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Supply Chain Solutions: Many contributing factors to disruptions

While truck driver issues are the tip of the capacity shortage iceberg, there are several other contributors lurking below the waterline. It is imperative to navigate around them as well.

These challenges include well-intentioned state and federal regulations, which have had a negative impact on service availability.

Examples include California’s independent contractor legislation, which will make it very difficult for motor carriers to use owner-operators to handle fluctuations in supply and demand, and changes in safety-related hours of service rules, which lead to fleet productivity losses.

Parts and equipment
The trucking industry is not immune to the supply chain disruptions harming other economic sectors.

Much like the automotive industry, the semiconductor shortage is delaying production and delivery of new tractor trailers. Critical service parts are scarce and forcing drivers off the road while they wait for repairs.

Trailer manufacturers can’t fulfill orders fast enough to satisfy industry needs, so the net result is limited growth of capacity at a time when it is sorely needed.

“There’s been a very high number of Class 8 trucks produced and record-breaking prices on used trucks, although there is a slowdown because of the chip shortage and a lack of parts,” says Kenny Lund, executive vice president at Allen Lund Company, LLC, BB #:107465 headquartered in La Canada, CA.

Ryan Carter, president of Scotlynn USA Division Inc. BB #:263408 and Scotlynn Transport LLC,
Says he has firsthand experience with these equipment issues.

“We have an order for 100 new trucks that won’t be delivered until Q1 of 2023. We can’t get any in 2022 simply because the manufacturers don’t have chips or various components.”

“As far as the current fleets out there,” Carter notes, “there are availability issues with depth sensors and fuel sensors. When they fail, the truck goes down for six to eight weeks while we wait for replacement sensors. It’s a real tragedy.”

Product shifts
The pandemic-driven shift in demand from services to tangible goods adds to trucking capacity issues.
After a brief and tumultuous decline in spending in 2020, spending resumed at a strong pace and the economy began a rapid recovery.

There is now more freight to move than prior to the pandemic but little additional capacity available due to delays in new equipment deployment. Until this equipment is put on the road to ensure that companies get inventory levels back to normal, demand-driven capacity challenges will continue.

This is an excerpt from the Supply Chain Solutions department in the January/February 2022 issue of Produce Blueprints Magazine. Click here to read the whole issue. 

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Dr. Brian Gibson is executive director of Auburn University’s Center for Supply Chain Innovation and a former logistics manager.