Trucking companies can expect both negative and positive trends this coming year.
With 2020 quickly fading in the rear-view mirror, trucking companies are just as happy to leave that whole year in the dust.
For many, it was a struggle to stay afloat. For others, it was a struggle to meet rising demands. Essentially, the COVID-19 pandemic divided the trucking industry into two distinct groups: carriers that moved essential goods for consumers, like groceries and sanitary products, who saw a sharp rise in demand; and carriers that moved non-essential industrial or manufacturing products, who struggled amid the pandemic.
But enough about the past. As we open our new 2021 calendars, we have to do so with a mixture of optimism and realism. Trucking companies have cause to be hopeful about 2021, but they should also be aware of potentially negative trends.
The Good, the Bad and the Uncertain
As a leading business financing company, WiseCap has a vested interest in seeing your trucking company flourish, which is why we wanted to take this opportunity to share expert forecasts for trucking in 2021. We’ve pulled our information from a variety of reputable industry sources, like Fleet Owner and Truck News, as well as credible researchers like Martec and Benzinga.
Whether you plan on expanding in 2021 to meet rising demands, or refinancing to help your business stay afloat, WiseCap can help. Our expert team of business owners, entrepreneurs, and professionals can help walk you through options like commercial truck loans and equipment refinancing options.
Strong Market Conditions and Forecasted Growth
According to several qualified sources, there is one bit of good news to take away: the trucking industry appears to be on track for a rebound in 2021.
Some sources forecast growth between 11 and 25%. Others, like Freight Waves (citing forecasts from the major German bank, Deutschebank), contend that a 7.8% year-over-year growth rate in industrial production will signal fortune for carriers, especially LTL carriers.
On this blog, we recently pointed out that the IMF expects a 5.2% rebound in real GDP in 2021. Consequently, commerce observers predict that supply chain management companies are well-positioned to grow, which is good news to trucking companies.
That’s a lot of numbers to throw at you, but the bottom line is consistent – you can expect business to be better in 2021.
A Shortage of Quality, Qualified Drivers
Of course, analysts are also tempered in their optimism. Along with growth, many contend that there will be a shortage of quality, qualified drivers in 2021 – a trend that many already experienced last year.
Some observers credit this shortage of qualified workers to the COVID-19 stimulus cheques, which they say have “couched” many drivers. Others point to rising consumer demands, saying that driver shortages are due to the fact that there just aren’t enough trucks on the road. And many point to the fact that the closure of many truck driver training schools has kept back new entrants to the profession.
Whatever the reason, Fleet Owner found that nearly 2/3’s of trucking businesses surveyed said they were struggling to find qualified drivers. With the lack of talent in the pool, companies have been forced to increase pay and benefits to attract drivers (which is great news for drivers, but may be hard on already-struggling trucking businesses.)
If you find that your business is struggling to stay afloat, as it either pays more for quality drivers or receives less for contracts (or both,) come chat with the finance experts here at WiseCap. We can walk you through our equipment refinancing services and other available options.
Continuing Embrace of Technology
The growing embrace of technology is not a new trend. But analysts predict that we can expect to see the trend accelerate in 2021, as more businesses plan to utilize automation and predictive maintenance technology to cut costs and stay ahead of the competition. These technologies include “blockchain, robotics and predictive analytics,” emerging technologies that you expect to see normalized in the future.
There’s also a growing trend in the industry toward sustainability, with many companies seriously investigating alternative fuels and other methods for reducing emissions.
Finally, let’s leave things on a positive note. 2021 looks promising, albeit with the potential for a few bumps in the road. But, according to Fleet Owner, the long-term forecast is even sunnier.
In a recent article, they predict that the rebound in 2021 can lead to an even stronger 2022. It’s a potent reminder of the enduring value the trucking industry has, both in the marketplace and in society. Things are looking up. To capitalize on this future growth, look into our opportunities for commercial trucking companies at WiseCap. Together, we can hopefully make the coming years the best on record!