The long-tail ramifications of the COVID-19 pandemic had been entrance and heart within the first two of Overdrive‘s “Niche Hauls” function studies of 2021, which probed difficulties and a few new alternatives within the markedly totally different intermodal and auto-hauling sectors, respectively. For this third installment in that collection, the image is much less decidedly combined by way of pandemic ramifications. In methods each direct and oblique, COVID has largely enhanced alternative for unbiased owner-operators in “energy solely” operations. That is, hauling with motor service authority and with out the need of bringing an owned trailer to the freight association.

While power-only preparations with massive carrier-affiliated brokerage divisions have been frequent for years, non-asset brokerages and shippers resembling Amazon are more and more stepping into the sport as a approach to extra seamlessly meet freight transportation wants and ship among the advantages of power-only enterprise fashions to contracted carriers. Those embrace detention discount with drop-and-hook freight alternatives, higher utilization for higher revenue, trailer possession price avoidance, and extra.

Parking ease is among the many highlights owner-operator Kenyette Godhigh-Bell sees for power-only operations on layover between masses, a profit additionally earmarked by a large variety of respondents to the latest Overdrive survey round power-only advantages and downsides.

Parking “is likely one of the greatest perks” of a power-only operation, she mentioned. Godhigh-Bell has tended to specialize within the area in and round Atlanta in latest instances, hauling principally for Amazon. The congested space’s few correct truck stops are fairly properly full most instances of the day, and positively within the evenings and in a single day. Bobtailing after a drop on the finish of her day, although, as she detailed in late November, “final night time I went to Chipotle and also you simply park within the parking zone with two areas. That is likely one of the enormous advantages, for me.”

Even as she spoke, she’d been sitting in Amazon’s overflow lot at a facility in Eastpoint, Georgia, with different bobtails, the place she had been for a 10-hour break. “I’ve extra mobility as a bobtail,” she mentioned. “You’re not as weighed down” as with a trailer. “You can get round.”

[Related: Report from a #parkingdesert]

The lot had “by default” turn out to be the no-trailer lot for owner-ops serving the ability, she added, given dearth of area throughout the metro space.

This and different advantages have attracted untold numbers of different new house owners to power-only methods. For some, there’s an attraction much like that of leasing, with power-only carriers having access to dispatch personnel, huge gas reductions and extra usually related to leasing to a big service. There’s an analogous relative ease of entry with out related trailer prices, but it is also attainable to strategy a power-only operation like an unbiased using the spot market waves (on a protracted upward swell in latest instances). Independents discover new freedom to leap between totally different brokers and their digital platforms, very unusual leased to a service.

All of those components have helped seed progress in power-only applications, whether or not at large-carrier-affiliated brokers or not.

A quick trip by the house between loads? It's made easier without an empty trailer in tow.A fast journey by the home between masses? It’s made simpler with out an empty trailer in tow.Younger digital brokers like Uber Freight (via Powerloop) and Convoy (Convoy Go), amongst others, have made huge strides in recent times in power-only alternatives, as an illustration.

“We’ve seen sturdy progress for Convoy Go” since program launch in 2019, mentioned Tito Hubert, Convoy product and engineering senior director. Growth has continued via the pandemic however front-line curiosity Hubert attributes much less to the pandemic’s provide chain-stress results than bedrock shipper (expanded, versatile capability) and service (entry to preloaded trailers) advantages. At as soon as, “we all know that drop-and-hook has turn out to be much more worthwhile to shippers through the pandemic because it helps create efficiencies at amenities which can be significantly vital throughout labor shortages and demand surges.”

With so many more recent choices in entrance of them, “from an owner-operator standpoint,” mentioned Trimble Industry Solutions Adviser Pete Covach, for some “it doesn’t make sense to personal a trailer” anymore. “Being capable of soar round and blend and match freight alternatives from totally different power-only apps offers the choice and alternative for the driving force to remain loaded” with minimal interruption.

