I just returned from Orlando, Florida where I represented Accruit at the national conference of the American Trucking Association (ATA). Over 500 of the industry’s top trucking companies were in attendance as we discussed current issues and the future of the trucking industry. Among the many marquee business speakers who presented were Bob Costello-Nationally recognized economist, Stuart Varney-Host of Fox Business News, and Jeb Bush-former Florida Governor and potential 2016 Presidential candidate.
Trucking has been hit hard by many external factors that will remain problematic for the next several years including:
- A very slow economic recovery combined with rising costs and stagnant freight rates that is squeezing profitability for nearly every trucking company in America.
- Drastic and unpredictable swings in the price of fuel.
- An already dire driver shortage that will only become more exacerbated with the recovery of the construction industry where many will find higher paying jobs with more time at home.
- An already strained litany of Legislative obstacles and roadblocks including hours of service, Obamacare, CSA pitfalls, and many other rules and regulations that constrain productivity.
- An overall truck fleet age that is older than at any time in the last 50 years.
But the news wasn’t all bad for America’s freight haulers. Industry leaders at the ATA conference identified several imminent improvements:
- Dramatic advances and improvements in the design and delivery of alternative fuel driven power units.
- Solid growth in the national “infrastructure” for delivering alternative fuels nationwide.
- Improvement in the nation’s homebuilding industry.
- Slight easing of credit and capital.
- Continued improvement in safety and vehicle accident statistics across the board.
- Continued gains in safety and productivity from improved tractor design and fuel economy.
- Improving dialogue with the nation’s shippers around “wait time” problems and expenses.
On the tax front—trucking companies are facing 2014 without Bonus Depreciation which means that they will be facing much higher tax liabilities on their sold used tractors and trailers. This will create a huge demand for 1031 Like-Kind Exchange services as an alternative business strategy for reducing these taxes. Being able to re-route these tax dollars onto the purchase of new equipment will provide trucking companies with more purchasing power for new equipment at a time when current fleet age is at an all-time high.
The ATA Conference had it all, but most importantly, what I got from the conference was the exciting recognition of the indomitable spirit and optimism demonstrated by some of the great owners and leaders in this critical American industry.
The trucking industry SHIPS America, and whatever it is you have, need, or will eventually want—chances are it will be brought to you via a trucker someplace. As the saying goes—“As goes trucking, goes America!”