Carriers Find Accessorial Re-Negotiation Challenging
WINDSOR, CO — Forty-two percent of U.S. carriers expect their customers will resist re-negotiation of accessorials, according to Transport Capital Partners.
When compared, 50 percent of smaller carriers and 38 percent of larger carriers showed pessimism about accessorial. But carriers small and large were more positive about re-negotiating detention times and 43 percent expect to re-negotiate.
While re-negotiating detention times does not necessarily raise cash, it can make equipment more productive, TCP explained.
Despite the static accessorials, 54 percent of carriers said they are getting a decent rate of return.
“For the industry to thrive and not just survive, a large percentage of carriers must be making adequate rates of return to afford the investment in equipment and support services required by modern supply chains,” said Richard Mikes, TCP Partner.
Carriers are also not seeing improvement in credit availability and about 75 percent expect credit availability to stay the same.
“Credit availability and carrier profitability go hand–in-hand, both are essential to replace aging fleet assets and to grow capacity. Carriers with stronger profitability and cash flows will find credit available and affordable and will be better positioned to gain market share,” says Steven Dutro, a TCP Partner.