Logistics Management - June 2010

Quarterly Transportation MARKET UPDATE
A special supplement to
Truckload
There are solid indications
that the days of excess
supply are over. According
to analysts and leading
TL executives, all signs
point to a revival of TL
rates due to rising costs,
tighter capacity, increased
regulation, and the overall
economic recovery in the
industrial and retail sectors.
Flipped
on its
head
By John D. Schulz, Contributing Editor
Truckload (TL) is the engine that drives the trucking
industry in this country. With more than
$300 billion in revenue, it’s the largest sector in the
$645 billion trucking market. It’s also historically
been the most innovative and responsive to shipper
demands over the years.
Because of TL’s inherent efficiencies—where freight
is moved non-stop from Point A to Point B without the
cost of terminals and dockworkers—truckload is where
the action is in trucking. And for the last three years
or so, it’s where the bargain rates have been as carriers
slashed rates merely to stay in business at a time when
volumes were off as much as 30 percent in some cases.
But those days appear to be over, as carrier executives
say it’s time to refocus on profitability.
For shippers, that most likely will mean reaching
into the corporate pocketbook a little deeper in order to
assure adequate capacity for the remainder of the year.
“It’s going to be a challenging sell, but it’s going
to be a necessity to stay in business, says Pat Quinn,
president and co-chairman of U.S. Xpress, the nation’s
fourth largest TL carrier with $1.33 billion in revenue
last year. “Those (shippers) who give us the money will
get the space in the trucks. Those who don’t will have
to find somebody else. It’s the basic law of economics—supply
and demand.”
Logistics Management • June 2010 61S