TRUCKING INDUSTRY (COMMERCIAL)

Beginning in the early 1980s the trucking industry changed as deregulation and new technology brought new competitive pressures to the trucking industry. Information technologies and expanded services such as express delivery of light freight had become staples of the trade. Implementation of these new technologies and the promise of advantageous global trends insured the continued strength of an industry that experienced its worst years during the recession of the early 1980s.

Both state and federal governments had a tremendous impact on the revenues generated by the trucking industry. Although it experienced federal deregulation, the industry continued to deal with strict regulations in 28 states during the early 1990s. In an effort to make state regulations coincide with each other, Congress passed the Intermodal Surface Transportation Efficiency Act in 1991. The International Registration Plan would be passed in 1996 and the International Fuel Tax Agreement in 1998, legislating out repetitive registration requirements and fuel tax payments incurred by interstate truckers.

In addition to registration and tax costs, government programs such as the Motor Carrier Safety Assistance Program added an estimated $6,000 to $9,000 annually in maintenance work required to meet the standards of vehicle safety inspections that, like the International Registration Plan and Fuel Tax Agreement, were recognized by even the most strictly regulated states. The safety inspections, as well as a national Commercial Drivers License that may be obtained only after passing a competence exam, did lower insurance costs for the industry offsetting the initial expenses.

While Congress was legislating programs intended to make things less complicated for the trucking industry, the Environmental Protection Agency (EPA) mandated clean air laws making it necessary for trucking companies to find ways to utilize low sulfur fuels. Although the industry found it difficult to switch completely to the new fuels, advancements in exhaust purification and newly designed, highly efficient engines lowered emissions considerably.

Figures published during the early 1990s indicated that the trucking industry employed approximately eight million people, including part-time workers. The industry could be broken down into three main categories: those directly employed by trucking companies, those employed by employer groups, and those working for private carrier fleets. Although there was no real trucking union to speak of, a considerable number of truck drivers were members of the International Brotherhood of Teamsters (IBT). As was the case in most industries, union members tended to receive higher pay than non-union workers. Typically, large trucking companies that employed union workers put 60 to 65 percent of the company's profits aside for wages and benefits. Non-union drivers typically received 40 percent of the company's revenue in the form of wages and benefits. Annual salaries of long-distance drivers varied from $20,000 to $40,000 with a cap of approximately $60,000 for experienced drivers.

Other impacts on the trucking industry included advancements in communications technologies. The proliferation of fax and electronic mail were estimated to have cut nearly $75 million from the industry's annual profit margin. In order to compensate for the losses, the industry was able to carve out a new niche through the zero-inventory management policy used by many companies to reduce overhead costs during the early 1990s. A perfect fit for the trucking industry, this cost-saving policy called for same-day, warehouse-to-customer transportation of parts and manufacturing materials.

Because of competition from communications technologies, production efficiency technology became essential to the trucking industry's ability to compete. Computers mounted in truck dashboards and portable laptops became invaluable tools which freed truckers and company administrators from the tasks of monitoring fuel taxes and fuel management performance, engine performance, results and due dates for trailer inspections and so on. In addition to improvements in the efficiency of administrative duties, companies began utilizing safety applications including radar technology informing truckers when they followed behind another vehicle too closely, shipment planning software maximizing trailer time, and driver simulators.

Since the trucking industry relied on the health of the economy, it continued to be important for the trucking industry to expand into new, non-traditional markets and take advantage of progressing technologies. The trend toward a less restrictive international trade policy enhanced by the North American Free Trade Agreement (NAFTA) should ensure the industry's prosperity well into the next millennium.

TRUCKING INDUSTRY (COMMERCIAL)

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