Hurricanes and the Trucking Industry: The Lasting Impacts of Natural Disasters
With the recent tropical storm activity in southern USA, hurricanes and their effects on the trucking industry have been top of mind for fleet owners. Here’s what you need to know about hurricanes and their impact on trucking.
The Impact: Hurricanes And The Trucking Industry
Most tropical storms take place over the ocean and never make it to land. But, the ones that do make it to shore can wreak massive havoc and devastation as we’ve seen with Hurricanes Henry, Irma, Michael, and Maria to name a few.
The impact of hurricanes and natural disasters on the trucking industry is swift and brutal: Severe damage to roads, power outages, vehicle destruction, building collapse — and that’s just the beginning. Truck driver safety, load security, and timeliness of delivery are things that are top of mind for carriers.
The Short Term Effects: Natural Disasters And Trucking
Freight can be disrupted nation-wide for a month or more after a natural disaster. Trucks.com cites FTR’s 4 short-term impacts that can be expected after severe weather:
- Trucks idling while they wait for water to recede
- Disruption of regular freight due to the prioritization of relief and emergency supplies
- Heavy congestion on major roadways and freight loading areas slowing down operations, and
- Reduced productivity due to the disruption of the supply-chain demands
The effects of storms like Harvey and Irma impacted more than 10 percent of all US trucking during the weeks they hit. The rest of the country bounced back relatively quickly, but the damage continues to hamper trucking operations in the Gulf Coast region.
Emergency Trucking Services In The Wake Of A Hurricane
Let’s take a quick look at Hurricane Harvey: A state of emergency was called when this category 5 dumped a year’s worth of rain in only 5 days. That’s an estimated 27 trillion gallons of water. This resulted in 30,000 people needing shelter and beds, and 450,000 people needing FEMA disaster assistance. Enter emergency trucking services.
Truckers can be called into action at a moment’s notice with the declaration of the State of Emergency. Drivers may need to work extended hours to get emergency supplies to their destinations as quickly, and safely, as possible.
The Long Term View: Post Hurricane Effects on Trucking
Significant tropical storms that make landfall can also produce longer-lasting effects such as increased long-term shipping contract rates and increased spot pricing. FTR has done studies after Hurricane Katrina in 2005 and reports that “significant pricing effects” can be expected.
The annual nation pricing went up 7 points in the five months after Katrina, and there was a 22 percent year-over-year increase in spot pricing after the severe winter storms in 2014. Given the severity of the recent hurricanes, it’s safe to assume that these trends will repeat itself. Noel Perry, a Partner at FTR speculates that spot pricing could jump as much as 5 points in the coming weeks. It’s anyone’s best guess.
Be sure to check out our blog for more trucking industry news and trends from the team at Thunder Funding!
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