Logistics Viewpoints: Transportation in the Time of a Pandemic
This story is written by ElMarie Hugo, Senior Director, 3PL, Distribution & Logistics Industry Strategy at Blue Yonder. The story originally appeared in Logistics Viewpoints on May 12, 2020. Excerpts from the story below. To see the full story visit LogisticsViewpoints.com.
In the wake of the COVID-19 pandemic, the long-haul transportation industry has been tested daily. The biggest issue? Fluctuations in supply and demand. Spot loads quadrupled in the last month with outbound tender volumes at their highest since 2018. In April, freight volumes increased from 100,000 loads per weekday to 150,000 loads at its peak, loads remained consistently above 130,000 each day early in the month. Volumes have since cooled; however, volatility prevails as manufacturing in China and the rest of Asia normalizing and we expect to see a surge of supply into the U.S. distribution networks later in 2020.
Although the pandemic amplified the presence of slack or waste in the system, volatility is not new to this market and it is not expected to change. Price and capacity volatility in this market are recurring themes, in late 2017, rates in the trucking industry skyrocketed, with trucking companies not being able to honor contractual rates/commitments resulting in a 30% increase in spot market prices.
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