Carriers and industry vendors have indicated that things are improving, with capacity tightening in February, according to the observations of Transport Capital Partners at the Truckload Carriers Association (TCA) Annual Meeting in Las Vegas last week.


According to TCP, carriers expect this month to continue to improve as inventory is moved. While carriers are uncertain about April, they expect May to be very strong.

"The three factors of volumes, rates and driver shortages are setting the industry up for winning an 'inverse perfect storm,' where carriers will finally be able to post much-needed earnings," TCP said.

Last week, Internet Truckstop's Market Demand Index rose above 7, an indication that pricing leverage has shifted in favor of the motor carrier for the first time since July 2008. According to TCP's recent Business Expectations Survey, 10 percent of carriers reported that they have been able to selectively raise some rates.

TCP also had discussions with carriers that are looking to hire drivers to fill parked trucks. Such fleets are ramping up their recruiting efforts and starting to advertise more. However, some told TCP that they are having problems finding drivers because of extended unemployment benefits at high rates.

"Although carriers' optimism was widespread, lenders appear to be more cautious, TCP said. "From both lenders and carriers, we heard concerns that financing fleet equipment replacements will be a challenge for the industry, with very few carriers seeking to expand their fleets."

TCP's survey found that carriers are still wary about adding equipment, as fleets will be facing increased credit standards and tougher lending terms from banks. Fleets are also concerned about who will supply financing for owner-operators to replace older trucks.

At TCA, carriers also expressed concern about the impact of the Federal Motor Carrier Safety Administration's Comprehensive Safety Analysis 2010, or CSA 2010. According to TCP's observations, fleets will be hit by violations, such as non-out of service violations, that were rarely monitored before. In addition, drivers will be more highly scrutinized under the program. "These drivers will probably not only be dismissed by their current employers but also will not be hired by any prospective employers because the drivers' records follow them for three years, thus putting their careers at risk," TCP said.