US shippers still suffering intermodal blockages

Date: Thursday, April 25, 2019
Source: Lloyd's List

Ongoing trucking shortages are hurting US exporters’ competitiveness on the international stage, warns iContainers

Shippers in the US are continuing to suffer from supply disruption due to trucking shortages, according to digital forwarder iContainers.

As reported in Lloyd’s Loading List last year, US trucking rates surged during 2018 due to a combination of new Electronic Logging Device (ELD) regulations, rising fuel costs, driver shortages and rising demand, prompting lines to warn of premium prices for inland U.S. haulage.

According to iContainers, supply chain headaches continue for US shippers over a year since the hard enforcement of the ELD mandate exacerbated existing trucking capacity shortage problems. The digital forwarder said congestions and delays due to a lack of truckers are continuing to inflate overall shipping costs, taking a competitive toll on US exporters.

“The trucking shortage continues to pose problems for shippers’ supply chains,” said Klaus Lysdal, vice president of operations at Miami-based iContainers.

“It’s causing unpredictable delays and added costs, which are a huge business deterrence that can ultimately affect US exporters’ competitiveness in international markets.”

With trucking companies booked full for days in advance, acquiring trucking coverage for last-minute shipments or shipments with unanticipated zero-hour changes was difficult and expensive.

“Expect significantly higher costs for last minute trucking arrangements or modifications,” added Lysdal. “This is either because shipments end up going into storage or demurrage for failing to secure a trucker or simply because a higher rate is needed to get a trucker to accept the last-minute move.

However, shortages have eased compared to the perfect storm suffered during 2018, with major fleet and recruitment investments made by leading trucking companies helping reduce shortages and rates. “From what we’ve seen, truckers have gotten better at managing their work within the new regulations,” he said.

“Most shippers have also come to terms with the situation. They have realized that more planning is required in advance and have learned to adjust their day-to-day planning and find ways to make it work.”

In the medium to long-term, iContainers expects autonomous trucks and greater digitalisation of supply chains to ease the impact of shortages.

“I look forward to this becoming a reality as one can really envision it offering some very useful alternatives,” said Lysdal. “Whether that means autonomous trucks covering the interstate moves and remote area transits while local drivers handle the drop-off or any other imaginable set up remains to be seen.

“Until then, there is still much work and testing to do as well as rules and regulations to be worked out before we can really consider an autonomous truck solution.”

With no answer in near sight, the forwarder is advising shippers to accept and adapt to the new situation accordingly or risk jeopardizing their supply chains and business.

“At iContainers, we have a notice on our website to warn clients of the situation,” said Lysdal. “We have also been advising clients to book in advance and generally make sure everything is ready at least a week before they want to load.”

“The ones that are not adapting or not willing to understand that you cannot just order a truck to show the next day will end up having their supply chains hurt the most.”

 

Read from the original source.

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