And to be extra nimble between masses, as Godhigh-Bell identified.

Yet it isn’t amongst newer digital brokerage ops the place the biggest share of homeowners amongst Overdrive‘s power-only survey respondents have gained expertise. A tough third of owner-ops who’ve hauled power-only at any previous level reported hauling in a carrier-affiliated brokerage’s system.

Third-quarter 2021 earnings studies from a couple of of the publicly traded entities amongst these carriers/brokers illustrate the recent-history progress. Schneider reported its normal brokerage division revenues elevated 24% year-over-year “primarily because of the firm’s development of digital capabilities and Power Only service providing progress.” In a post-pandemic time interval through which few massive carriers grew by a considerable quantity given limitations on new truck builds, amongst different components, energy solely applications for unbiased haulers present “extra capability” to serve prospects, to make use of Schneider’s third-quarter report’s language.

[Related: Small fleets in the catbird seat for growth: For-hire carrier size over the pandemic period]

Even extra extreme limitations on trailer builds over the identical time interval, partially a results of the pandemic’s provide chain results, have served to deliver these small carriers to the place the trailers are, too. In its Q3 earnings report, Knight-Swift trumpeted its “fleet of over 60,000 trailers” as key attraction to continued progress in its massive brokerage division.

Large owner-operator fleet Landstar, additional, pointed to new adjustments to its classification of truck providers and gear sort with its Q3 earnings launch. For the primary time the corporate broke out “power-only, expedited, straight truck, cargo van and miscellaneous different truck transportation providers” in a class all its personal for its brokerage providers. That adopted massively elevated demand for all of these forms of operations, the corporate mentioned – a 92% enhance in complete income obtained in Q3 2021 versus the identical quarter in 2020.

Adam Wingfield, head of the Charlotte, North Carolina-headquartered Innovative Logistics Service owner-op and small fleet consultancy and a former owner-operator himself, believes a big proportion of latest service authorities filed since strict COVID lockdowns let up in summer time 2020 are prone to be power-only unbiased carriers at the moment. “We’re speaking about wherever between 80,000 and 100,000 single-truck energy solely carriers,” he mentioned, as a “protected assumption to make,” a part of the rationale for the demand strain on trailer builds. “The squeeze proper now could be on the supply of trailers – and the premium that it’s going to price to get into a type of trailers.”

The explosion of new carrier authorities over the pandemic period is evident in this chart from FTR Transportation Intelligence, showing monthly numbers from federal data through June of 2021. High monthly numbers have continued since then, noted Adam Wingfield of Innovative Logistics Group. 'Since July of 2020,' he said in November this year, 'more than 130,000 have gone active.' In the month of October alone, that included '10,000 plus new authorities.'The explosion of latest service authorities over the pandemic interval is obvious on this chart from FTR Transportation Intelligence, displaying month-to-month numbers from federal knowledge via June of 2021. High month-to-month numbers have continued since then, famous Adam Wingfield of Innovative Logistics Group. “Since July of 2020,” he mentioned in November this yr, “greater than 130,000 have gone lively.” In the month of October alone, that included “10,000 plus new authorities.”

[Related: Components delays plague trailer production, other news]

Frank Maly, director of business automobile transportation evaluation and analysis at ACT, underscored that evaluation. Maly mentioned ACT had seen some new business manufacturing capability beneath improvement late in 2021, but trailer “OEMs stay reticent to completely open their 2022 order-boards. We count on them to rigorously handle their order acceptance over the subsequent few quarters, as they proceed to face unusually lengthy backlog-to-build ratios.”

Price will increase, in the meantime, move via the trailer construct provide chain to the top consumer. “Many OEMs have had to re-negotiate pricing on previously accepted orders with fleets,” Maly said, “implementing either price changes or material surcharges during the year. Sometimes, given their extended backlogs, OEMs returned to their customers more than once for these adjustments, additional reasons for manufacturers’ current caution.”

