Artificial intelligence (AI) influences our personal lives, businesses and industries by transforming the way we live today. However, AI has already been making a positive impact in the trucking industry for several years. Fleets have been using AI to optimize complicated processes, improve safety standards and enhance vehicle performance. By using AI models, trucking companies can quickly analyze large amounts of data to efficiently plan routes and dispatch trucks, allowing personnel to focus on customer service and driver support.

Carriers can also utilize AI-powered safety and maintenance systems to reduce potential incidents over the road. Just like everyday motor vehicles, heavy duty trucks are equipped with collision mitigation systems, including automatic braking and lane departure warnings. Truck manufacturers and maintenance facilities use AI to predict potential service failures, helping carriers schedule proactive repairs before there are costly and dangerous breakdowns over the road.

Despite economic uncertainty and rising operating costs, PGT continues to grow, making strategic investments across the country to better support our customers and fleet of Proud Professional Drivers. With new terminals in Ghent, Kentucky, and Spartanburg, South Carolina, PGT expanded our presence in the South, creating a regional operations base to service our core customers and expand our driver fleet.

PGT also opened a sales office in Monterrey Nuevo León, Mexico, to enhance our cross-border solutions. PGT’s customers with southbound and northbound needs in Mexico can count on PGT’s international presence and decades of transportation expertise to safely move their cargo. As one of four flatbed carriers providing volume shipments in and out of Mexico, PGT has operated out of Laredo, TX, for 29 years, moving more than 4,000 cross-border loads annually.

Our new PGT Laredo facility is opening in Q3 2024, which will expand our international operations and provide modern driver amenities. Follow PGT on social media for more updates on this custom built, state-of-the-art terminal.

According to the American Transportation Research Institute (ATRI)*, the cost per mile to operate a truck increased 29.0% between 2020-2023. Insurance premiums grew by 12.5% in the past year, driven by more expensive equipment and litigation with nuclear verdicts. These rising costs, combined with a soft freight market, make it even more difficult for carriers to succeed, often resulting in higher driver turnover.

The economy continues to be a concern for the trucking industry, which was listed as the number one issue in ATRI’s annual Top Industry Issues list in 2023. Forecasts for the second half of 2024 remain stagnant, fueled by the uncertainty of the upcoming election cycle.

*ATRI is non-profit research organization dedicated to providing in-depth studies and findings related to the trucking industry. Since 1954, ATRI has been a leading source of transportation data. Their annual reports and extensive research are widely considered a definitive measure for the trucking industry.

The trucking industry continues to experience increasing insurance rates, due in part to the rise in nuclear verdicts. A nuclear verdict is defined as a court decision of $10 million or more, typically from a severe accident or injury lawsuit involving large trucks and motor carriers. These rulings have been trending upward since 2013 (excluding the pandemic period when courts were shutdown). According to a study by the U.S. Chamber of Commerce Institute for Legal Reform, the overall mean nuclear verdict from 2013-2022 was $89 million.

Motor carriers are a prime target for litigation, and trucking companies are now faced with the impact of such high-cost rulings. Insurance premiums continue to increase despite a two-year decrease in the number of fatalities and injuries resulting from crashes involving large trucks. Carriers are forced to adjust their operating plans to accommodate higher insurance rates, which means they have less money for continued safety improvements and new equipment. Legal reform is needed to curtail the significant upward trajectory of nuclear verdicts and insurance premiums.

Carriers are struggling to acquire and maintain equipment, forcing them to run high mileage units longer. Truck and trailer payments increased by 18.6%, and the industry still faces shortages in parts and labor, impacting the carriers from maintaining the performance of their current fleets. While new Class 8 truck orders have slowed, OEMs are still working through a backlog of orders from the previous two years. Older trucks can negatively impact customer service and driver retention, as neither customers nor drivers appreciate time and revenue lost during a lengthy repair process.

For the 12 months ended May 2023, the annual inflation rate in the U.S. dropped to 4.0%, a positive sign following two years of rapidly rising costs. In June 2023, the Federal Reserve announced they would skip another rate increase while continuing to observe the economic trends across the country. Americans may be experiencing a slight relief in the prices of consumer goods, but interest rates remain high and the inflation rate is still well above the 2% target. In the spring, the financial world also experienced three high profile bank collapses, further impacting consumer confidence in the U.S. economy. With a cautious economic forecast, a decrease in consumer demand and workforce shortages, manufacturers have slowed production, focusing on reducing inventory levels to cover only their most immediate needs.

There are approximately 350,000-400,000 Owner-Operators, or Independent Contractor Truck Drivers, in the U.S. These drivers value their flexibility, choosing the hours, freight, and lanes they work. They are not employees of a trucking company; they own their truck and their business, selling their services to the customers and companies they prefer. Recently, the independent contractor model has been challenged through reclassification laws, with attempts to label independent truck drivers as company employees. On a federal level, the Department of Labor is expected to decide on a proposed rule to reclassify workers in early 2024.

Independent truck drivers are vital to the U.S. economy, supporting the supply chain and growing commerce. Worker reclassification will eliminate these independent businesses, forcing Owner-Operators into company employment or early retirement.

For more than a decade, lack of available truck parking has been a primary concern for truck drivers, negatively impacting the transportation industry and supply chain. Truck drivers waste an average of 56 minutes of drive time per day looking for a safe parking spot, and for new entrants to the industry, a lack of proper trip planning could force them to shut down their day early or drive past their allowable hours while looking for a parking space. Legislation has been introduced in Congress to provide much needed funding for the transportation industry, but in some areas, there simply is not enough land to expand along major highways.

