Why are market rates so high?
Many factors come into play when
- CHINA IMPORTS: Record imports from China are still surging and hit the highest levels in 12 years in July. This puts a lot of pressure on capacity, especially in California.
- CORONAVIRUS: Many drivers are staying off the road due to the risks involved with the novel cornoavirus; as the average age of drivers in the U.S. is over 55 years of age.
- STIMULUS CHECK: Government stimulus checks took some drivers off the road so they could stay at home instead of sleeping in a cab for similar net pay.
- APRIL LOW RATES: Back in the April timeframe drivers were picketing Washington as truck pay dropped to historic lows, due to demand dropping, and some of this capacity has still not returned.
- BANKRUPTCY: Trucking companies have been affected like the rest of the industries as smaller firms went out of business due to these challenging times.
RETIREMENT: Older drivers are accelerating their retirement plans due to the current climate; with very few new drivers back filling those positions.
REGULATIONS: 21,000 drivers temporarily lost their licenses after testing positive in the DOT new drug & alcohol clearinghouse. DOT week and E-logs also contribute to lower capacity.
BUYING BEHAVIOR: The historic spike in grocery and home improvement shook up capacity. Changing demand has created unseasonable peaks and valleys in output and capacity across states and different lanes.
FINAL MILE: Skyrocketing demand for final mile delivery has created higher pay that entices OTR drivers to take on more local gigs.