The world has adapted and survived various ups and downs over decades, however the COVID-19 pandemic is the biggest challenge for lives of people, the way we live and world economies. Current pandemic is creating more than just fear of catching the virus, it is impacting the commercial trucking industry severely. With all forms of transportation being affected from public transportation and travel to deliveries of goods, managing parts inventories, customer interactions or lack thereof, and even the skeleton work-crew scenarios what will the comeback look like?
We are seeing a new normal, now with more than two months into the COVID-19 outbreak in the US, one of social distancing mandates and who its affecting. Except for essential needs, manufacturing plants have shut down temporarily and it is unclear when manufacturing will bounce back, with the uncertainty around the virus’ spread and which business and consumer spending will be impacted. Manufacturing and freight slowdown will probably send orders and production for trucks and trailers into a downward spiral. Although some freight companies are experiencing a boom for selective productssuch as grocery stores, medical facilities etc., while many freight companies with regular routes to restaurants, hospitality businesses and more have come to a halt from business shut downs.
Trailer orders follow Class 8’s spiral down as carriers are nervous and wary about the virus. Orders placed in March have been deemed an absolute necessity for temporary needs. But in the coming months, a delay in replacing older trailers should be no surprise until the economy has stabilized. This will likely be a long waiting period while this wait-and-see situation unfolds.
The supply chain is suffering at present with the shutdown on orders engulfing not just the supplier states but also across Mexico and Canada, making it a tough time for OEMs to build vehicles, outside of the parts they had in production when the industry halted. Another change is the tightening of belts for inventory management. Most of the dealer and distributors are re-thinking their buying plans day to day. Some preferring to sell what’s on the shelves and keep their inventories thinned out rather than stocked up, and some others “bulking up” with a strategy of looking down the line to ensure later stability in case of temporary logistic or warehouse related closures. All these factors have the third quarter GDP and goods transport continuing at a depressed level by forecasters before potentially rising again by quarter four.
Some of these experiences may serve as good reminders for future reference, and even make us appreciate more all the different pieces that make this industry-puzzle work. Some of it may feel like over-reaction but we must respond and learn what works even if that changes week to week. All the safety guidelines painful or tedious as they may seem, are a must to get all of us to that light at the end of the quarantine tunnel. DuraBrake wishes and prays for the safety and wellbeing of our employees, customers, suppliers, transporters and our planet through this difficult phase. We are open now to serve you from home and warehouse with the help of the trucking industry. We look forward to effectively serving current and future customers by reopening offices shortly. Stay Safe Dear Readers.