Cost, demand headwinds driving new post-pandemic playbook for fleet management
Even as trucking begins to find some balance, fleet managers face renewed challenges on many fronts as they work to keep trucks rolling and drive every ounce of efficiency into their operations.
Gary Frantz is a contributing editor for DC Velocity and its sister publication, Supply Chain Xchange. He is a veteran communications executive with more than 30 years of experience in the transportation and logistics industries. He's served as communications director and strategic media relations counselor for companies including XPO Logistics, Con-way, Menlo Logistics, GT Nexus, Circle International Group, and Consolidated Freightways. Gary is currently principal of GNF Communications LLC, a consultancy providing freelance writing, editorial and media strategy services. He's a proud graduate of the Journalism program at California State University–Chico.
The nation’s trucking fleets have been under tremendous pressure over the past two years, first dealing with the broad impacts of Covid on truck drivers, shippers, and consumers. Now, facing an uncertain post-pandemic economy beset by loose freight demand, fleet operators are navigating a host of new and familiar challenges, from an inventory hangover, continued supply chain disruptions, and aging equipment to stubborn inflation raising the costs of everything from tires, brake pads, and lubricants to liability insurance, wages, and rolling stock.
How are fleet operators managing and what does success look like in today’s environment?
In an unsettled, inflationary economy, shippers tend to become more risk averse, “circling the wagons” and looking deeply at every area of cost in an effort to control rising expenses and protect margins. For fleet managers, that often can mean that contracted volume commitments the sales team secured with shippers—and which fleet managers plan network operations around—aren’t meeting expectations. That shortfall, combined with surging costs, is throwing a wrench into the best-laid operating plans and puts a premium on flexibility and agility.
PRIVATE FLEETS GROWING
Gary Petty is president and chief executive officer of the National Private Truck Council, the industry association for private fleet operators, who account for over 50% of overall trucking capacity. From his perspective, the pandemic and the period after it “was a fertile proving ground for private fleets.” He cites the pre-pandemic year of 2018 as pivotal. “That was a transformative year. There was more freight than capacity, a lot of loads sitting on docks. And 7 million jobs begging for workers.”
Trucking capacity became a vulnerability. “Some really big companies went into private fleets to ward off not being able to get capacity when most needed,” he recalls. Then when Covid hit two years later, “private fleets were in a preferrable position. Some saw volumes increase 50% almost overnight. No way could they buy that capacity [in the for-hire market].”
Private fleets were able to absorb those volumes and deliver against extraordinary demand, Petty says. That was critical for businesses such as food service and medical supplies, where a lack of capacity or inability to deliver with near-100% on-time accuracy could have huge ramifications on consumer health and welfare.
Now in the post-Covid world, Petty sees private fleets adding drivers and equipment, shedding for-hire capacity, which was used as a “circuit breaker” for surging demand, and shifting more inbound and outbound traffic to in-house fleets.
“That helped reaffirm the reputation of private fleets as the gold standard in trucking. It’s proven essential as a competitive resource to get product on demand to customers,” Petty says, adding that private fleet growth bears that out. According to council statistics, in 2022 (vs. 2021), private fleet shipments increased 10.3%, while volumes, shipment value, and miles run rose 7.3%, 11.3%, and 9.2%, respectively, a string of eight years of consecutive growth.
Petty stresses that building a private fleet also is one of the most strategic—and challenging—decisions for a business to make. “You have to decide to be a trucking company, hire professionals, invest in resources, equipment, and technology, and develop the skills and expertise to do it successfully—and earn a reputation that attracts drivers.” That’s a challenge in today’s market, which Petty characterizes as “hysterical” in its efforts to recruit and retain from a shrinking pool of qualified drivers (he points to sign-on bonuses of $5,000 to $10,000 as an example).
Nevertheless, private fleet driving jobs themselves are among the most stable and well-compensated in the business, with an average 14.5% turnover rate in the 15 years leading up to 2021 (before an increase in 2022 to 22.5%). Drivers often can rely on regular runs, consistent pay and miles, competitive benefits, and good home time. “Our last reporting for 2020 found average base pay around $80,000 with another 22% in benefits. That’s a nice ticket,” Petty says.
