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Looking Ahead: The Future of Growth for the Trucking Industry

 

2016 has been a year of incredible ups and downs in a lot of different ways, not the least of all being for the trucking industry. New regulations cracking down on Hours of Service as well as Greenhouse gas emissions are causing a number of trucking companies to begin tightening their belts, especially when faced with the considerable softened demand. This, combined with the considerable rate of driver turnover the industry is facing and the fact that the median age of truckers are quickly approaching retirement, it’s safe to say that the industry has been facing something closely resembling a crisis.

While these issues are nothing new for the trucking industry, there’s also a considerable amount of concern being issued due to the recent U.S. election in which Donald Trump unexpectedly came out on top. However, while the situation might seem dire, there is a light at the end of the tunnel. The trucking industry is about to experience a much-needed period of growth, and with the new politicians taking their offices, there is a promise that an overhaul in the transportation infrastructure is on the horizon.

Growth by the Numbers

Despite the fact that pipelines are gaining a growing share of the market, trucking transportation is looking it higher numbers of growth, even more than the other modes of transportation such as rail and sea. A missive released by the American Trucking Association a few weeks ago highlights what the trucking industry can look forward to.

“As we continue to see growth in the overall economy, particularly due to manufacturing, consumer spending and international trade, we will also see increases in the amount of freight moved in America’s trucks,” according to Bob Costello, an ATA Chief Economist.

According to the ATA’s latest U.S. Freight Transportation Forecast report freight tonnage is expected to grow upwards of 35% over the course of the next decade, marking a slightly smaller growth of 27% for the trucking industry. This means that truckload volumes are projected to grow at a rate of 2% annually over the next five years and drop to a rate of 1.6% growth after that until 2027. Less-than-truckload volumes, on the other hand, will see a slightly higher rate of growth at 3% until 2022 and 2.8% between 2023 and 2027.

“No one can know exactly what the future holds for our economy and industry, but Freight Forecast has proven to be a valuable tool for everyone from industry leaders to government policy makers,” said says the optimistic Chris Spear, the CEO and President of the ATA. “We do know as long as our economy continues to grow, trucks will continue to move the vast majority of America’s goods, underscoring our industry’s critical role in our country’s future.” 

A Political Change Up

Looking at the result of the election, there will be a lot of new faces coming into office. The question is, what does this mean for the trucking industry? Fortunately, there is a lot of optimism behind President Elect Trump.

“During the campaign, [Trump] highlighted the need to create jobs and recognized that improving our nation’s infrastructure is critical to strengthening the economy,” Spear said. “As the industry that moves nearly 70 percent of our nation’s freight and is a key economic driver, we look forward to working with President-elect Trump on a host of issues, including long-term, sustainable infrastructure funding, tax reform and fair and free trade.”

A recent article from Trucks highlights a number of the other changes in office that we’ll be seeing in the coming months, as well as some insight into what Trump has planned for the country. While campaigning, Trump made some rather audacious proposals even going so far as to eliminating the EPA (Environmental Protection Agency). While his stance has softened quite a bit since he won the election, there is still the consideration of loosening some of the regulations which would make life easier for the trucking industry.

“Trump will be good for the economy.  He plans to reverse President Obama’s decision and build the Keystone Pipeline and relax the grip the EPA has had over us. I understand regulations are needed, but the last eight years have brought a culture of excessive regulation which has stifled growth and kept this economy limping along,” said a fleet owner who preferred to remain anonymous.

Additionally, Trump also has a strong focus on fixing and repairing the roads and general infrastructure of the United States, which would come as a tremendous boon for truckers and the logistics industry as a whole. However, only time will tell as to what measures President Trump actually effects and what the future holds for the trucking industry.

 

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