Heritage Logistics Group

"Your Source for Supply Chain Solutions"

 

The market has experienced months of lower than normal manufacturing production and the associated ordering cycles have impacted the freight industry. Although carriers are banking on increased volumes to replenhish inventories - thusfar those shipments have not materialized. As a result carriers are being hard pressed to maintain acceptable operating ratios and market share.

The overall freight environment is one of the most dramatic many trucking executives can remember since before deregulation. Carriers with high fixed costs are struggling to maintain as freight volumes continue to decline. Most trucking executives do not have a strong belief that any type of turnaround could, or will, come before the end of the year.

Shippers are currently taking advantage of the heavily discounted rates offered by many carriers. However as carriers handle the shipment capacities, then certainly pricing will shift in favor of the carriers. Through all of this market flux - less capacity, less manufacturing, bleeding of inventories - carriers must continue to provide on-time service of damage free shipments or risk loosing their existing customer base.