This year’s State of Logistics Report suggests that the era of cheap freight may finally be coming to a close.
2014 was the best year for the supply chain industry since the Great Recession. The report found that a recovering economy will drive shipping volumes so high that the trucking industry will struggle to keep up. This combined with tight warehouse capacity is expected to cause freight bottlenecks.
While this might seem like great news for trucking, the report did note that smaller trucking companies are being driven out of business by tougher safety regulations.
In addition, the report said that trucking companies will “raise rates 10% and more and more companies will follow suit…they don’t have a choice.”
Industry experts say that the reason that we have not yet seen significant increases in trucking rates is because the economic recovery has been slower in some parts of the country and trucking companies feel compelled to keep their rates competitive.
The State of Logistics Report is prepared annually by the Council of Supply Chain Management Professionals.
Sources:
Wall Street Journal
Wall Street Journal Blogs