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Q&A: How has the Trucking Industry Faced the Unprecedented Challenges of the Pandemic?

DeAnna Swinton
Published on March 30, 2021

Over the last twelve months, the Bio Supply Management Alliance (BSMA) has assembled executives of the transportation and logistics industry to address the unprecedented challenges of the COVID-19 pandemic. In view of the critical role of trucking, Devendra Mishra, the Executive Director of BSMA, interviewed Jeff Tucker, CEO of Tucker Company Worldwide, to better understand the recent past, present, and future of the industry.

Devendra Mishra, BSMA: How large is the trucking industry in the overall transportation network of the USA and how would you describe the “State of the Union” of the trucking industry?

Jeff Tucker, Tucker Company Worldwide: The trucking marketplace is extremely diverse and, unlike most industries that have seen significant consolidation (big tech, telecom, automotive, consumer products, etc.), trucking continues to diversify and deconsolidate. In the U.S. today, there are nearly 265,000 for-hire trucking companies, employing 2,950,000 truck drivers. Of those nearly 3 million drivers, 1 million have been added in the past 8 years, and many of them have migrated to smaller truck fleets. (This is a decade-long trend that has accelerated with widespread adoption of smart fleet technology.) Today, fleets with 1-100 trucks employ about half a million more drivers than the largest fleets with 2,500+ trucks. According to the U.S. Bureau of Transportation Statistics, trucks handle 69.1% of the value of freight — the largest share across all transportation modes. Virtually everything we own in our homes and offices were brought by truck — oftentimes, multiple trucks. As drivers continue to migrate to smaller fleets, it is critical that shippers ensure they are partnering with fleets of all sizes, to fill their capacity needs.

MISHRA: As we embark upon the distribution of the approved vaccines for COVID-19, what segments of the supply chain will trucking serve?

TUCKER: Trucking is instrumental in every segment of the supply chain. Even air freight requires a truck on both sides of the flight. Temperature-controlled trucking has touched nearly every finished dose of the COVID-19 vaccine and will continue to do so (in some cases, two or more trucks will be involved). Both temperature-controlled trucks and dry trailers have been supplying therapeutic support, inbound materials, packaging, and other goods in support of the manufacturing and distribution of vaccines throughout the year. And while the vaccine distribution is enormous in count, scope, and urgency, vaccine dosages are very small. Many thousands of doses can move in one truck with insulated containers.

MISHRA: How will the trucking industry handle the stringent cold chain requirements of the Pfizer and Moderna vaccines?

TUCKER: Pfizer and Moderna have done an extraordinary job in working with their packaging suppliers to ensure that the packaging enables effective distribution of the product, to maximize its efficacy at its ultimate destination. Trucking’s role, while important, has been largely relegated to efficient, safe, and secure transportation. Critical? Yes. Particularly special? No — not much different than any other pharmaceutical shipment.

MISHRA: How do you envision visibility and accountability of the vaccine shipments to be achieved in the end-to-end supply chain?

TUCKER: I think visibility and accountability are still the Holy Grail within every supply chain but making the vision a reality varies depending on what “end-to-end" means to you. When it means shipping dock to shipping dock, that is a relative snap of the fingers today. A small, but growing group can do that now. However, when you view it as the entire production process, from raw materials, to batches, to lots, and finally into a patient’s arm, that requires significant investment and, likely, blockchain technology that is within industry’s sight but out of reach. Imagine the manufacturing process; the various suppliers (and their suppliers); the qualities, efficacies, and temperature excursions; the various truck and air suppliers; the vaccination sites and freezers being used by each; and even the care taken on-site before the vaccine enters an arm. It’s mindboggling supply chain built on training, trust, and ultimately dependent upon human behaviors, in some stages. It’s reasonable to expect we’ll get to the latter example of visibility and accountability, but not in time for COVID-19.

MISHRA: Transportation workers are one of the first responders in a pandemic. What can be done to safeguard their health and ability to deliver?

TUCKER: It is my opinion that the wellbeing of several categories of essential workers, such as teachers and transportation professionals, has been neglected over the course of the COVID crisis. In the earliest days of pandemic — even during a shutdown, with the uncertainty that brought — truck drivers and warehouse workers put the wellbeing of our country first. They stayed on the road, used rest stops, exchanged paperwork at docks, and never worked from home. They put themselves in harm’s way to feed us, and they still don’t have an initiative by anyone to support them. What might one look like? Vaccinations for anyone with a CDL at truck stops around the country. Over 160,000 truck drivers were forced out of the business in mid-2020 by the pandemic, and many are still hurting financially. But we’re still not addressing their needs. Many are on the road every day and for extended stretches. How do we expect them to get to their state’s local drugstore or mega-site on the required appointment day? We need to meet them where they are. As a population, truck drivers are upper-middle-aged and have significantly higher rates of heart disease, diabetes, and other health issues that put them at heightened risks. It’s time that we say thank you and prioritize their health and safety.

MISHRA: These are extraordinary times for entrepreneurial companies like yours. How do you describe your company in terms of its unique services to meet the emerging challenges?