ANYTHING BUT STABLE
On the for-hire side of the business, inflation’s stubborn persistence coupled with slackening freight volumes is a continual thorn in the side for fleet managers. “The past 12 months have been anything but stable,” notes Greg Orr, president of Joplin, Missouri-based national truckload carrier CFI. “Think about tires, all the liquids that go into a truck, wages, maintenance as trucks get older, [and] recruiting and retention costs. All these common operating expenses have gone up dramatically. That makes things especially challenging in the current market where freight is not as plentiful and shippers are extremely focused on their financial position.”
It’s a market cycle where shippers are taking advantage of loose capacity and lower rate structures in the short term. And that’s at the expense of loads that originally may have been under a contract. Orr gives the example of a shipper who committed to 10 loads per week on a certain lane, but because of demand or production issues, ends up only providing five. “When you build a plan based on certain expectations or promises, you commit that capacity for that time. Now since we can’t count on those loads for those trucks, we have to adjust and shift that capacity, often on the fly. One customer’s decision ripples through multiple customers, lanes, and our plans for how to service them.
“It becomes extremely challenging to keep your network as tight as normal and still provide the consistency of service the customer demands, in a cost-efficient way.”
Another shift that Orr and others are seeing is a slow but steady return by shippers to “just-in-time” practices. During the pandemic, shippers, finding inventories depleted, deliveries delayed, and store shelves empty, switched to “just in case” practices, essentially ordering more product to avoid stockouts, but also dramatically increasing inventory.
“Shippers are still figuring out where the balance is,” Orr says. They are dealing with two challenges simultaneously: They’re still trying to shed obsolete or overstocked products, free up warehouse space, and drive excess inventory out of their supply chains, while at the same time reverting to making smaller but more frequent shipments to shorten time to market and support quickly changing consumer demands and/or production schedules, he notes.
All these factors complicate the job of fleet managers as they plan for and deploy drivers and trucks, assign capacity to meet shipper deadlines, set and organize maintenance schedules, deal with downtime from truck breakdowns, manage detention at shipper docks, and plan for driver home time.
THE EXPANDING REPLACEMENT CYCLE
Another challenge that’s come out of the pandemic is fleets experiencing longer replacement cycles for rolling stock. One fleet manager noted that original equipment manufacturers (OEMs) have such a backlog of orders that a build slot secured today for a new tractor won’t deliver for 24 months—or longer depending on the OEM.
That’s shining a very bright spotlight on fleet maintenance, both capacity and resources. Trucks and trailers in service longer need more maintenance more frequently. As a result, fleets need more mechanics and more maintenance bays—or find themselves spending more on expensive outsourced maintenance from third-party shops.
In this market with the shortage of new equipment, “you can’t take anything out (retire old equipment) so you have to work with what you have and keep it running,” notes Webb Estes, who earlier this year became the fourth generation of the Estes family to take the reins of Estes Express Lines, a privately held Richmond, Virginia-based LTL (less-than-truckload) carrier. “That puts a huge strain on people, parts, and resources, and you’re dealing with more downtime and more parking space for trucks in repair.” That’s had a lot of ramifications, but it also has revealed opportunity for ingenuity, says Estes, who now serves as the carrier’s president and chief operating officer. “We pride ourselves on having a lot of out-of-the-box thinkers, people who see problems differently and come up with solutions,” he says.
SPREADING THE WORKLOAD
One such solution was looking at the Estes network and finding strategic terminal locations where the company could add shops and “spread out the workload.” The advantage: getting more maintenance work done locally, which limited travel time to far-away shops, improved uptime and equipment availability, and reduced use of expensive outsourced maintenance shops.
The other benefit: more locations where mechanics could work day shifts. “Good, qualified mechanics are hard to come by, and they hate working nights,” he notes. “Day shifts, particularly at more of our smaller facilities, give us flexibility and are attractive and [have] helped us staff up effectively.”
Another piece of Estes’ out-of-the-box thinking was in acquiring rolling stock. “We bought a bunch of equipment from Central Freight [which closed in December 2021], and that gave us a lot of additional capacity,” Webb Estes says. That move, however, did come with some challenges, in terms of dealing with different equipment specs, more maintenance needs, and the time needed to get the equipment detailed and up to Estes’ standards before it could be deployed in the network.
