For the past couple years, freight has been moderate to say the least, in comparison to the estimated post-recession boom that was supposed to have taken place. Although freight has once again been moving and in fact steadily increasing in volume, conditions have not indicated the steep rise in volume and lack of capacity that was predicted…until maybe now! From what I am seeing, we may have a “Perfect Storm” of conditions for a boom in trucking like we haven’t seen since years prior to the last recession.
There are several key indicators that I see making things a bit more profitable for us drivers out there. One of which is the recent increase in freight volumes for all sectors, which has taken a firm hold on the industry over the past couple weeks. One report boasted that we were now seeing freight levels not seen since 2014! I noticed a slight surge in rates due to the annual roadcheck, but have not seen any sign of these increased rates going away. Rates in the week that followed, for my trucks at least, brought even more of an increase.
One more ingredient to this “storm” is the affordability of used trucks for owner-operators looking to upgrade their worn-out, maintenance-laden older equipment. I have seen reports of used truck prices being down as much as 20%, largely due in part to fleets cycling out large numbers of 3 to 4 year old trucks for newer replacements. This allows upgrading owner operators the benefits of getting a fleet-maintained unit at a price far less than he or she would have paid as recent as just last year!
The other two factors that are contributing to my prediction are low fuel prices and the improving state of the economy. We are seeing some of the cheapest diesel prices we have seen in a while, especially here in California. With this comes reduced operational costs, on top of the possibility of a cheaper truck note mentioned earlier. As we take advantage of these lower fuel prices, people all around are also starting to spend again, boosting our economy. Homes are selling, new home construction is up, people are traveling and vacationing again, which all leads to consumer goods needing to be replenished again by those of us who keep those wheels turnin’!.
If all of these things continue to improve from their current positions, we could see one heck of a boom on the horizon as owner operators. With the implementation of the ELD mandate soon coming to light, this could be just one more ingredient to the mix to continue to move trucking forward on its current path. Either way I am thrilled to be along for the ride and will take advantage of the current conditions until “the wheels fall off”, so-to-speak!