Expect delays and price hikes
The trucking industry is facing a shortage of qualified drivers, with more items to deliver than ever before. Trucks move about 70% of all freight in this country, and shipments and costs of produce and packaged good have already been impacted.
“Shippers and wholesale suppliers, they're certainly going to feel the hit," said Rod Suarez, an economic analyst with the industry trade group American Trucking Associations (ATA). “The consumer won't really notice. It will be more of a bottom line for companies.”
In 2017, the ATA predicted the trucking industry would experience the highest level of driver shortfall, and by 2026 the ATA estimates the shortage could swell to over 174,000 drivers.
“Across all segments, freight costs have escalated as trucking capacity has tightened nationwide,” Thomas P. Hayes, president and CEO of Tyson Foods, said during the company’s fourth-quarter earnings call in February. “We expect these costs to continue to rise as carriers compete for drivers and new federal regulations come into play. We estimate this will add more than $200 million to our costs this year. At the same time, marketplace dynamics are driving wages higher, pushing up our labor cost. These additional costs are included in our outlook. However, we're assuming we'll recover the majority through pricing.”
Sysco, Hersey, Campbell Soup, McCormick & Co. and J.M. Smucker also mentioned freight costs concerns during recent earnings calls.
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