Fleet Management News & Business Info | Commercial Carrier Journal
Issue link: http://read.dmtmag.com/i/795447
commercial carrier journal | march 2017 57 New administration, ELD deadline raise hopes for 2017, but driver challenges remain constant BY JEFF CRISSEY A er the banner years the trucking industry had in 2014 and to a lesser extent in 2015, last year seemed downright lousy by comparison. Despite the decrease in trucking conditions in 2016, driver availability remains the overwhelming number one concern for fleets heading into 2017, based on results from the 2017 CCJ Eco- nomic Outlook survey, Commercial Car- rier Journal's annual report tracking fleet sentiment in the new year. Of all survey respondents, 46.0 percent believe driver availability will be their biggest challenge this year, including 49.8 percent of for- hire carrier respondents and 40.9 percent of respondents from private fleets. One positive sign the survey results show this year is less fear over freight volume. Twelve percent of for-hire re- spondents said freight volume was their biggest challenge in 2016, but only 5.7 percent believe it will remain so in 2017, suggesting hopes for tightening capacity. Success in 2017 likely will be dictated by a carrier's ability to weather the tran- sition to electronic logging devices and seize on emerging market opportunities, as well as the ability of President Trump's administration to deliver on campaign promises to stimulate job growth and increase domestic manufacturing output. HIGHER INVENTORIES THE NEW NORM Outside of the driver shortage, perhaps the biggest headwind plaguing carri- ers last year was relatively high retail inventories-to-sales ratios – a problem dating back to early 2015 – leading to suppressed volumes, particularly in the dry van truckload market. "Demand was weak through most of 2016," says John Larkin, managing director of transportation research at Stifel Nicolaus. "It firmed up toward the second half of the year, but firm at a low level. Part of that was because inventory had worked its way closer to the end of the correction." Since the all-time low of 1.34 in early 2012, the retail inventories-to-sales ratio climbed to 1.52 in March 2016, its high- est point in nine years, according to data from the U.S. Census Bureau. Eric Starks, chairman and chief executive officer of FTR Transportation Intelligence, says a return to 2012 levels is unlikely soon. "Inventories have seen some correc-