Failing Trucking Companies on the Decline

A recent report by a leading trucking industry research company indicated that the rate of trucking companies that have failed has declined. The report stated that those companies that have survived the recession will be more profitable in the future. The Avondale Partners feel this is a result of well-managed and well-capitalized companies weathering the economic storm that has persisted over the last several years.

Indicators in early 2012 have given those in the trucking industry hope that the worst is over. So far, the first quarter of 2012 has only seen about 160 trucking companies fail compared to the 295 that failed in the same quarter of 2011. These statistics show that the companies that made it through the lean period are now positioned to be more profitable as the economy continues to improve.

By weathering the earlier recession, the companies have also been able to withstand the impacts of the recent rise in the cost of diesel that has topped $4 much better than they did back in 2008. The stronger companies that have emerged from the recession will be in much better shape to endure the current rise in diesel prices.

Another impact of the recession that has increased the rates that truckers can charge is the tightening of truckload capacity. Fewer trucks are now on the road limiting the amount of available loads to haul cargo. Capacities has been impacted by a number of factors including the bankruptcies, merging of carrier companies, reduction in fleets due to age and the shortage of drivers.

As the economy worsened and companies went out of business, many truck drivers left the industry to find work elsewhere. Driver retention and pay issues have played a major role in the status of the industry today. Qualified drivers are at a premium and many carriers will have to position themselves to find, train and keep the best drivers if they want to be competitive in the business. Drivers are also impacted by some of the new regulations in the industry such as the Compliance Safety Accountability (CSA) program. This has caused many drivers to drop out of the business. Other matters such as the use of on-board recorders that monitor driver behavior have also had an affect.

Many of these factors are also driving up the price of stocks of companies in the industry. With fewer companies on the financial markets, the remaining ones can draw premium stock prices because of gains earned due to the tighter capacity and increased rates that are charged for the delivery of goods.

The research company and other analysts in the business foresee brighter days ahead if current trends are an indicator. The decline in the failure of trucking companies should benefit the remaining companies, qualified drivers and investors in the financial markets. It should also give a boost to the overall economy.

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Comments

hey brian. almost my ernite family has a felony. its sad but true. I am in your same situation in florida. However my mom and brother live in georgia, my mom has been there for almost 11 years and has different charges on her background includin a felony for writing worthless checks, went to prison came home wrote more and got on probation for it. She works in atlanta on peachtree as a debt collector and has been there for about 5 years. My brother has drug charges robbery charges and more has been to prison as well and he has only been out of prison for about a year and moved to georgia. He now has his liscense, works in a publix wearhouse, and as a cashier at subway. At the rate things are going down here im about tocome back to georgia and work at the same mc donalds i was at before i left they are willing to take me back as soon as get there. they are in norcross. i dont know where you live in ga. but there are places willing to hire felons. Not saying you have not been looking i just thought i would give you some good places to check out and a litte bit of hope that it is not all bad up there. good lick

As a graduate from trucking school in 2010, I have not been given the opportunity to be a trucker, every trucking company wants a driver to have three to six months otr, how can I begin a trucker career if not given the opportunity?

count your blessing.  In this enviornment of freight depreciation and economic tumoil the trucking industry has been able to choose their canidates with great scrutini.  This will not always be the case as the economony recovers and drivers return to other employment opputunities.  The large companies lose 8 out of ten drivers that they employ, mainly due to their abuse of drivers.  You are blessed that you are not one of the abused.  Wait, and they will be begging for your application.

As an ex-inmate, I've been able to achieve a class A license, but since my release, trucking companies won't hire me. Trucking companies advertise they need good truckers, but fail to hire the ex-inmate who wishes to be productive in society. This needs to change because many drivers who have a past record can be a productive driver if trucking companies are willing to offer employment to ex-inmates who have a class A license.

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