Adam Wingfield of Innovative Logistics Group, pictured on the stage during his talk at the September SHE Trucking Expo.Adam Wingfield of Innovative Logistics Group, pictured on the stage throughout his discuss on the September SHE Trucking Expo.Wingfield’s advising new-owner and small-fleet purchasers with the assumption, nevertheless, that trailer builders will catch as much as high-demand pressures extra rapidly than truck makers, and earlier than later within the new yr, facilitating much more in the best way of power-only service as huge fleets proceed to lean on outdoors carriers to haul their freight beneath contract.

From a excessive degree, Wingfield sees power-only as a method for giant fleets to “facilitate extra capability” for his or her prospects with outdoors carriers placing the fleets’ massive trailer pool to work. “It’s a mannequin that’s rising this yr,” he reiterated.

Traditionally-non-asset-based brokerages more and more supply power-only alternatives to associate carriers, too. Large dealer C.H. Robinson is amongst them with its Power+ (or “energy plus”) program, through which collaborating carriers dedicate capability to a single or a number of entities among the many dealer’s shipper prospects.

“We’ve had some type of energy just for a long time,” mentioned C.H. Robinson North American Surface Transportation President Mac Pinkerton. Typically, previous types had been related to distinctive Robinson buyer conditions, the place a short-term drop-and-hook association crammed a specific want. About 5 years in the past, the corporate launched Power+, beginning out with “one important buyer,” Pinkerton added. Yet attracting prospects to it and carriers to take part for dependable freight from “a number of prospects in a lane or a geography” wasn’t within the playing cards instantly.

Pinkerton and firm drew the Power+ footprint down and “then began to rebuild it,” he mentioned, with that sort of enlargement in thoughts.

The explosion in numbers of latest small carriers with authority over the course of the pandemic, together with ballooning shipper curiosity in energy solely, has made far more attainable, Pinkerton mentioned. Looking again over the 12 months ending in November 2021, “carriers collaborating in that program have doubled. Shipments moved inside Power+ have tripled” over the identical time interval. Once, C.H. Robinson’s power-only masses had been only a few and much between. Now, Pinkerton estimates “excessive single digits” for a proportion of complete masses moved, and that is not together with port and different container drays, typically categorized by freight companies beneath the “energy solely” moniker.

The phenomenon driving all that power-only progress is a pandemic-inspired enhance in demand for what Pinkerton referred to as “provide and demand engineering. … We had the pre-COVID challenges in our business”: required digital logging gadgets and the hours of service limiting capability in new methods, “distinctive conditions with child boomers” retiring, and extra. “Then – bam! – the pandemic actually exacerbated these issues.”

With charges for freight on the rise throughout, the attractiveness of going unbiased for leased owner-operators went via the roof. “We’re seeing an enormous transition from being a part of a personal fleet or leased to a bigger firm to that owner-operator area,” Pinkerton mentioned.

[Related: ‘Driver shortage claims miss self-employment explosion]

Power-only applications like Power+ and so many others turn out to be a refuge for house owners like Godhigh-Bell, whose maiden voyage hauling with authority this yr got here at an enormous price for legal responsibility insurance coverage as a brand new service, slicing into what cash she might need put into shopping for a trailer. Reduction in detention with trailers loaded and able to go upon arrival permits for owner-ops with shut freight companions to maximise productiveness outdoors the same old hurry-up-and-wait dynamics that live-load-and-unload conditions can include. “Your means to maximise productiveness could be a enormous problem,” as Pinkerton put it.

Trimble Industry Solutions Adviser Pete Covach notes his firm has made huge strides in integrating trailer monitoring gadgets from quite a lot of electronics/comms suppliers to be interoperable inside a single transportation administration software program (TMS) system for shippers and different events implementing power-only options. Such options handle a ache level for owner-operators, too, lowering the app overload so many have felt hauling with a number of brokers and/or shippers. “Bringing issues again into that singular view” for any shipper permits visibility into the place the freight is, in the end, with none necessity to trouble the power-only service with downloading this or that monitoring app, Covach mentioned.

