When trucking executive Harold Sumerford Jr. notices a decline in the demand for calcium carbonate, he says he is pretty sure that at least part of the economy may be faltering.
Sumerford, chief executive officer of J&M Tank Lines, based in Birmingham, oversees a fleet of 415 tractors and 720 tankers. He is second vice president of American Trucking Associations, the largest national trade association for the trucking industry. He says he thinks the trucking industry is a good indicator of the economy as a whole.
“Calcium carbonate out of Sylacauga would be a good example,” Sumerford says, noting that calcium carbonate is used to make building materials, limestone aggregate, is an ingredient in concrete, and is used in the metals industry and oil production.
Sumerford says he has used calcium carbonate production for years to gauge the overall economy, “especially when we see them starting to slow down. Say a roofing plant, when they quit taking calcium carbonate, we know they are not selling roofing, therefore the housing industry is slowing down. The whole trucking industry is a good indicator of the economy.”
In Alabama, the trucking industry has a lot of influence on the economy. It provides one of every 15 jobs in the state, more than 100,000, according to Mark Colson, president of the Alabama Trucking Association. Its complexity and stratification, along with heavy regulation, traffic congestion, crumbling infrastructure, a looming driver shortage and now the Covid-19 fallout, have the industry on edge.
“We have nearly 500 carriers and nearly 10,000 trucking companies located in Alabama. It is a major employer and an essential part of the supply chain,” Colson says.
In addition, the trucking companies are served by a wide range of supporting businesses, both large and small. And significantly, most Alabama communities depend exclusively on trucks to move their goods, which often means long, strange hours for a lot of drivers.
A post on the Alabama Truck Driving Facebook page shows a photo of an 18-wheeler with the caption, “The only people up at 3 a.m. are in love, lonely, drunk or truck drivers.”
“The trucking business is nimble, it is agile,” Colson says. “It is very responsive to needs, and that’s a good thing. Trucking is something that can give people hope. When people see trucks moving up and down the roads now, hopefully they see hope and action and things getting back to normal in the near future.”
The trucking business, however, is highly segmented, which adds to its complexity. In many cases some specialized carriers might be busy and other sectors are sitting empty somewhere.
For example, Sumerford says, “We run dry bulk and liquid tankers, predominantly dry bulk, and basically all the way from Texas all the way up to North Carolina. We haul a whole lot of powder materials.
“Right now we are holding our own. We’re doing fine. We’re in the tanker business. We’re seeing some hot spots, and construction is still good on highways and things like that. So that side of the business is good. Our food grade business is doing very good. The rest of it, with this virus going around, when somebody does have it or is sick with it, they have to shut a plant down for two or three days, and they have to bring it back up to speed. So every now and then we run across that, so all in all, we are a little bit under what we should be but not bad.”
Sumerford says the business “was pretty soft to start off with, but we were looking to gain traction by now. We normally do.” He says his business is seasonal and had a good spring.
Sumerford says he expects the Covid-19 to cause “a hangover kind of effect for a while when there’s not going to be anything to haul because of hoarded up food and everything else.”
Then there is R.E. Garrison Trucking in Cullman, where business is booming, says Shawn Nelson, vice president of safety and driver relations.
“We are a refrigerated carrier, so we haul a lot of food products, so we have actually been busy through this, because although restaurants close down, retail stores went nuts with everyone needing to fill their refrigerator. So the retail business has been booming for us.
“We haul a lot of protein, a lot of chicken and products like that that have just been flying off the shelves. It’s the craziest thing, but people got accustomed to eating out, and, when they closed all the restaurants, they all went to the grocery stores to stock up.”
Nelson says as some of the states start to allow restaurants to open on a limited basis, “we anticipate the restaurant part of our business to start growing again. It’s hard to manage, but we are working to handle that work load.” Garrison operates 750 tractors and 1,200 trailers that deliver all over the country.
At Boyd Brothers Transportation, President Chris Cooper says his business, like Sumerford’s and at Garrison, has been good so far this year. Boyd Brothers, headquartered in Clayton, is a flatbed and specialized company, and is part of Boyd Companies, which includes WTI Transport, Mid Seven Transport and Boyd Logistics.
He describes business as “very, very robust. I think it was because we were heading into a busy building season and there were some inventory shortages we were seeing throughout the entire network through March.
“Given the Covid-19 exposure, we have seen a slow-down over the last few weeks, but the business is still there.”
Boyd Brothers is a flatbed hauler and operates 1,000 trucks primarily throughout the eastern two-thirds of the country. “We haul a lot of pipe, a lot of steel, a lot of lumber, tubing, a lot of building materials,” Cooper says.
The economy and Covid-19 aside, the trucking industry also has been battling a public image problem, a driver shortage and rapidly rising insurance rates.
A survey last fall by VerizonConnect found more than two-thirds of those surveyed say they think commercial drivers are more focused on schedule than on safety and 81 percent say they have seen a commercial vehicle being operated in a dangerous manner.
“These days the two issues that are always the most important are the image of trucking, and right now we are shining. Prior to this, we had some challenges with trial attorneys saying we are not safe, and that is just blatantly untrue,” Colson says.
“The second issue that we really face is the work force,” he says. “We have jobs that pay so well. I mean, not only truck drivers but also diesel techs, fleet managers, logistics professionals, human resources, accounting, finance, the legal side of our business, the management side. There are diverse jobs ranging all over the map.” According to Ziprecruiter.com, the average base salary for a truck driver in Alabama is $56,935.
Meanwhile, Covid-19 has caused trucking companies to pay increased attention to driver and customer welfare and protection.
