1. Trucking today & Tomorrow
Jim Mele
Editor Emeritus
Fleet Owner

2. A Few Questions Help me focus on what’s most important to you
Are you shippers, fleet operators, both or none of the above?
How many have own truck fleet?
Depend on backhauls to generate some revenue?
How many have a dedicated or contract carrier?
How many use 3PL to manage/purchase freight?
How many use brokers?
How many manage freight in-house?

3. Trucking Today Good news and bad depending on your perspective
Rates rising rapidly, capacity tightening
How high, how fast?
DAT’s NA Freight Index up 9% over August for record high since 2000
Spot freight loads up 74% YOY
Largest YOY growth in truckload demand since 2010
Contract rates rising for first time in 18 months
DAT – digital load board and industry source of freight activity
FTR Assoc. source for contract rates

4. Trucking Today cont. Flatbed numbers:
Load activity up 3% over Aug. Had declined in Sept. for last 6 years
Spot rates up18% YOY at $2.26/mi., highest monthly average since 2014
Increases continued into first week of Oct., up $.05/mi. vs. last week in Sept.
41.8 loads available per truck in Sept., up 227% YOY

5. Why? General economy Harvey and Irma – long-range impact for flatbed
Fleet’s aren’t adding capacity
Unfortunately …
Van TL flattening after hurricanes, but flatbed involved in rebuilding, so demand will remain elevated for at least a few quarters.

6. Tomorrow – Capacity Pressures
ELDs coming home to roost
Confusion over implementation, but now coming Dec. 18
60% haven't switched yet
FMCSA won't put out of service until April, but will fine
Fleets that have warn of big productivity drop 5-7%
Fleets restructuring business models in response
494 mi. one-day, 1000 mi. two day YES, mi. NO
Detention time now really important and quantifiable
There will be good and bad loads, customers
Many will exit industry -- not one O/O adopted ELD in Sept. survey
Electronic Logging Devices – replacing paper records of HOS used since 1930s
Paper logs easy to manipulate, create “extra” hours
Adopting ELDs not simple process – takes time to understand impact on business

7. Tomorrow - Capacity Pressures cont.
Drivers at a premium again
ELD pressure on earnings just as turnover returns
New entrants – economy, training, testing. Immigration wild card
Fleets can’t add capacity without new drivers
Pay will increase, so will rates
Drivers paid by mile in TL sector, so if they lose miles to HOS enforcement, lowers pay
New drivers – rapid adoption of automated transmissions – almost 100% on new truck orders
CDL training and testing rules a high barrier and expensive to train.
Economy improving means more competition for workers in jobs with better lifestyle

8. Big Changes Ahead Connectivity, automation and energy diversity
Advanced safety systems, GHG come at high cost
Driver demographics – work environment, lifestyle
Data tailoring equipment and operations
Rate of change over next 10 years in trucking higher than experienced over the last 100 years
Connectivity means more data about trucks, drivers and CUSTOMERS to optimize fleet operations
Automation further out than public media thinks, but still coming
Energy diversity – powertrain for trucks – electric, natural gas, hydrogen, ? All chosen for specific applications
Advanced safety systems – trucking in safety crosshairs – fatalities up again last year. Success of ABS, ESC now leading to blind spot warning, auto emergency braking, other systems that work but carry cost
GHG standards for HD trucks still coming

9. Q & A
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