The trucking industry needs to continue to advocate for improved parking facilities, enhancing the safety and lifestyle for our truck drivers.

The trucking industry moves 10.93 billion tons of freight in the U.S., which is estimated to increase 1.4% per year through 2050. Despite this growth, the country’s infrastructure continues to decline, with no notable improvements across any category. There is even an estimated $2.59 trillion gap in funding through 2029 to repair these systems.

In June 2023, a portion of Interstate 95 in Northeast Philadelphia collapsed due to a tanker truck fire, causing a two-week closure of the highway. A new temporary roadway will allow traffic to pass through the area while the permanent roadway is rebuilt, which is expected to take several months. Around 160,000 vehicles are estimated to travel the affected area daily. While the overpass was rated in good condition by the Pennsylvania Department of Transportation, the closure caused heavy traffic congestion and freight delays for several days.

Freight transportation continues to be a leading contributor of carbon emissions in the U.S., responsible for over half of the nitrogen oxide total emissions inventory in the country. The trucking industry moves about 72.2% of America’s freight tonnage, making motor carriers a primary focus for sustainability efforts. Battery electric vehicles can be a viable option for both carriers and customers, but long-haul applications will be better served through hydrogen fuel cell electric vehicles. This innovative equipment continues to be researched and tested as the trucking industry works to provide more sustainable transportation services.

The American Trucking Associations notably estimated a record-setting shortage of 80,000 truck drivers in 2021. Despite an increased focus on driver retention in the industry, estimates still point to a deficit of 78,000 drivers in 2002. Current labor shortages across the country provide alternative career options to truck drivers looking for more local opportunities, and a continually aging workforce sees more drivers retiring each year. Although truck drivers were hailed for their essential services during the pandemic, the profession still lacks a strong appeal to younger generations. The trucking industry must continue to evolve, supporting our drivers with additional benefits, roadside services and safety improvements. Rising costs, lack of parking and equipment delays all impact driver retention.

Trailer orders hit record levels at the end of 2022, continuing the trend of equipment shortages faced by carriers during the past two years. Production of heavy-duty trucks stalled due to a global shortage of computer chips and lingering supply chain issues, forcing carriers to use aging equipment and drastically reduce their capacity. Manufacturers hope to catch up to demands for new orders in 2023, but trucking companies and maintenance shops still experience difficulty obtaining parts to repair current equipment. The average age of trucks and trailers in use continues to rise since the COVID pandemic, leading to increased needs during routine maintenance.

Operating costs continue to increase for trucking companies. Fuel costs, listed as the top industry concern in 2022 by the American Transportation Research Institute, remain high, with mixed reports on the pricing outlook for 2023. Companies have also experienced increases in general tolls for turnpikes, bridges and expressways, including new highway use fees. With the adoption of electric and alternative fuel vehicles, states may look to raise fuel taxes or adopt new fees for electric charging to maintain revenue. Despite the gradual easing of inflation rates, prices remain higher than average for most goods and services.

The lack of available truck parking continues to be a primary concern in the industry, ranking in the top five of the American Transportation Research Institute’s Top Industry Issues since 2015. Estimates based on the Federal Highway Administration 2019 Jason’s Law survey roughly equate one truck parking space for every 11 drivers. Truck drivers are forced to stop working early in order to secure a safe parking spot, leaving valuable driving hours on the table every day and delaying shipment times. Lack of truck parking also impacts driver retention and safety, with more drivers choosing to leave the industry rather than deal with the added stress of parking.

In 2022, bills were introduced by Congress to address concerns with commercial truck parking but failed to advance during the legislative session, including attempts to improve driver access to restroom facilities. A new truck parking bill has been introduced in the House of Representatives this year, and the trucking industry hopes to see its advancement, improving the work environment for our truck drivers.

America’s infrastructure is in a state of decline, rated an overall “C-” by the American Society of Civil Engineers 2021 Infrastructure Report Card, with 43% of America’s roadways listed in poor or mediocre condition. Trucks move approximately 72% of America’s freight, making America’s roadways a critical component of the supply chain. With the passage of the Bipartisan Infrastructure Law in November 2021, numerous grants have been awarded to begin a massive repair of roads, bridges and transit systems in the U.S. Poor infrastructure limits the transportation industry’s ability to move freight efficiently and safely, creating congested bottlenecks that result in 1.2 billion hours of lost productivity for trucking companies annually.

As transportation evolves, the country’s infrastructure must also be prepared to handle the widespread use of electric vehicles, making electric charging and hydrogen fueling stations readily accessible for commercial vehicles. Electric vehicles are also significantly heavier than their diesel counterparts, creating the need for additional regulatory changes on weight limits/restrictions to support interstate commerce. Without changes to weight limitations, carriers will need to reduce load size to compensate for the heavier equipment or face increased permit costs.

The transportation industry accounts for 27% of the total greenhouse gas emissions in the United States, the largest contributor among key sectors. Most fleets have embraced a more sustainable mindset aimed at improving operational efficiencies to ultimately reduce carbon emissions, such as avoiding deadhead miles, limiting idle time and maximizing fuel efficiency. These methods, while marginally beneficial, are not enough to produce widescale improvements on their own. The trucking industry needs to adopt innovative technology and equipment to make a significant reduction in carbon emissions, truly revolutionizing transportation as we know it. Customer demand is high for environmentally friendly services to create a sustainable supply chain and reduce their Scope 3 emissions.