Let the Good Times Roll

This Editorial appears in the July 20 print edition of Transport Topics. Click here to subscribe today.

Now that we’ve had a week to digest the Transport Topics 100 ranking of the largest for-hire carriers in the United States and Canada, it’s clear that our coverage focused as much on the coming silver lining as on the bleak economic reality of 2008 and the first half of 2009.

It certainly was no surprise to any regular reader of Transport Topics that 2008 wasn’t a very good year for most fleets. And things have only gotten worse this year.

But the total coverage package shows that many fleets are bracing for a return to more normal business levels, and the challenges and opportunities that will present.

Everyone seems to agree that freight-hauling capacity in North America has been notably diminished during the recession, as a result of fleet failures and downsizing.

The tractor fleet is aging as new truck sales remain at distressingly low levels. Business has been even worse for trailer makers and parts suppliers. This week, we report that Class 8 truck sales for the first six months of 2009 are the lowest in at least 20 years (see story, page 1; click here for article).

But a thorough reading of the TT Top 100 For-Hire Carriers report shows that many fleet executives believe the recovery — when it finally arrives — will provide immediate relief and vast improvement in financial results.

Companies that have managed to conserve cash and limit debt appear to be in the best shape to take advantage of the recovery. Analysts are predicting a new wave of industry consolidation as carriers seek additional capacity when demand increases. These analysts believe that a shortage of available late-model equipment and drivers to man them will retard overall capacity growth.

As one analyst put it, “The strong will get stronger and the big will get bigger.”

Recession survivors can expect “the mother of all bull freight markets, once we emerge from the other side of this horrible period,” said another.

The latest economic data seem to show a slow but steady improvement in business activity around the nation, although there are still worrisome issues, as some lagging indicators, such as total unemployment numbers, report further deterioration.

A return to “normal” business levels would be a welcome relief for trucking and truckers, and for the truck-supply industry. We’re all waiting breathlessly.