2020 was a year of many tests for the trucking industry as the COVID-19 pandemic sent more customers than ever online for shopping, and grocery stores and medical centers needing boosted supplies of household goods and medical gear.
Because of this, publicly-traded fleets saw rising spot rates and financial results throughout the course of the year.
Additionally, workers throughout the industry, including suppliers, logistics providers, truck manufacturers, and fleets themselves did their part to lower the potential spread of the coronavirus within their workspaces and in public. These protocols brought about social distancing and remote work where applicable, and trucks and facilities are now regularly and more vigorously sanitized and cleaned. Drivers and other industry workers have also been provided with plenty of masks and cleaning supplies.
These changes didn’t mean challenges didn’t continue on for the industry, though.
“In February, we were coming off an all-time record unit year in 2019, and still going flat-out,” said Utility Trailer Manufacturing Co. senior vice president, Craig Bennett. “Then, in March, the bottom fell out, and numerous orders were canceled and delayed. We furloughed or laid off around 1,100 people and reassigned all other teams.”
These difficulties brought about a record low of 209 industry trailer orders in April, with Class 8 orders dropping to 4,251–as compared to 14,859 the year prior–during the same month. Still, as fleets added trucks for replacement, Class 8 sales stayed mostly consistent throughout 2020.
In regards to laid-off or furloughed workers, around 70% have been rehired, with new employees onboarded as well, according to Bennett.
Because of truckers’ boosted efforts to deliver the most important freight for our nation’s well-being, they understandably were considered heroes during 2020 with truckload carriers receiving the most work and benefit, according to SJ Consulting Group founder Satish Jindel.
Less-than-truckload carriers that rely on retail or heavier industrial shipments in the public sectors saw more decline in the second quarter of the year, with a revenue drop of 17.9% and a 16% year-over-year shipment decline.
“The pandemic effect on LTLs was significant,” Jindel said.
Although the virus’s long-term effects were felt industry-wide, Bob Costello, chief economist for American Trucking Associations, assured that already-in-place business practices were not a factor.
“It was a health crisis that morphed,” he said. “We have to get solutions to the health issues for trucking to come out of this completely. Eventually, the economy is going to grow at a really strong clip to historic highs.”
As oil prices rose in the later end of 2020, hopes surrounding the COVID-19 vaccine remained high, and industry experts expected the global fuel demand would relax as these vaccines became available.
“We’re seeing a rebound in demand, and refiners have been tightening to the [oil] supply,” said Phil Flynn, an industry analyst based in Chicago. “The refiners had to work off a lot of diesel supply, and they have done all they can to draw down those inventories because there’s been a glut. We’re also seeing demand here in the U.S. and China start to go through the roof again.”
As the virus began showing up across North America, oil demand was not quickly considered anything to worry about.
“The reality is that, at first, there was not much attention paid to it,” said John Lyboldt, president of the Truckload Carriers Association. “But after a week, COVID-19 became the buzzword and we were grateful to have concluded a successful event just before the virus grew into the global pandemic that it became.”
During this time, communication throughout the industry and its relationships with collaborators were forced to evolve, according to North American council for Freight Efficiency executive director, Mike Roeth. Work was still completed as usual, but the majority of contact between fleets, employers, distributors, manufacturers, and customers became digital and distant.
“I am so proud of how this industry continued its great collaborative work during this pandemic,” said Roeth. “It is just extraordinary and a testament to this industry and our ability to get things done.”
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