How is Your Fleet Handling the Recession?

Apr 01, 2009

As the ripple effects of the current recession continue, businesses are being forced to look at not just the impact, but at how things will be run in the future.

At this years Truckload Carriers Association conference in Orlando, survival was the one word on most participants minds, but as many leaders have stated over the last few months, there is also an opportunity to implement new ideas and knowledge from past mistakes.

In recent years when the economy seemed to be on steady ground, trucking companies were more willing to spend money on expanding their fleets to meet anticipated demands.

Today the trend is shifting toward being more conservative with estimations and looking to increase profit by raising rates alone.

As a result, equipment used by trucking companies is also beginning to have an effect on the industry across the board.  Carriers in a position to, or who have the need to add capacity are avoiding buying new equipment or opting for used equipment, which is driving prices down across the board.

The carriers who are not doing as well are then finding themselves owing more on equipment that they’re still paying on than it is actually worth, making it tough to get out of the business even if they wanted to.

The news isn’t all bad though…a report from Transport Capital Partners released findings from the Orlando conference says that while tonnage is off, some carriers are starting to see a boost that might imply that at least the recession has hit bottom.

With that, some of the healthier carriers are looking to merge or acquire companies that can expand their business, or are looking at companies that they feel can be fixed.

The result may be that when the economy does turn around, we may have a “capacity crunch” without enough tonnage capabilities to meet demand.

These days though, that sounds like a pretty nice problem to have.