Maverick

From the desk of John Culp, President In the last Maverick Messenger, we announced the upcoming retirement of Stephen Selig after 32 years of service, where he served the last 15 as president. With his retirement, we are experiencing change and as this is my first article to write as Maverick's new president, change seems like an appropriate topic. Change is inevitable in all aspects of our lives and business is no exception. It may be good, it may be bad, or it may be a choice depending on how you treat it. Sometimes you plan for it, sometimes you react to it, and other times you seek it and make it happen. Sometimes you do all of the above. Maverick was founded in 1980, a year in which sweeping change occurred as the result of the deregulation of the trucking industry. Steve Williams and many other entrepreneurs capitalized on this opportunity and became part of the most exciting growth period in trucking's history. Thousands of new companies entered the industry over the next decade and the truckload sector exploded. Companies that did not adapt to the change are no longer around today. Deregulation of the industry, and those that capitalized on it, fueled economic growth and revolutionized our nation's supply chain. Today, we find ourselves on the verge of what I feel is the most significant change in our industry since deregulation, mandatory Electronic Logging Devices (ELDs). We are all familiar with changes in hours of service regulations and the impact they have on utilization. However, until now, compliance has been less than universal in the industry. The ELD mandate will change that, and carriers who are not prepared will absolutely experience this loss in utilization. If they don't adapt quickly, they are likely to follow the same path as carriers who did not adapt to deregulation. Maverick has planned and prepared for this change. In fact, we became fully equipped with ELDs in September of 2011, long before the mandate, because we felt it was the right thing to do. ELDs are easier to use than paper logs and provide a planning tool for our drivers that help make their job more predictable and less stressful. They also give us more accurate information on available hours for our drivers, which enables us to better manage our fleet and provide our customers with the service they expect. We think this is change for the good. For many shippers, it will absolutely cause capacity constraints as carriers transition to ELDs. However, shippers that are prepared for the change will certainly be ahead of the game and won't suffer the same consequences. Another change we are very familiar with is an ever shifting economy and the impact it has on the transportation industry. I am not an economist and won't opine on why we are where we are, or whether the economy will weaken or strengthen. But I do want to comment on my favorite economic principle: supply and demand, and how it relates to trucking. Not long ago (2014), freight demand was strong and truck capacity tight. Shippers were competing for trucks and working to secure capacity through allocation agreements, better rates and other customized solutions. Today, the pendulum has swung and freight demand is not as strong while truck capacity seems to be ample. For this to happen in such a short period of time with little change in the economy as a whole (GDP), indicates that freight supply and truck demand are near equilibrium. On the capacity side, several transportation analysts state that truck capacity has grown, but I find that hard to believe. Driver demographics alone show more drivers are at retirement age than ever before and we see fewer people entering the workforce that want to be professional drivers. More importantly, whether or not capacity has increased recently, hiring and retaining qualified professional drivers is extremely challenging for us and remains our primary concern for the future. Furthermore, we only see this CHANGE IS INEVITABLE

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