TUCKER: The pandemic wiped out a lot of drivers and pushed big carriers away from some of their core customers as networks changed, prices changed, and ROI demands changed. This is still occurring. This had a strong butterfly effect that’s rippling through the country, further upsetting supply chains that were already brittle. Tucker Company Worldwide has been able to help our customers sustain their timely transportation and distribution levels from early 2020 to the depths of the pandemic, and through today’s capacity crisis. And we’ve been able to step into some of the most unique situations, as manufacturers seek to meet the demands of a vastly changed world and when other carriers, brokers, and forwarders faltered.

Another force that served to decentralize and fragment the trucking industry is the fact that every supply chain and manufacturer is different. Traditionally, the larger and more asset-intensive the provider, the more the manufacturer must change its operations to fit into a mold. That’s not the way business should be done. Today’s market demands a customer-centric approach to operations where transportation service providers are customizing their operations to meet the customers’ needs, not the other way around. That is the approach we take with our customers. Tucker creates customer-specific standards of care (SOCs), and has specific procedures backed by our quality policies. We’re ISO-9001:2015 certified and we use it to our strategic advantage in meeting customer demands.

MISHRA: In the post-COVID world, how equipped is the inter-modal transportation network to handle the challenge?

TUCKER: In early and mid-2020, during the early months of the pandemic, I had the privilege to be “Sentinel” for the Supply Chain Analysis Network (SCAN), which is a collection of logistics experts from MIT’s Humanitarian Supply Chain, Dewberry, the Center for Naval Analyses and the American Logistics Aid Network. As a sentinel, I provided insight from my vantage point as a transportation company operator and expert, and I was among a group who often proofread reports prior their delivery to the FEMA Logistics Management Directorate, as they prepared to brief top government officials. Those reports analyzed regions of the country and studied the supply chain operations and vulnerabilities.

While there are certainly improvements we can make, I’m generally pleased with and proud of how resilient our supply chains are. I remain amazed at how willing drivers are to put their lives on the line to deliver into hotspots. Who can forget New York City during the early days of the pandemic? Drivers never stopped serving. In fact, at Tucker, we supported several humanitarian efforts delivering essential goods into hotspots and offered free transportation of supplies. In doing so, there was never a lack of drivers and trucking companies wanting to be the ones who donated their services to make that delivery. It was extraordinarily heartening.

The American transportation system is remarkably adaptable. It has always moved freight when it needed to be moved. Always. No matter what. That’s amazing. Now, that doesn't mean that pricing is stable. Pricing has been erratic over the past 7 years, due in part to the fact that the industry has been in a perpetual state of near equilibrium. We learned it first when the polar vortex in 2014 threw market pricing into disarray for 6 or more months. Then 2018 came. Then, the already overheating late 2020/early 2021 market was turned on its head by the storms that devastated Texas’ infrastructure and power grid. By definition, that elevates freight prices into the stratosphere. Why? Ports are slow. Rail train speeds slow and capacity is harmed. Importers and intermodal shippers divert to truck. Truck prices go up because all shippers and brokers are vying for the same assets. But assets are limited. Trucks are out there, but you aren’t connected to them. You’re connected to your chosen few providers. Getting connected to new providers takes time. That time costs you money, because you only have the spot market to go to. During the 2003 and 2018 capacity crises, it took 16 months for the market to “normalize.” There is no telling about 2021. Will it be 6 or 16 months? Nobody knows. Regardless, shippers simply must change their procurement strategies to avoid these perfectly predictable pitfalls. When you’re balanced near equilibrium, any dust up can throw freight budgets out the window — regardless of how large your company is. Nobody is big enough to guarantee prices or control the everchanging nearly $1T U.S. freight market.

But what hasn’t changed in my 30 years, is that America can move freight more effectively and efficiently than any country in the world and I’m proud to be part of it.

MISHRA: What do you foresee will be the changes to the transportation industry in the post-COVID marketplace?

TUCKER: Technology will continue to spread throughout. Electronic bills of lading and proofs of delivery took on importance in a no-touch world. On March 18, 2020, we experimented with a three-day work from home battle test that has turned into a 365-day war that we’ve won. Our workplace environment will be forever changed. Exactly how is still to be determined, but we are working on a solid mix of home and in-office time. Tracking and interconnectivity of intermodal shipments handled by multiple companies should be on the near-term horizon.

Building on my answer to the previous question, I sincerely hope that more manufacturers are recognizing their methods of transportation procurement need to change. The notion that it’s somehow smart to find a collection of large carriers to handle one’s freight is last century’s strategy and doomed to fail today. Every time. It ignores the fact that drivers don’t drive for those carriers as much as they drive for smaller fleets. Brokers and forwarders are the transportation providers of the future, but for those savvy manufacturers who have watched the data and witnessed the fickleness of the big carriers, they’ve already made the transition. Even more important than what your providers are is who they are in terms of performance. Whether you ship to the big box stores, or to the main drug distributors, your profit margin is eaten alive if you’re not on-time. Performance has to drive every important logistics decision for manufacturers. A little freight savings "won” by procurement that ends up costing millions in unnecessary and punitive OTIF fines and other compliance fees eat some, if not all, of a company’s profit. It’s happening everywhere. It’s not a cost of doing business. It’s a cost of choosing your providers unwisely. As inventory becomes a precision game, OTIF will only get worse.

Finally, I’m betting the ranch on customers continuing to want service, technology, and reporting customized to their exact needs, so they can run their businesses and supply chains exactly as they designed. Providing our customers with data that drives their organizational behavior, and the behaviors of their vendors and even their customers is another big driving force behind ongoing changes.


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