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Cargo haulers struggling to keep up with production increase
Truckers, railroads seek solutions after 6% production riseU.S. truckers, including J.B. Hunt Transport Services Inc. and railroads such as Union Pacific Corp., are hiring more workers and asking customers to spread out shipments because of record demand for cargo hauling. "This situation will continue for the foreseeable future," said J.B. Hunt chief executive Kirk Thompson at a Georgia Tech University forum in Atlanta on truck and rail demand. "Drivers are the key issue. Whether you are saying you want to add capacity is irrelevant if you can't find drivers." Shipping demand is rising as industrial production surges about 6 percent this year. The American Trucking Associations' index of truck shipments last month reached a record and has climbed 15 percent in the past year. The backlog of cargo ships waiting to unload Asian imports was at a high this week, and rail shipments have risen 5.3 percent from last year's record. "Spreading things out by days of the week and seasonally would help," said Thompson, whose company's biggest customer is largest retailer Wal-Mart Stores Inc. Many customers "do a good job shipping on weekends, but receivers don't keep docks open then and drivers have to wait until Monday to unload," he said. "Being creative about ways to move that freight a little earlier in the year will create a little more capacity." Retailers and manufacturers have had to adjust because of the demand for rail and truck capacity. Best Buy Co., the biggest U.S. electronics retailer, has had to ship goods by air at times to keep stores stocked, said Eric Morley, the company's director of logistics. Truckers need to offer "a substantial pay increase" to get more drivers, Thompson said, declining to provide a figure or details of his Lowell, Ark.-based company's pay scale. Hunt has more than 15,000 workers. U.S. truckers are paid an average of $43,000 a year, said Robert Costello, the trucking group's chief economist. He said the group hasn't determined how many more drivers are needed or how much pay will have to rise to attract them. The trucking industry needs to hire about 36,000 workers a month this quarter to fill growing demand and replace those who leave the business, said Eric Starks, vice president of freight consulting firm FTR Associates Inc. in Nashville, Ind. There are about 2.2 million intercity truck drivers, he said. Union Pacific is adding about 5,000 train-crew workers this year and ordering locomotives to help end delays. Posted by: Dar 2004-10-15 |
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