According to a national carrier survey conducted by Transport Capital Partners (TCP), 22% of carriers indicated they have given serious consideration to leaving the transportation industry or liquidating if tonnage does not increase in the next six months.
However, 36% of respondents said they were interested in buying a company in the next 18 months, indicating that many carriers feel that a down period economically is a good time to expand operations, TCP said.
“It’s interesting that such a high proportion of people are saying they are considering getting out of the industry, but so many are also considering buying,” TCP managing partner Richard Mikes told FleetOwner. “I was really surprised at the number of people who said they would consider buying a company in this environment.”
In addition, 58% of respondents said they expect freight rates to drop over the next 12 months, compared to 20% who felt that way in November, while 37% said that they expect volumes to decrease during that period.
Mikes noted that the number of carriers who answered “no response” to questions about freight volume dropped from 12% in November to 0% in February, which he attributed to people being firmer in their beliefs and therefore more willing to share it.
However, the overall tone is still overwhelmingly negative, according to Mikes. “People are very pessimistic right now,” he said. “A lot of people are pressured and tired of the state of the economy.”
Sixty-two percent of carriers indicated that a majority of their shippers are seeking a reduction in rates while 64% said that shippers are trying to redefine their fuel charge formula. In addition, 42% indicated that one or two of their major shippers have either gone out of business or are operating under bankruptcy protection.
Nearly half of the carriers surveyed said they have not cut any non-driver staff since September, while 26% cut more than 5% and 27% cut under 5%, TCP said.