Trucking Industry Adapts Post-COVID-19
Source:fleet owner
From:Taiwan Trade Center Chicago
Update Time:2020/07/30
The trucking industry has been hit hard by the COVID-19 outbreak, with surges in demand for trucking conflicted by stay-at-home mandates and quarantine. The Council of Supply Chain Management Professionals (CSCMP) have stated that the motor carriers industry needs to adapt to the world post-COVID-19 or risk their elimination from the market. However, for the companies that can hold out until the outbreak eases up, they are in line for fewer competition and a high demand for their services which they will finally be able to fully provide.
This information and more were released in an annual report that gives a preview of the American logistics sector and supply chains during the pandemic. It states that 2019 had been a notably strong year for logistics, and this led into 2020 before the pandemic. Recovery from the economic crash, necessary for the industry to survive, could take the form of a sharp upturn after the market hits the bottom or a slow curved incline. Because they know the market will get worse before better, reports stay that cutbacks and bankruptcy by some companies are anticipated in the meantime.
In fact, almost 700 motor carriers in the market have gone out of business since the start of 2019 as demand has fallen. Specifically, higher tariffs and insurance costs in addition to a rising salary for drivers are likely the cause. Now that the COVID-19 pandemic has hit, this is likely to not only continue but worsen. The silver lining is that companies who can stay afloat during the economic recession will be able to soar in profits once other companies have dropped out and demand rises when the economy reopens. For 2020, companies are now required to edit their projected profits.
Before the pandemic, supply chains in this market had been commended. Now, though, a complete shift in how they are created and how they function is required for businesses to continue. In addition, companies that prioritize technological advancements to increase efficiency are likely to come out on top once the recession is over. Even during the pandemic, companies that spend less on fuel and shipping costs due to technology will save more and stay afloat longer.
Overall, COVID-19 has influenced an industry to make a complete 180 in how it operates. An industry that was once stable and confident, commended for its production, is now struggling and must prepare to make drastic changes to continue on.
Source:https://www.fleetowner.com/fleet-management/article/21134905/carriers-need-to-change-to-adapt-to-covid-challenges-logistics-report