Trucks
Trucks
Running an efficient and profitable trucking business is far from simple and often means having to navigate through multiple hurdles at once. Here are the six biggest challenges facing haulage and transport operators today.
1. Adapting to an unpredictable economy
Transportation has always been a cyclical business and heavily reliant on the economy. In recent years, many businesses have had to adapt to an unprecedented global pandemic, a supply chain crisis, a cost-of-living crisis, severe inflationary pressure and rapidly rising interest rates. Ensuring profitable operations despite all these obstacles is a constant challenge – especially when it’s impossible to predict what is around the corner.
“During a downturn, you can't do much about the big things that are affecting the wider economy,” says Michael Browne, a professor at the University of Gothenburg who has been researching goods transportation and logistics for over 30 years. “Instead, concentrate on the smaller things that you do control. This is a good opportunity to seek out more information about how your company is performing in terms of fuel consumption, drive times and route planning, and find areas where you can improve.”
It is just as important to maximize operational efficiency during upturns, as this will help ensure that your business is more agile and resilient to the next downturn.
With fuel accounting for a significant portion of a fleet’s operational expenditure, fluctuating prices have a huge impact on a company’s bottom line.
Fuel can account for over 40% of a fleet’s total operational expenditure. As such, even a small increase in the price can make a big difference to a company’s bottom line.
Like the rest of the economy, prices are unpredictable and often subject to geo-political events outside of a fleet owner’s control. But there are things that you can do to keep fuel consumption down to a minimum.
“Saving fuel might sound obvious but I’m still surprised how many transport operators cannot provide any data on their fuel consumption because they do not measure it,” says Michael.
“Without this, how can you find opportunities to reduce costs? For example, a well-trained driver will use less fuel and plan their routes better. But you need data to know where and how training should be applied.”
Read more on how to encourage fuel-efficient truck driving and how technology can contribute to driver development.
The global driver shortage continues to worsen and the latest forecasts are predicting that it will double in the next five years. This will make it increasingly difficult for transport companies to maintain their current operations, let alone expand and develop.
This is not a challenge that can be resolved simply by increasing wages, since work-life balance is also an important contributing factor. In this case, work-life balance does not necessarily mean long working hours, but also being away from home for longer periods.
“The average age of drivers is high, which indicates that it's an unattractive industry for younger people,” says Michael. “The hours they're expected to work, the stress they’re under while working or the fact that there are more appealing alternative careers open to them: these are just some of the reasons why.”
Changing the work conditions can help change these perceptions of the profession. However, part of the problem, according to Michael, is a lack of engagement with drivers from researchers and policy-makers. “It’s quite surprising how little academic research has been done on drivers. We’ve got people writing about everything else from aerodynamics to autonomous vehicles, but there is a big gap in understanding the driver and the role they play.”
Learn more about how to attract and retain drivers or ways to address the driver shortage.
Many truck owners are holding back on electrification until the charging infrastructure is more developed, but those that are getting in early can potentially reap the benefits first.
Increasingly stricter emissions legislation, as well as growing demand from the market for more sustainable transportation, means that haulage companies are under growing pressure to transition away from diesel.
Already a number of major cities, including Paris, Athens, Madrid and Stockholm, are planning to ban diesel vehicles in their city centers as early as 2025. However, what is less certain is which fuel sources will be used instead. Consequently, many businesses are taking a wait-and-see approach. But in doing so, they risk being left behind.
“There is growing interest in alternative fuels but still a lot of uncertainty about when would be a good time to do something about it,” says Michael. “Right now, a few companies are moving first. As the market continues to develop, we’ll eventually reach a tipping point where suddenly companies will see all their competitors making the switch so they will too.”
Learn more about the different routes to a fossil fuel-free future for trucks or about the range of alternative fuels.
Ensuring safe and secure overnight parking will not only help protect goods but make drivers feel more valued and supported.
It’s increasingly more difficult for drivers to find safe and secure parking facilities for overnight stops, forcing them to park in unsafe locations.
It is a growing concern across the EU and the situation is particularly acute in the US, where the United States Department of Transportation (USDOT) believes that there is just one parking spot for every 11 trucks. The EU has already introduced regulations to help avoid a similar scenario on European roads but access to safe parking remains a challenge.
“In places like Kent in the UK, where you have so many trucks crossing over the channel, you’ll find drivers parked in all sorts of weird places, like narrow roads, simply because there are not enough safe facilities for them,” says Michael.
“It’s odd that we give drivers responsibility for such large and expensive vehicles loaded with valuable goods, and yet we do not take their welfare more seriously.”
“Some drivers also complain that they can’t even access basic facilities like toilets when making deliveries. I think it’s odd that we give drivers responsibility for such large and expensive vehicles loaded with valuable goods, and yet we do not take their welfare more seriously.”
Part of the problem is uncertainty over who should be responsible for providing such facilities. And while it’s unreasonable to expect transport companies to resolve the issue alone, they can assist their drivers, for example, by compensating them for the cost of using safe facilities.
This will not only ensure better protection for their goods but will also make their drivers feel more valued and by extension contribute to higher driver retention.
Right now, the big trends in urban planning revolve about creating more livable cities, through concepts like 15-minute cities, Healthy Streets and Complete Streets. However, such concepts often overlook the role of freight and logistics despite accounting for such a significant portion of any given city’s traffic flows.
“This means that sometimes urban planners are not taking freight into account, and not allocating space for it,” says Michael. “New developments should always consider freight transport - for example by ensuring there are sufficient loading bays in large buildings that receive many deliveries.”
However, Michael does believe this is improving and that municipal authorities are starting to give goods transportation more consideration.
“Since the pandemic, everybody is now aware of the supply chain, and suddenly, you’re seeing this term used daily in the media to an extent that was inconceivable a few years ago. I think this reflects a broader appreciation of how important freight and logistics flows are to society, and cities are becoming much more engaged in working with transport operators to find solutions to complicated problems in urban freight transport deliveries.”