As operations get increasingly refined, it is a 1 + 1 = 3 kind of state of affairs for all events, mentioned Pinkerton. “If you may give that driver entry to a drop-and-hook, it maximizes hours utilization and maximizes yield on the property. For the client – it improves flexibility, and sitting beneath that’s the expertise functionality to offer them visibility into that freight” because it’s moved. “That’s the place scale issues, and the expertise to assist that scale. … The alternatives had been constructing pre-pandemic,” however COVID-inspired supply-chain pressures fast-tracked them.

It’s not simply the legions of latest carriers with authority who’re benefiting.

Wayne Timmons, co-owner together with his brother of Arkansas-based Timmons Transit, attributes a lot of the expansion the fleet has skilled since 2016 to involvement in Robinson’s Power+ program. Timmons’ father was trucking when Timmons was a teen with an oilfield specialised firm. “I grew up not liking trucking very a lot,” Timmons mentioned, on account. “I noticed it as a tough and rowdy enterprise. I mentioned we might by no means be in trucking. Well, watch out what you say.”

Wayne (left) and Shane Timmons of Arkansas-headquartered Timmons Transit. The company also has a terminal in Dallas, Texas.Wayne (left) and Shane Timmons of Arkansas-headquartered Timmons Transit. The firm additionally has a terminal in Dallas, Texas.

By the late Nineties, Timmons and his brother had been full-time small fleet house owners hauling freight, with a spotlight principally on buying direct prospects. In 2016, Timmons was working to anticipate the approaching ELD mandate, as “all people was looking for a greater approach to truck,” he mentioned. In collaboration with a big buyer of C.H. Robinson’s, Timmons Transit moved into the Power+ program in its very early days.

“Through the course of that we rolled into a number of different initiatives” contained in the Power+ system, Timmons mentioned, permitting the corporate to “are available in and work a lane or two out of a buyer that calls for one trailer pool,” somewhat than a number of from totally different small carriers. Serving its personal buyer wants for drop-hook options that method on the time was tough for Timmons given restricted trailer property itself. “There are numerous property tied up with these trailers” sitting at both finish of a lane, he added.

Several Power+ initiatives, too, contain prospects which can be “massive sufficient that they usually would not work with a service our dimension,” he mentioned. “They need someone to return in and deal with 90 to 100% of their freight.” C.H. Robinson has been in a position with such prospects to be the only contact level marshaling the forces of a number of smaller carriers to do exactly that.

Early on of their participation in this system, Timmons Transit stood at about 40-50 vehicles, although they’ve grown significantly in 5 years to 150 vehicles and round 600 owned trailers, round 40-50 of that are within the Power+ pool themselves. “There’s no denying the truth that it gave us a big alternative for progress” since 2016, he mentioned, estimating now that his principally leased owner-operator fleet (60%, in comparison with 40% firm vehicles) is carrying 20-30 Power+ masses behind its tractors on any given day. Many run intrastate in Texas, or Texas to Oklahoma and again, together with some quick hauls with a number of journeys each day.

All freight Timmons pulls via Power+, as with many (although not all) power-only operations, run in dry vans. Pinkerton famous vans are roughly 70% of the Power+ system, with flatbed and reefer accounting for the remaining 30%.

Timmons does do restricted flatbed work with round 10 owned trailers, too. Owner-operators on the fleet are paid based mostly on miles, by and huge, although round 10% of them run beneath proportion pay contracts on more difficult, multiple-stop hauls or with different specialised freight. —Alex Lockie contributed to this report

Stay tuned for the subsequent components of this collection: Relative ease of scaling up, different principal advantages of hauling power-only – challenges, too, in insurance coverage necessities, no management of trailer administration, extra.

Read extra within the long-running “Niche Hauls” collection by way of this hyperlink.