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GTS Blog

Fuel & Capacity, Part 1: The Effect on Carriers

Posted by Ascent Global Logistics on Mar 31, 2017 9:58:17 AM

Working in the logistics industry means you’re at the mercy of two entities: the economy and the government. A combination of increasing fuel costs, capacity limits and well-intended CSA regulations have been crippling business owners.

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Here are a few areas in which the CSA has tightened its regulations:

-          Weight limits on shipments

-          Fitness tests for truck drivers

-          Stricter road policies and heavier fines

-          Higher emissions and efficiency standards

-          Consecutive hours drivers are able to move shipments

When added up, these regulations make it difficult for carriers to stay competitive. Many small carriers are going out of business or being bought out by larger companies. Industry veterans are starting to call it quits altogether.

Aside from federal regulations, rising fuel costs are making carrier operations very expensive. Did you know that a commercial truck can easily burn through $70,000 of diesel fuel a year?

It's also worth noting the effects of weather and seasonality on the market. Winter storms shut down many of the roads this year; driver and capacity restraints were felt across every industry.

Companies have to be very agile to keep up with market changes. Shipping is the second largest cost small businesses face – that’s why executives are smart to take advantage of the savings that 3PLs can offer them through carrier partnership negotiations and logistical efficiency.

If you want to learn more about how to save time & money by partnering with a 3PL, visit www.onestopshipping.com.