Estes also stressed the importance of culture to any fleet management strategy. “It’s not just about trucks and trailers, forklifts and dollies,” he explains. “It’s just as important as a management team to constantly work to prepare your people for success, support them, invest in them, and give them the tools and encouragement they need.”
The pandemic presented all types of challenges to trucking companies, including financial hardships for employees. Estes decided to step up and help in an unusual way: offering interest-free loans to employees. The program kicked off in April 2020. “We intended to offer it just during Covid,” says Estes. “But we got such a positive response, we decided to keep it going,” which proved prescient with the onslaught of interest rate increases and financial institution troubles over the past year.
“Their job is their collateral,” he explains, adding that to qualify, employees were required to take an Estes-sponsored financial literacy class to help them better understand personal financial planning, the impact of debt, and how to manage it. Nearly $10 million has been loaned under the program, with close to 6,000 Estes employees participating.
“We see it as an advantage being privately held and debt-free, and especially in this environment, employees recognize that,” Webb Estes says. “We’re trying to do the little things to support them, make them part of the Estes family. … No matter what comes up in their lives, Estes is a place they can rely on.”
RELEARNING THE BUSINESS
The Covid era, from the second quarter of 2020 through the first quarter of 2022, was such a disruptive force that managing a trucking operation during that time was an exercise in “putting out one fire after another,” notes Avery Vise, vice president of trucking for research firm FTR Transportation Intelligence. Simply getting the freight on the road and dealing with a string of shipper crises was a daily challenge.
And while it was a financially rewarding period for carriers, it also took a huge toll on the workforce, Vise adds. Now, in a more sedate post-pandemic market, the new struggle is “reminding and retraining staff about the blocking and tackling of running a trucking company in a more normal environment, what you have to worry about, how you manage resources to ensure margins,” he notes.
It’s an increasingly important reboot given that freight has slowed, and managing for efficiency and optimizing networks is more critical than ever, he says. And while Vise sees “spot rates pretty much at the bottom—so it’s possible we’re seeing the end of the bleeding [from declining rates]—freight is not going to be gangbusters for most of the remainder of this year.”
The larger question, Vise believes, is whether more capacity will come out of the market as small carriers exit the industry. “There is not a whole lot of [market] shift left to happen,” he notes. “For a carrier to expect much growth [this year] it will have to come organically. The economy isn’t likely to be much help.”
Electric vehicle (EV) sales have seen slow and steady growth, as the vehicles continue to gain converts among consumers and delivery fleet operators alike. But a consistent frustration for drivers has been pulling up to a charging station only to find that the charger has been intentionally broken or disabled.
To address that threat, the EV charging solution provider ChargePoint has launched two products to combat charger vandalism.
The first is a cut-resistant charging cable that's designed to deter theft. The cable, which incorporates what the manufacturer calls "novel cut-resistant materials," is substantially more difficult for would-be vandals to cut but is still flexible enough for drivers to maneuver comfortably, the California firm said. ChargePoint intends to make its cut-resistant cables available for all of its commercial and fleet charging stations, and, starting in the middle of the year, will license the cable design to other charging station manufacturers as part of an industrywide effort to combat cable theft and vandalism.
The second product, ChargePoint Protect, is an alarm system that detects charging cable tampering in real time and literally sounds the alarm using the charger's existing speakers, screens, and lighting system. It also sends SMS or email messages to ChargePoint customers notifying them that the system's alarm has been triggered.
ChargePoint says it expects these two new solutions, when combined, will benefit charging station owners by reducing station repair costs associated with vandalism and EV drivers by ensuring they can trust charging stations to work when and where they need them.
New Jersey is home to the most congested freight bottleneck in the country for the seventh straight year, according to research from the American Transportation Research Institute (ATRI), released today.
ATRI’s annual list of the Top 100 Truck Bottlenecks aims to highlight the nation’s most congested highways and help local, state, and federal governments target funding to areas most in need of relief. The data show ways to reduce chokepoints, lower emissions, and drive economic growth, according to the researchers.
The 2025 Top Truck Bottleneck List measures the level of truck-involved congestion at more than 325 locations on the national highway system. The analysis is based on an extensive database of freight truck GPS data and uses several customized software applications and analysis methods, along with terabytes of data from trucking operations, to produce a congestion impact ranking for each location. The bottleneck locations detailed in the latest ATRI list represent the top 100 congested locations, although ATRI continuously monitors more than 325 freight-critical locations, the group said.
