Small carriers and owner operators make up the large majority of the nation’s carrier base. Very small carriers – fleets with one to six tractors – account for 86% of total U.S. carriers, according to recent FMCSA data. Small carriers – those with 7 to 19 tractors – make up another 9%. All together, these fleets provide over 30% of the industry’s available power units.
Despite their prevalence in the market, these players tend to be the most affected during market downturns. Smaller teams means smaller budgets and less wiggle room when it comes to weathering losses and safeguarding bottom lines. While larger carriers are often equipped to handle volatile market conditions, a dramatic swing can drive a smaller operation out of business.
Current market conditions – combined with the climbing expenses of operating and maintaining a truck – have created a difficult situation for the small companies that keep America moving.
“These are the carriers that find work elsewhere when the costs of owning and operating a truck become too expensive,” MegaCorp Logistics User Experience Manager Winnie Barton said. “In current market conditions, it is important for shippers and brokers to have conversations with their owner operators and small carriers to keep their trucks moving so they can continue to support and provide capacity in the transportation industry.”
While going out of business is, of course, a tragic outcome for the carriers themselves, it is important to remember that nothing happens in a vacuum. When a large percentage of carriers go under, shippers, brokers and end consumers all feel the impact. This is especially true for smaller shippers, as well as consumers living in more rural parts of the country.
Read more: FreightWaves