A number of factors are conspiring to encourage rising US freight prices, which could impact the automotive supply chain. Limited truck driver availability, the introduction of a new Electronic Logging Devices (ELD) mandate and the ramping up of vehicle production due to an improving US economy and recovery from natural disasters that impacted the country, are all placing increasing strain on existing infrastructure. January 2018 was one of the tightest capacity markets on record for truck cargo, and led to increased utilisation of emergency logistics services. Such expertise has been able to safeguard automotive industry production by ensuring just-in-time delivery of crucial shipments and supply chain continuity.
“Tonnage requirement is up in 2018 while the number of truck drivers is down, which has led to a disparity between loads and available drivers,” explains Brad Brennan, managing director of emergency logistics expert Evolution Time Critical, which operates a control centre in Atlanta, GA. “We have worked with a number of US-based car makers and Tier suppliers to sustain production during a testing period; manufacturers cannot afford to rely on turbulent supply so are seeking a solution that guarantees on-time delivery.
“Working with a dedicated emergency logistics partner provides added assurance,” he continues. “Evolution has access to a vast supply base of road suppliers across North America, and our flexible, multi-modal capacity ensures that ultra-time sensitive shipments can be expedited through air freight when required.”
Low truck supply and high freight demand has been exacerbated by too few drivers caused by a high proportion of retirements and a perceived low wage. The new ELD mandate, which strictly controls driver hours and freight movement availability, has also placed added strain on the industry, and posed additional issues for smaller fleet operators required to invest in expensive hardware: another factor influencing a rise in the cost of freight.
“Vehicle production and freight requirement is forecast to remain stable in coming months, which is driving the need for manufacturers to find a robust method of ensuring on-time shipment,” concludes Brennan. “Working with a multi-modal emergency logistics partner provides added visibility of supply and ensures swift alignment of an optimal solution when required.”