As the economy reopens and the United States attempts to move past the Covid-19 pandemic, the driver shortage in the trucking industry is becoming very apparent. From keeping stores stocked to moving materials for infrastructure projects, and even keeping fuel flowing at the pumps, truckers are in high demand from every sector. To prevent supply chains throughout the country from reaching dire straits, the FMCSA is doing everything it can to relax certain federal guidelines and keep trucks rolling.
Chip Shortages and New Drivers
There is currently a huge shortage in the tech industry, specifically with microprocessors. This normally would have very little impact on the trucking industry, except now ELD manufacturers are unable to supply carriers with the devices they need to legally operate. The FMCSA is temporarily waiving ELD requirements on new vehicles so trucking companies can keep hauling shipments.
CDL Waivers Extended to August 31st
The pandemic had everyone in lockdown, which made it impossible for truckers to get new licenses or to renew existing ones. The gap in bureaucracy caused by Covid-19 threatened to create an even larger driver shortage than already exists. As such, the FMCSA is extending CDL waivers until August 31, 2021.The FMCSA is also issuing an exemption for drivers who are transporting essential supplies and commodities, such as:
Medical supplies and equipment
Community medical supplies, including gloves, masks, and hand sanitizer
Food and paper products
Livestock and feed
Extended HoS for Energy Haulers
The cyberattack on the Colonial Pipeline, which forced the FMCSA to make an amendment to its disaster declaration. To prevent a spike in fuel prices or shortages, the FMCSA extended hours of service for truckers that were hauling diesel, jet fuel, gasoline, and other petroleum products. The amendment extended to 10 states, including New York, Louisiana, Texas, and others. The extension lasted until June 18, 2021 and helped to prevent transportation and commerce from grinding to a halt, and to keep price gouging at the pump to a minimum.
The DRIVE-Safe Act
The Developing Responsible Individuals for a Vibrant Economy (DRIVE) Safe Act aimed to recruit young drivers into the trucking industry to fill in gaps in the workforce, and also to replenish the driver pool as older truckers entered retirement. Initially, professionals in the trucking industry, insurance companies, and lawmakers were very apprehensive about letting young drivers handle Class-8 vehicles. However, statistics proved the naysayers wrong. Truckers in the 18-25 category only account to 6% of fatal accidents, while the highest group consists of drivers in the 46-55 age range. The DRIVE-Safe Act has gone a long way toward mitigating driver turnover rates, which were one of the biggest contributing factors to the driver shortage in the pre-pandemic era.
Supply Chain Disruptions
Supply chain disruptions were occurring before the pandemic. In 2018, the threat of tariffs on imported goods ranging from cheese to consumer electronics sent shippers scrambling to make the most of the fourth quarter before the import taxes went into effect. In 2019, everyone discovered the tariffs were not being enacted, so the market had a rubber-band effect, and fewer goods were being hauled – not due to tariffs, but because the economy had been flooded at the end of the previous year. The disruption caused carriers to go out of business, and right after 2019 came the pandemic, so the trucking industry was left at a major disadvantage. As the United States pulls away from the pandemic with a potentially stronger economy, the Supply Chain Disruptions Task Force was launched last month. The goal of the task force is to prevent the disruptions we have seen in freight and transportation, as well as other sectors, over the past couple of years so we can get back to a strong economic standing.
A Resurgence in Small Trucking Companies
Outside of the tremendous efforts of the FMCSA, there are big opportunities for owner-operators who want to launch their own trucking companies. The Covid-19 pandemic showed us the stress points in the weakest links of our supply chains. While large carriers had no problem moving supplies and products along major routes, there were major gaps when it came to getting those shipments to smaller towns in America that were removed from the big cities and ports. Commandeering carriers like UPS and FedEx to move vaccines worked great in an emergency, but now that we are moving past the critical stages of the pandemic, there is an opening for small trucking companies to fill a desperately crucial role. As small trucking companies are launched in greater quantity, the stronger our supply chains will be on national, state, and local levels.
At Single Point Capital, we help owner-operators who want to launch their own trucking companies. Our team will help with the forms, paperwork, permits, and insurance, so you can focus on starting your trucking company instead of navigating red tape. Beyond that, we can provide the guidance necessary for long-term success, as well as comprehensive freight bill factoring services to ensure your cash flow stays strong so you can thrive and grow.
To learn more about launching your own trucking company or our freight bill factoring services, contact the team at Single Point Capital today.