ATA walks back driver shortage numbers

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Welcome to the WHAT THE TRUCK?!? Newsletter presented by AIT. In this issue, ATA revises driver shortage numbers; CEVA gets robots; and record out-of-service orders.

Mythbusters — Last month, FreightWaves CEO and founder Craig Fuller published an article dismantling the driver shortage titled “The perpetual truck driver shortage is not real.” In that piece, he pointed out that while operating authority for motor carriers rose by 45% since 2019, truckload demand is only up 11% in the same period. The American Trucking Associations wasn’t happy about it.

ATA claps back — It didn’t take the ATA but a day to take notice of Fuller’s article. It wrote, “FreightWaves CEO Craig Fuller calls the truck driver shortage a ‘myth’ in a recent piece of self-promotion, but his assertion collapses under the weight of facts and data.”

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ATA’s facts and data? It claimed that driver shortages in Romania and Poland help prove its case about a truck driver shortage in the USA.

Narratives — The ATA goes on to say: “ATA isn’t in the business of peddling narratives; that’s FreightWaves’ lane.” However, on Monday at the 2023 Management Conference & Exhibition, American Trucking Associations Chief Economist Bob Costello said that the truck driver shortage has fallen from 80,000 to 60,000 drivers. The ATA’s narrative in 2019 was that we’d be short over 100,000 drivers by 2023.

“The underlying problems of the driver market have not gone away.” — American Trucking Associations Chief Economist Bob Costello

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Surplus — Costello is right that the underlying problems of the driver market have not gone away. Turnover is still a massive issue. The very clear reasons for those issues and complaints by drivers have not gone away either. In fact, looking at ATRI’s latest survey, many of them aren’t even being considered by carriers.

With outbound tender rejects below 4% and rates in the toilet, it is hard to peddle a narrative about a driver shortage, especially when there isn’t any ice cream melting on the dock.

In addition, if you are looking for drivers, there are thousands on the market now after bankruptcies at places like Yellow and Meadow Lark Transportation.

P.S. Be nice to the drivers you have because you never know which terminal may snatch them away.

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“Global Ocean Container Rates have just hit a 5-year low! After a brief rise in ocean container rates over the summer, peak season didn’t last long as demand began falling again last month and has driven ocean container rates down to a new YTD and 5-year low (global composite).” — FreightWaves’ Luke Falasca

In-N-Out — John Gallagher reports, “New-entrant out-of-service (OOS) orders issued to carriers will surge to an all-time high in 2023, according to the latest government data, a trend that has mirrored the dramatic increase in new-carrier operating authorities issued since 2020.”

“It’s simple — there’s not enough money in the market right now to maintain these new drivers.” — Daniel Koors, an owner-operator and council member for CDL Drivers Unlimited

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The pandemic trucking gold rush that attracted a record number of entrants did two things: It inflated capacity, which further drove down rates, and it brought in players who were not prepared for a downturn.

Many new participants in the market used load boards and fed off the spot market, but now there is a 79 cent spread between contract and spot rates.

Koors said, “They don’t have the back-office support, they don’t have the capital, they jumped in when things were hot, and they didn’t set up the relationships needed to get them through this downturn.”

The bad news for those trucking companies is those relationships are on the good side of that spread. Want more bad news? There isn’t a driver shortage, there’s a driver surplus.

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Stretch and spot — Dropping off freight is about to get weird as you’ll be greeted by Boston Dynamics Spot robot dogs that patrol CEVA’s new 135,000-square-foot, state-of-the-art transload facility. The Stat reports, “Robots from Boston Dynamics will be used to serve customers at the site located within miles of Port of Long Beach and Port of Los Angeles.”

While Spot robot dogs will monitor the grounds, inside the facility are Boston Dynamics container-unloading bots named Stretch. A press release from CEVA says, “Stretch can reach boxes up to 50 pounds in weight, its vision system enables it to adapt to different stacking configurations, and it does not require any pre-programming.”

While it isn’t clear how many robots will be deployed, CEVA says, “They expect to process a total of 26,000 floor-loaded containers during the facility’s first year in operation and to double its capacity within three years.”

How to transform a supply chain with Brittain Ladd — On Wednesday’s episode of WHAT THE TRUCK?!?, Shatranj Capital Partners’ Brittain Ladd stops by to break down supply chain strategy. Who is making the right moves; where is the money going; what M&A needs to happen now; and what companies are about to become zombies if they don’t change?

FreightWaves’ Thomas Wasson has a new report on ocean rates hitting five-year lows. We’ll break down what’s going on with ocean, rail and intermodal freight.

FreightWaves’ Justin Martin talks about the ATA’s revised driver shortage numbers; record out-of-service orders; if it is ever appropriate to get a massage during a meeting; and more.

Steam’s Lee Britain explains why his team threw 48 water balloons at Steve Cox.

Catch new shows live at noon ET Mondays, Wednesdays and Fridays on FreightWaves LinkedIn, Facebook or YouTube or on demand by looking up WHAT THE TRUCK?!? on your favorite podcast player.

All FreightWaves podcasts can also be found on one feed by looking up FreightCasts wherever you get your podcasts.

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