Fleeting's COVID-19 Response
Hello Everyone,
Hope this message finds you and your family well. As you are all actively aware, the spread of the Coronavirus disease (COVID-19) has had a devastating impact on the world. Businesses of all sizes and industries have been tremendously affected and the logistics space has not been any different. We’ve seen a slow down across the entire industry, from shippers who typically work with Chinese companies, to motor carriers who manage and deliver loads. As we go into more depth below, all parts of the ecosystem have been tremendously affected.
As a business, we’ve implemented the necessary precautions to ensure the safety of our team and operations. My team and I are committed to helping drivers and customers weather this unfortunate storm, and we know we are in a great position to ensure continued service for our stakeholders. Our thoughts and prayers go out to all those affected by the situation and are standing by with our support.
With that said, we do believe this is an opportunity for Fleeting to bring together what has been a fragmented market. The industry is in a state of flux and will continue down that path for a while but by building a decentralized platform we hope to be the calm in whatever storm the trucking industry sees.
Below you’ll find a breakdown of the trucking sectors we believe will be most affected, and how we will tackle the market in the coming weeks and months.
I wish you and your family all the best.
- Pierre Laguerre, CEO @Fleeting
STATE OF TRUCKING
No one can really predict how long the coronavirus will last but it's clear that it has been having a dramatic impact on the five distinct players that make up the Trucking Logistics market - we break this down into, Shippers, Brokers Motor Carriers, Owner Operators & Drivers.
Shippers Imapcted - Shippers are in a good position to “weather the storm” as they typically have cash reserves on hand but there is no doubt that this will change how shippers do business moving forward with other industry stakeholders like motor carriers, brokers, and owner-operators.
Fleeting solution - Through our pool of vetted drivers and owner-operators, we are poised to provide flexible on-demand solutions directly to shippers to keep their freight moving should the middle layers of the industry experience turmoil.
Brokers Impacted - The need to broker loads between shippers and owner-operators could decrease as international supply chain issues limit supply to domestic shippers. Brokers are also subject to consumer demand, and the effects of quarantines around the world.
Fleeting solution - While we do not have a direct solution to help brokers, we can step in to support the industry as a whole by being more nimble and offering lower rates to shippers affected by the global supply chain. How? Fleeting is working to partner with truck leasing companies such as Ryder, Penske, Volvo, Mack, etc. to provide flexible, on-demand trucking capacity directly to shippers. This will also increase the amount of available work for drivers who have been laid off by trucking companies.
Motor Carriers Impacted -Due to a likely slowdown and re-organization originating from shippers, motor carriers will see a slowdown on demand to carry loads, this, in turn, will affect cash flow and hinder them from hiring and maintaining a workforce of full-time drivers. These carriers will likely turn to hiring drivers on an as-needed basis. Since most trucking companies operate on slim margins, many are at risk of becoming insolvent.
Fleeting solution - To ensure motor carriers are able to maintain their operations, Fleeting will provide them a consistent driver pool, and give them the ability to access part-time drivers on-demand. We will continue to work alongside motor carriers to help them keep their promises to their shipping partners. We’ll also be there to ensure they have a smooth transition from employing a full-time driving team to one of a part-time, on-demand nature.
Owner Operators Impacted - Each of these operators owns physical assets, and with each asset comes with the responsibility to service their trucks, manage trip-related expenses, and to pay the note on the truck. As the situation intensifies, brokers and shippers will begin to reduce “load rates” they pay to owner-operators in order to maximize their own cash flow. As a result, owner-operators will begin to see their margins reduced.
Fleeting Solution - The nature of Fleetings decentralized setup will allow owner-operators to work directly with brokers and shippers without taking on the liability of owning an asset, relieving them of the stress of maintaining their own assets and allowing them to lower their insurance obligations.
Drivers Impacted - During this time of instability, we believe there will be a shift from full-time to part-time work. Drivers are expected to see less work from the trucking companies they are signed to and will seek to supplement their schedules with part-time shifts.
Fleeting solution - Fleeting will help drivers find supplemental work from our motor carrier partners, allowing them to continue to maximize their hours, while the global situation continues. In order to provide these drivers with sufficient work opportunities in the coming months, we’ll be partnering with companies across food/beverage, government organizations such as FEMA, and other emergency aid groups, as they will all need to ramp up operations during this time.