Top Factors Affecting Ground Transportation Costs This Spring

There are several factors affecting ground transportation costs this spring for shipping and logistics businesses. Today we will go over the biggest factors and list them below.

Truck Drivers

 There is a COVID-19-related shortage of truck drivers that is expected to get worse. Since there is strong pressure on shipping, shortages of drivers will likely increase prices just from simple supply and demand. How and why these shortages of drivers are occurring is not entirely clear. In some cases, it is because of the US/Canada cross-border vaccine requirements. In other cases it is that truck drivers are leaving their jobs to find better and higher-paying ones. There may be some overlap in the two reasons mentioned above for why truckers are leaving trucking.

Gasoline and Diesel Prices

The prices of gasoline and diesel are closely tied to the price of oil, and specifically West Texas Intermediate or WTI, a common reference price. Gasoline and diesel are products of fractional distillation that takes place at an oil refinery. In a simplistic explanation, oil goes in and a long list of products come out of the refinery including gasoline and diesel. As WTI climbs in price, all the products that come from oil also climb in price.

WTI has been steadily climbing in price since January due to the war in Ukraine. When gasoline and diesel rise with WTI, that will affect the cost of ground transportation. 

Weather

Severe weather, such as the flooding in Abbotsford in November, affects the price of ground transportation because of trucks being delayed on their normal routes, and also because of having to take routes around the disaster areas.

Your best hedge against any spring increases in ground transportation costs is an excellent shipping and logistics business that is aware of all the issues and potential expenses, and will work hard to mitigate them for clients.

Pacific Coast Distribution, based in Langley, BC, on the Lower Mainland can help you with your shipping and logistics needs. Call us at (877) 999-8489 if you need help moving your products quickly and efficiently. We work with each client individually to find the best and most efficient solution for their products.

Pacific Coast Distribution, LTD, is a family-owned transportation and logistics company, based in Langley, British Columbia, with 20 years of experience and a fleet of 50 trucks and a 60,000-square-foot warehouse.

If you have any questions about this article or would like to talk to us about your transportation and freight needs, give us a call at (877) 999-8489.