying new trucks at a breakneck pace; March sales jumped 31% over year-ago levels, while sales are up nearly 37% for the first quarter of 2018. It’s a sustained trend, and one that suggests carriers are anticipating a future in which they’ll need updated fleets to meet customer demand. After all, no one buys a new truck if they’re expecting a downturn.
In the months ahead, a lot of this will shake out. The industry will adjust to the ELD mandate, the longer-term effects of tax reform will become clearer and we’ll see how much longer this truck-buying spree will last. Someday, perhaps we will look back on this era and mark the time when so much was going on all at once.
It will be quite a moment.