Number Crunch

Thousands of Trucking Businesses Stalled Out in 2020

The pandemic created a boom in e-commerce but only doom for small truckers

3,140: That’s how many U.S.-based trucking companies shut down last year, a 185% increase from the number of trucking company closures in 2019, according to the Wall Street Journal.

Given how many people stayed home and ordered everything from groceries to furniture online last year, you might expect a trucking boom.

The sad truth, the Journal reports, is that while Amazon may have massively expanded its own trucking operations in 2020, small trucking firms, with only one or a handful of trucks in their fleet, were hit hard by the pandemic. The average size of failed fleets in 2020 was 40% smaller than those that failed in 2019. The trucking businesses that closed tended to be those that stocked local businesses, picked up last-minute orders, and operated on razor-thin margins, leaving them little room to adapt to a sudden, major shift in demand patterns when the pandemic hit. Non-pandemic factors, such as rising insurance rates and the downturn in the oil and gas sector, also hurt some trucking fleets. The future looks brighter for the small trucking companies that were able to hang on until the fall, when demand started to pick up again, thanks to Covid-19 relief loans.

Maybe Uber should buy up some struggling trucking firms and roll out UberXXL?

For more Number Crunch, follow Marker Editors.