What Will Happen In The Trucking Industry in 2024?
by: Peyton Panik : Fleetio
1. Continued economic concerns
2023 saw the trucking industry in a freight recession, with more trucks and drivers than there was demand for fleet. The issue was most noticeable in situations like trucking mainstay Yellow Corporation filing for Chapter 11 bankruptcy, a clear signal of the volatility of the transportation market.
Going into 2024, many experts are still raising alarms at low freight volumes, so fleet managers should be prepared to explore rightsizing as the market continues to stabilize post-pandemic. Some hope though – toward the end of the year, there seemed to be some reversal in the downturn as demand increased slightly, which could mean some positive growth for the year ahead.
2. Supply chain disruptions (and resilience)
The last few years post-COVID 19 have continued to highlight the vulnerabilities in supply chains, but it has slowly begun to unclog over the past year as the market for used vehicles and parts has begun to correct. A big takeaway from the CSMPC State of Logistics Report is that reducing cost on the shipper side is no longer the primary driver of supply chain decisions, with more capital going into ensuring demand can be met through technological solutions and contingency plans.
Fast adaptation will continue to be key for fleets as we move into 2024, and fleet managers should consider widening their pool of suppliers and setting solid contingency plans for delivery failures and unavailability, as well as utilizing technology and predictive analytics where they can to foresee and forestall any issues that may arise from disruptions.
3. Driver recruitment challenges
A continuing trend from years past, finding new drivers from the upcoming generation of the workforce still presents a problem. The American Trucking Associations (ATA) projected an over-60,000 driver shortage for 2023, and that number will increase to 82,000 in 2024.
While the specificity of those numbers have been up for some serious discussion (see here the back and forth between ATA and Freightwaves), many fleet managers are still feeling the crunch as fleet demand continues to increase and driver numbers have not climbed with it. Be prepared for hiring and training to be top conversations in 2024.
This proactive approach makes static preventive maintenance outdated, where over-maintenance of healthy vehicles is common, leading to unnecessary expenses and downtime spent in the shop. Now, AI allows fleet managers to schedule maintenance and repairs before a breakdown occurs. When coupled with predictive insights, traditional PM schedules become dynamic, allowing the full use of current resources to a fleet’s most efficient level, reducing downtime, and minimizing maintenance costs.
4. Persistence of e-commerce
While consumer spending slowed over the course of 2023, the continued surge of e-commerce should prompt fleets to continue to push for high optimization in 2024. Americans have begun to rely on the efficiency of e-commerce delivery, and for last-mile delivery services, any break in that process can mean disaster.
Fleets should put an extra emphasis on operational efficiency in the coming year to continue to adapt to the demands of the market, including route optimization, delivery consolidation and improved real-time tracking.
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5. Electrification and sustainability goal setting
Fleets are facing more and more regulatory requirements each year, including the EPA’s new final standards intended to cut methane emissions in the trucking industry. As all signs point us toward the goal of a zero-emissions future, 2024 is a good time for fleet managers to take a look at their sustainability plans.
EV prices in the consumer are still on a downward trend, but prices on EV trucks like the Tesla Semi and other models still cost nearly 3% more on average than their ICE competitors before considering tax incentives. While it’s not a one-to-one trade off in budgets just yet, EVs are becoming more feasible, but there are still plenty of other emissions cutting measures that fleet managers can consider in the meantime, like better preventive maintenance measures or more detailed telematics tracking.
6. Tech stack expansion and cybersecurity
To maximize efficiency in the coming year, fleet managers should continue to refine their approach to fleet technology. The trucking industry has continued to embrace and integrate advanced technologies such as telematics, Internet of Things (IoT), and Artificial Intelligence (AI) to enhance efficiency, safety, and fleet management.
As fleet tech stacks continue to expand, there will also need to be a similar focus on heightening cybersecurity measures in 2024. The more connected a fleet is, the more potential there will be for potential breaches, so ensuring that fleet software is locked down the two-factor authentication or utilizing single sign on (SSO) will be the bare minimum necessity for any tech-forward operation.
7. Geopolitical impact
2023 saw the continuation of conflict between Russia and Ukraine as well as a new conflict in the Middle East between Israel and Palestine, which is bound to continue to create shockwaves in the geopolitical landscape. There is a high chance of impact on oil pricing as well as global trade routes similar to what we saw in 2022 and 2023, so fleet managers will need to stay abreast of issues as they develop.