Savvy shippers have been taking the long view in their efforts to overcome what promises to be an ongoing capacity crisis, by investing in private fleet resources. Yes, it is a front-loaded capital expense to purchase equipment and add costs associated with driver training, retention and compensation. However, several pieces of news this week seem to validate the long-term efficacy of this strategy. Follow past the jump for details on why now is a great time to be a private fleet operator.
Diesel Prices Tank amid Global Glut
So says this article in the Wall Street Journal which notes an increase in distillate inventories up a full 12% over the same period of time last year. Today, the average price of a gallon of diesel is $2.72 versus $3.85 last year. Trucking fleets, among the largest users of diesel fuel are capturing significant savings adding to their bottom line profitability.
For the operators of smaller private fleets
– for example, high volume shippers using
a blend of common carrier and private
fleets as a hedge against capacity constraints –
these reports are some very welcome news.
ATA: Turnover Drop ‘Significant’
So reads the headline from a Transport Topics article published this week, wherein it is reported that driver turnover rates have fallen precipitously to a four-year low among the larger fleets. In spite of the acute shortage of truck drivers partly to blame for the capacity woes that have plagued the trucking industry for some time, the combination of increasing driver pay and improved quality of life incentives have resulted in the uptick in retention figures.
For the operators of smaller private fleets – for example, high volume shippers using a blend of common carrier and private fleets as a hedge against capacity constraints – these reports are some very welcome news. Those organizations with the discipline and foresight to invest in all the relevant areas – private fleet equipment and drivers, retention programs and logistics IT solutions for transportation management – are reaping the positive benefits befitting the risks they took to achieve them.