Transportation Industry
The trucking industry is very large, diverse and competitive industry. There are a various types of trucking; they range from tractor trailer, straight trucks, couriers, less than truckload and truck load. Depending on the type of service and price you want to pay you can get just about anything delivered and in the time frame you want it delivered in. There are many factors that factors that are driving the transportation industry, we are going to look at what the trend and outlook for the transportation industry looks like for the next three years and also look at how Fuel and Government regulations are affecting the transportation industry.
Fuel prices, the economy and government regulations are the major deciding factors that will determine the strength or weakness of the trucking industry. Fuel prices have probably the largest effect on the trucking companies because fuel makes up for approximately 25% of the operating costs for an average truck fleet. This is the second largest cost to a trucking company next to the cost of labor. There are a couple things that they can do to help offset the cost of fuel. They can implement Fuel Surcharges that can help make up for some of the lost revenue. Depending on the size of the company they could also purchase large quantities of fuel when fuel on the decline. (“The effect of Rising” 2010). Another huge impact on the trucking industry is the Economy. When the Economy is strong the trucking companies prosper, if the economy is weak most companies struggle and in some cases they fail. Last year 3000 trucking companies went out of business that took one out of every hundred trucks off the road. The reason for this is because the trucks carry almost all the manufactured goods in the country – from cars, toys to lumber. The success of the trucking industry is gauged off of how many goods are being manufactured, how much the consumers are buying. Until the economy turns around the trucking industry is going to
Fuel prices, the economy and government regulations are the major deciding factors that will determine the strength or weakness of the trucking industry. Fuel prices have probably the largest effect on the trucking companies because fuel makes up for approximately 25% of the operating costs for an average truck fleet. This is the second largest cost to a trucking company next to the cost of labor. There are a couple things that they can do to help offset the cost of fuel. They can implement Fuel Surcharges that can help make up for some of the lost revenue. Depending on the size of the company they could also purchase large quantities of fuel when fuel on the decline. (“The effect of Rising” 2010). Another huge impact on the trucking industry is the Economy. When the Economy is strong the trucking companies prosper, if the economy is weak most companies struggle and in some cases they fail. Last year 3000 trucking companies went out of business that took one out of every hundred trucks off the road. The reason for this is because the trucks carry almost all the manufactured goods in the country – from cars, toys to lumber. The success of the trucking industry is gauged off of how many goods are being manufactured, how much the consumers are buying. Until the economy turns around the trucking industry is going to