“We are doing this job when safety is always essential but personal sanitation and safety is even more so as far as the drivers and the shippers are concerned,” Colson says.
“Truckers are problem-solving people in a problem-solving industry, so if you give us good information and a little bit of time, we are going to figure it out. It is not a perfect world, but everyone is approaching each of those issues with the mentality of: How can we solve this problem.”
“Heroes of the Highway”
Cooper says one positive effect of the Covid-19 spread is that the public is developing a new respect and understanding of the trucking industry.
“The American Trucking Association, many years ago, had the America First, Trucking Moves America, Without Trucking America Stops — all those themes over the last 25 years — and quite often in everyday life trucking, transportation and logistics, the backbone of this country, is overshadowed and overlooked by just the business of life,” Cooper says.
“As things have slowed down, people understand it truly is essential, and it is refreshing and uplifting to everybody in the trucking business that everybody outside the trucking business who may have had a negative slant or has had a negative encounter with a truck — seeing these big blocks of steel that slow traffic down on the interstates — all of a sudden we have become the heroes of the highway. So it is refreshing to kind of get the tables turned.”
Sumerford says his company closely monitors the health and safety of the drivers. “We are sensitive to that, because drivers, they are heroes right now. There is a lot of uncertainty and they are on the road and interacting with people, and you don’t know if they are sick or not, so we spend a lot time with training how to stay safe.”
Some Place to Stop
“Our drivers are obviously on the front lines of this going from state to state,” says Nelson. Many states have restrictions on what you can do once you are there and after you arrive. Our customers put in restrictions for our drivers once they get to their facility — wearing masks, not going into the facility. They are having some hardships. When you get to a facility and you have been on the road for a while and you are not allowed to go into the facility, and we completely understand that, stuff like rest rooms and break rooms and the stuff you get accustomed to, is no longer available.
“We have a facility here in Cullman that was making the masks, and we bought 2,500, and those were given to our drivers, their families and our associates here at the office and their families, so that we could give these drivers as much protection as we could.
“We put in a lot of precautions into orientation, because, again, we bring people from all over the country in here, so we check their temperature before they are ever entered into the building. So, there are a lot of extra steps we are taking to try to protect our associates here and the drivers, too.”
Sumerford says his company also is protective of its drivers when they deal with shippers, the people at delivery points and when they return home.
“We are pretty proactive, and we tell people you have to let the drivers in the building to use your facilities or whatever, things of that nature. We have had a handful of drivers who thought they were sick, and we sanitize the trucks. There is a protocol we go through to make sure that the technicians and driver coming in behind him feels safe,” Sumerford says.
There also is the issue of truck stops and rest stops, Colson says.
“Truck stops are a big part of our industry. For example, in Pennsylvania, they shut down rest areas for about week, and it almost created a major crisis. Truckers have to have a place to rest, so they can do their jobs safely. We didn’t do that in Alabama. I was able to talk to our governor’s office and quickly got ahead of that issue, and they didn’t have any intention of doing that. That has been an issue right out of the gates — truckers finding a place to eat, a place to rest, a place to shower.
“Truck stops play a big role in our industry. They have become very innovative about finding ways to get food to truckers. So have chain restaurants, and private citizens have been great about getting food to truckers.”
Other steps have also been taken to keep trucks moving, Colson says. “Medical cards go along with licenses, so the truckers sometimes require a physical. There has been an extension when the physicals have expired during this period.”
Colson says an issue that might come up is testing for the Commercial Drivers License. “We are not taking any new CDL testing. We have paused that. That could be an issue, depending on how long this lasts, whether we need to figure out a way to let people safely take their CDL test. I have talked with the folks at the state level about that, and they are aware that other states are doing some innovative things. I don’t see it as major crisis yet, but we have to keep the supply chain healthy, and if we need new drivers coming on the scene, we may need to figure out a way to be testing for CDLs.”
Bumps in the Road
Looking ahead, all the trucking firms expect to find bumps in the road.
“We are really expecting the trucking industry to go through some pretty bad times in the next two to three months, just in general,” Sumerford says.
“I think you are going to see in the next six months, probably, several bankruptcies, especially with the insurance problem the industry has right now. Fourth quarter it may be back strong again hopefully.”
Sumerford says trucking insurance rates are going up “probably 20 percent right now and will probably go up a good bit more. We are seeing some $100-, $200-million verdicts.
“I think the next six months are going to be very, very serious, especially if this Covid-19 thing drags on through the summer.”
Nelson agrees. “The insurance issue has been a problem for several carriers for the past three or four years,” adding that a number of smaller trucking firms have expressed interest in becoming affiliated with Garrison in an effort to ease insurance increases.
There also is the question of driver supply. The American Trucking Associations last year said the industry needed nearly 61,000 new drivers then and that the industry could be just short of 100,000 drivers in three years.
At Garrison, Nelson says the company has been the beneficiary of driver layoffs caused by the Covid-19 in other segments of the industry. “The flatbed industry is struggling right now, and some of the tanker positions have been laid off, so those drivers have been coming over to the refrigerated carriers.”
But the good news for the trucking industry is traffic flow. Colson says with social distancing and fewer cars on the road, there is less congestion and truckers have an easier time getting around.
Sumerford agrees. “If you go back and look at it, every single thing you own either came to you all the way or part of the way by truck. It is easier to do your job now as a truck driver because there are not as many vehicles on the road. We don’t have the congestion issues.”
Bill Gerdes is a freelance contributor to Business Alabama. He is based in Hoover.