For the seventh straight year, the intersection of I-95 and State Route 4 near the George Washington Bridge in Fort Lee, New Jersey, is the top freight bottleneck in the country. The remaining top 10 bottlenecks include: Chicago, I-294 at I-290/I-88; Houston, I-45 at I-69/US 59; Atlanta, I-285 at I-85 (North); Nashville: I-24/I-40 at I-440 (East); Atlanta: I-75 at I-285 (North); Los Angeles, SR 60 at SR 57; Cincinnati, I-71 at I-75; Houston, I-10 at I-45; and Atlanta, I-20 at I-285 (West).
ATRI’s analysis, which utilized data from 2024, found that traffic conditions continue to deteriorate from recent years, partly due to work zones resulting from increased infrastructure investment. Average rush hour truck speeds were 34.2 miles per hour (MPH), down 3% from the previous year. Among the top 10 locations, average rush hour truck speeds were 29.7 MPH.
In addition to squandering time and money, these delays also waste fuel—with trucks burning an estimated 6.4 billion gallons of diesel fuel and producing more than 65 million metric tons of additional carbon emissions while stuck in traffic jams, according to ATRI.
On a positive note, ATRI said its analysis helps quantify the value of infrastructure investment, pointing to improvements at Chicago’s Jane Byrne Interchange as an example. Once the number one truck bottleneck in the country for three years in a row, the recently constructed interchange saw rush hour truck speeds improve by nearly 25% after construction was completed, according to the report.
“Delays inflicted on truckers by congestion are the equivalent of 436,000 drivers sitting idle for an entire year,” ATRI President and COO Rebecca Brewster said in a statement announcing the findings. “These metrics are getting worse, but the good news is that states do not need to accept the status quo. Illinois was once home to the top bottleneck in the country, but following a sustained effort to expand capacity, the Jane Byrne Interchange in Chicago no longer ranks in the top 10. This data gives policymakers a road map to reduce chokepoints, lower emissions, and drive economic growth.”
"Shrink" is the retail industry term for the loss of inventory before it can be sold, whether through theft, damage, fraud, or simple book-keeping errors. In the ongoing effort to reduce those losses, Switzerland-based retail tech company Sensormatic Solutions has expanded the scope of its Shrink Analyzer application to shine a light into previously unmonitored parts of brick-and-mortar stores where goods tend to go missing.
The newly enhanced, cloud-based application can now integrate radio-frequency identification (RFID) and electronic product code (EPC) data from overlooked parts of the building, like employee entrances, receiving doors, "buy online, pick up in store" (BOPIS) doors, or other high-risk areas selected by a store. It then integrates that data into Sensormatic's analytics engine to provide insights into when, where, and how shrink occurs to help users strengthen their loss-prevention strategies, the company says.
Those expanded capabilities allow the platform to provide enhanced "shrink insight" at locations beyond the store's main exit, Sensormatic says. For example, strategically placed RFID scanners at employee exits can reduce internal theft while providing item-level evidence for theft investigation efforts. Likewise, monitoring online-order pickup doors can help retailers both improve in-store e-commerce fulfillment accuracy and identify employee theft events, according to Sensormatic.
A few days before Christmas as I was busy preparing for the holiday, I received a text message from my bank asking if I had attempted to purchase a $244 Amtrak ticket in Orange County, California. Considering that I had the card in my possession and that I lived thousands of miles away from the attempted purchase location, I promptly replied "No." Almost immediately, a second message informed me that my card was locked and to contact my bank.
I'd like to say this was an isolated incident, but in 2024, I had to replace the same card four times. Luckily, it just took a quick trip to my local bank to replace the compromised card, but it was still an unwanted hassle.
Fraud is a never-ending issue facing not just consumers but businesses as well—no one is immune, it seems. In its latest industry report, "Occupational Fraud 2024: A Report to the Nations," the Association of Certified Fraud Examiners (ACFE) estimated that businesses lose 5% of their revenues to fraud each year. This report focused specifically on three basic types of occupational fraud: asset misappropriation, corruption, and financial misstatement. But what about other types of fraud?
