Loaded and Rolling: Driver pay and parking prioritized

Many trucking companies are still using legacy systems such as IBM Power Systems AS400 and making a transition to a new platform is plagued by overcoming the accrued tech debt from short-term software fixes before one can even begin integration from older systems. Additionally, according to research from Advanced, 74% of software legacy system modernization projects fail. AI Fleet is in an advantageous position to build its core software systems from the ground up, without all the baggage from older legacy systems. 

This advantage also allows AI Fleet to automate many planning and dispatch-related tasks, giving fleet managers more time to focus on driver happiness and asset utilization. This driver experience may be the starting point for a driver-focused business model, compared to traditional enterprise carrier strategies of finding large-volume customers and adjusting driver recruiting as a numbers-based and not people-focused metric. 

ATRI on truck parking shortage and fleets’ and drivers’ differing priorities

A study by the American Transportation Research Institute with more than 2,500 respondents showed stark differences in the most important topics for trucking management and drivers. Driver compensation and truck parking tied for first place among commercial drivers, while the driver shortage remained the most important concern for motor carriers. What is striking is the truck parking topic did not even make the top 10 list. Key highlights are below: 

• Rebecca Brewster, president and CEO of ATRI, said, “The lack of truck parking is a big personal issue for me,” she said, pointing out that many of the conference attendees likely drove past trucks parked on the shoulders and ramps of highways for lack of parking. “It should not be occurring. This is an untenable position drivers are faced with.”
• Previous ATRI research has indicated that 44% of drivers found truck parking much harder or somewhat harder than in years past. Brewster attributed this in part to public rest areas closing during the COVID pandemic.
• Brewster recalled a 2016 study in which ATRI “actually had drivers keep a good old-fashioned diary of everything about their truck parking,” wherein drivers reported a troubling frequency of unauthorized undesignated parking. The diaries also found drivers spending an average of 56 minutes a day looking for parking. 

THE BIG PICTURE:

A key takeaway is drivers spent an average of 56 minutes per day searching for parking, per parking diaries from 600 commercial drivers who participated in ATRI research back in 2016. From my experience, this remains a hugely underreported issue and major challenge for most drivers. Fleets that address parking fears will also address turnover issues, as a happy driver is one who knows where he or she will shut down for the night.

Market update: Logistics Managers’ Index expanded 80 basis points from October to 73.4%

Lack of transportation and warehouse capacity caused costs to soar in November, according to recent data from the Logistics Managers’ Index. The LMI is a diffusion index with anything above 50% and expansion and below 50% a contraction. FreightWaves’ Todd Maiden has an excellent summary of the report below: 

• “Overall growth has now been over 70.0 — a level we would classify as significant expansion — 10 months in a row and 13 of the last 15,” the report read. The outliers were mid-60% readings in December and January, which were more of “a function of inventories being sold off” during the 2020 fourth quarter.
• “The shortages of retail goods this holiday season have not been as severe as they were predicted to be,” the report continued. “This seems to have been largely achieved by firms spending heavily on warehousing and transportation to get goods downstream.”
• “The expectations of continued transportation price increases for the next 12 months remain very strong,” the report stated. The forward expectation for transportation rates came back at 84.3%, up 130 bps sequentially.

FreightWaves TRAC lane spotlight: Kansas City to Fort Worth

Lane highlights are courtesy of Zach Strickland’s SONAR sightings.

Overview: Capacity is likely to tighten further as the Headhaul Index increases 26% week-over-week.

HIGHLIGHTS

• Kansas City, Missouri, outbound tender volumes are up 44% w/w, signaling an increase in demand for truckload capacity.
• The Headhaul Index in Kansas City is up 26% w/w, signaling a growing imbalance between inbound and outbound truckload volumes.
• Kansas City outbound tender rejections are up 2.9% w/w, signaling that capacity is likely already tightening.

Carriers: Stay firm on your rates for your outbound Kansas City loads. There is significant upward pressure coming from the 44% w/w increase in outbound volumes, coupled with the 26% increase in the Headhaul Index w/w. With outbound tender rejections over 9% higher than the national average, you have pricing power in your favor.

The routing guide: Links from around the web

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