While transportation cost savings helped many companies hold margins steady over the past 2 years, the trend is now reversing sharply. Transportation analysts report global capacity growth at 6 – 7% versus the 10% growth forecast for demand. Slow-steaming and a continued shortage of containers have driven up costs as much as 150% for ocean freight from the lows of 2008. Carriers have already announced additional increases and are shifting the cost of chassis fleets to shippers in the form of new surcharges.
Space and equipment will also be at a premium as the U.S. tries to grow its way out of this recession through a combination of low interest rates, a weak dollar and an aggressive push to double exports in 5 years. In domestic markets, significant regulatory changes such as CSA 2011 could reduce the driver pool by as much as 10% in the first year. With a weak dollar, fuel costs may continue to increase and stronger economic growth could accelerate the impact. Shippers who shift to intermodal to mitigate the fuel increases will then face chronic container shortages.
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