The media often report on big organized theft rings stealing goods from trailers, trains, or containerships, or on bands of thieves breaking into warehouses or retail stores—but there are so many other ways in which fraudsters wreak havoc.
For instance, another area where fraud is rampant is consumer returns in the retail industry. Software company Appriss Retail, in collaboration with business management consultancy Deloitte, recently published its "2024 Consumer Returns in the Retail Industry" report. It states that "total returns for the retail industry amounted to $685 billion in merchandise in 2024." That might seem like a drop in the bucket compared to the $5 trillion in sales U.S. retailers racked up last year, but as the report's authors note in the executive summary, "the amount of fraud and abuse remains a significant issue that should be addressed. Fraudsters and abusers are often becoming adept at circumventing retailers' controls across all channels."
So what can businesses do? According to the ACFE study, internal controls (i.e., surprise audits, management reviews, hotlines or other reporting mechanisms, fraud training, and formal fraud risk assessments) are the best defense against occupational fraud.
When it comes to consumer returns fraud, Appriss Retail's report concludes that while retailers continue to adapt and refine their fraud prevention strategies, it's a delicate balancing act. The trick is for "retailers to implement solutions that have [a] minimal impact on the consumer experience," the report noted. "Brand loyalty can be fragile and competition continues to grow, so holding onto consumers is often a key to long-term success."
Then there's security and asset protection. Last October, I attended a session at the Council of Supply Chain Management Professionals' EDGE 2024 conference that focused on security and safety. In that session, Lee Ambrose, vice president of business development for Remote Security Solutions (RSS), discussed advanced strategies and technologies for violence prevention. But he also touched on asset/transit protection and specific solutions that can help companies discourage theft.
As an example, Ambrose cited his company's transit surveillance unit (TSU)—a portable monitoring device that can be installed on trailers to protect in-transit freight. According to the company's website, the TSU uses AI (artificial intelligence) detection, security cameras, and two-way communication to deter criminal activity, providing real-time detection and notification when unauthorized persons attempt to enter the trailer. It claims the device has a deterrence rate of 98%.
In the end, sometimes there is only so much a company can do to mitigate fraud/theft. But we are fortunate to have resources we can turn to if we need help. It's an uphill battle, but one that we will keep on fighting.
Most retail, wholesale, and manufacturing businesses are focused on fundamentally restructuring their supply chains to stay ahead of economic uncertainty. That’s according to results of the second annual State of Supply Chain report from supply chain solutions platform provider Relex Solutions, released Tuesday.
Relex surveyed nearly 600 professionals from retail, consumer packaged goods (CPG), and wholesale businesses across seven countries and found that 60% said they are overhauling their supply chains due to tariff uncertainty and market volatility.
Respondents said they are grappling with unpredictable consumer demand, escalating trade tensions, and unreliable supplier networks. More than half (52%) said demand volatility is their biggest challenge, forcing them to rethink inventory strategies in real time as shifting spending habits disrupt supply chains. In addition, 47% of businesses pointed to global trade disruptions and rising tariffs as a growing threat—with tariff volatility fueling concerns over higher costs and sourcing bottlenecks—and43% said they struggle with a lack of real-time data and visibility, making it harder to adapt to sudden shifts in demand, labor shortages, and transportation delays.
To counter those challenges, companies said they are making “bold operational shifts,” according to the study. Many are expanding their supplier networks, moving sourcing closer to home, and accelerating automation investments. Among retailers, 62% said they are addressing cost pressures through a combination of efficiency improvements and price adjustments, while 50% said they are actively broadening supplier bases to safeguard against economic and geopolitical instability.
“Supply chains are in a pressure cooker—between tariffs, demand shifts, and unpredictable disruptions, the outdated and traditional way of operating isn’t sustainable,” Dr. Madhav Durbha, Relex Solutions’ group vice president of CPG & Manufacturing, said in a statement announcing the findings. “Companies that lean into AI, automation, and supplier diversification will not only weather this volatility but emerge stronger. The ones that don’t risk falling behind.”
The full report, Relex State of Supply Chain 2025: Retail and CPG Dynamics, is slated for release in March. The report was conducted by market research firm Researchscape in January 2025.