The trucking industry can expect some capacity restraints by year end, along with some driver shortages, according to the recent State of Logistics Report

, released by the Council of Supply Chain Management Professionals.

In the Penske Logistics-sponsored report, author Rosalyn Wilson says the trucking industry will be short about 400,000 drivers by next year. Wilson says many drivers came into the industry from other sectors during the economic downturn, particularly construction. Now, they'll likely head back into their previous occupations. In addition, about one in six drivers is age 55 or older and are coming up on retirement. Other factors contributing to a shortage include CSA 2010, reduction in driver pay during the recession, and a declining share of young new entrants, the report said.

"The lack of drivers will also slow the return of trucks to the marketplace," Wilson said.

Trucking has been the hardest hit sector in transportation, with a 20.3 percent drop in 2009. Truck tonnage was down 8.7 percent in 2009 on a volume basis, so abundant capacity was competing for fewer and fewer loads.

"Industry average lengths of haul are continuing their long term downward turn, while long-haul truck ton-miles have also fallen off," Wilson said. "These shifts are the result of higher usage of intermodal and more regionalization of distribution centers in response to higher fuel costs."

With not enough volumes to fill trucks, many trucking companies restructured their business by reducing their fleet size. In 2009, about 2,000 trucking companies went bankrupt, taking even more trucks off the roads. The report says another 2,000 companies will likely be forced out of business in 2010 because of higher operating costs and low demand for freight, according to research by Donald Broughton of Avondale Partners.

The good news is, freight volumes are starting to increase, with truck tonnage up over 6.5 percent in the last seven months, the report said.

"Truck shipments are picking up in most market segments and there are already reports of equipment shortages. Rates still have not taken off."

The report also pointed to trends in the overall U.S. business logistics system, which saw costs drop 18.2 percent in 2009, the largest decrease ever. As a percent of GDP, logistics costs were at 7.7 percent. Transportation costs fell 20.3 percent from 2008, while trucking costs declined 20.3 percent.

The "State of Logistics" video, below, includes brief commentary from Rick Blasgen, CSCMP president and CEO; Kevin Smith, former senior vice president of supply chain and logistics for CVS/pharmacy; and Rosalyn Wilson, State of Logistics Report author, who presents the report findings.

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