In an interview with Tony Harrelson, Domestic Transportation Manager at Scarbrough International, more questions than answers seems to be the new normal. Tony provides his insights below.
From your perspective, how is the trucking industry handling the COVID-19 crisis?
I can understand why no one has been able to answer the question. It is truly a challenging time. I see and hear conflicting information each day. For example, I talked to one of my truck load carriers last week, and Monday and Tuesday he moved nothing; then Wednesday to Friday he moved enough to make his weekly average. Then I talked to him again yesterday, and he has already made his weekly average in one day.
Large Domestic Brokerage companies like Echo Global and TQL are laying off and furloughing employees.
What are you experiencing at Scarbrough Freight?
- LTL wise, no real delays, outside of deliveries to Amazon DCs, if the product is not considered “essential”.
- LTL carriers are making deliveries on time. The only exception is if the delivery is in an area that is hit hard by COVID (New York) they will not deliver until they confirm the business is open. So, there could be an extra day of transit while the terminal schedules a delivery appointment.
- I have spoken to and received emails from carriers that service the airports or CFS locations in California and NY/NJ area, and they are seeing a reduction in freight. One carrier in NY/NJ area only has about 2-3 drivers coming in each day, and he rotates his driver everyday so he can have some work for each driver.
What are seeing industry wide?
- At the start of COVID, there was a sharp increase in the total number of shipments and now it has dropped off sharply and is at or just below pre-COVID levels. Shippers, that are not essential and the auto industry, have scaled back. Dedicated asset-based carriers that have dedicated lanes now have fewer lanes, and they may not be in the same lanes they normally run, so capacity is displaced.
- For example, XYZ trucking normally does 10 loads from KC to Philadelphia. Now there are only 2 loads, and the other drivers are going in different directions and not ending up in the normal locations, so companies are trying to get drivers back into position.
- Spot rates are coming down in most markets.
- Read today where LA and Ontario, CA are starting to see imports arriving and freight is coming into the warehouses, and this will cause the capacity to starting firm up but, currently still a little below pre-COVID levels.
What is your concern for the near future?
My concern is what will happen to capacity when the produce season starts up. Will it coincide with companies coming back online after being down for COVID? Then we could have a large swing back in the other direction from a loose market to a tight market.
Tony Harrelson, CTB
Domestic Transportation Manager