Addressing Capacity Shortages in European Linehaul Transport

A 2024 report by the International Road Transport Union (IRU) asserts that Europe is confronted with a shortage of approximately 426,000 drivers, with the gap widening as older workers retire and fewer young recruits enter the sector. This driver shortage puts significant strain on the line haul network, the infrastructure and system responsible for long-distance freight transportation across Europe. The current driver shortage can impact your ability to secure cost-effective, reliable transportation, leading to capacity shortages that affect both shippers and transport companies.

What is Causing Capacity Shortages?

Capacity shortage is a result of an imbalanced demand and supply of transport capacity. There can be many reasons for capacity shortage, such as environmental causes, infrastructure shortages, and unexpected absences. These shortages can impact different roles within the supply chain, from planners to drivers and warehouse staff.

Let’s look at some factors causing capacity shortage:

Driver Shortage

Europe’s trucking industry is 426,000 drivers short – that’s 10% of total demand. The result? Burnt-out drivers working endless hours away from family, delayed shipments, and rising costs across the supply chain. For every driver lost, capacity is reduced.

Natural Disasters

Rainstorms and snow pileup are common occurrences, affecting the ability of drivers to get to their destination on time. They also create the need for diversions of emergency supplies. Diverting drivers to troubled areas adds to the capacity shortage because normal transportation patterns are interrupted. 

Increased Regulations

Increased regulations directly contribute to capacity shortage, making the industry harder to operate and inhibiting capacity growth. Government regulations control factors such as how long drivers can work, and ultimately how carriers function.

The ‘Amazon Effect’

Despite Amazon having its own logistics network, they’ve set the bar for how other shippers should function. Amazon Prime’s free, two-day shipping has set the standard, so other shippers have had to decrease transit times without increasing costs. This sucks up available capacity, leading to capacity shortages.

Increased Costs to Carriers

Sometimes carriers can cause capacity shortage. When carrier profits decrease due to deadheads, driver delays, and other inefficiencies, they could try to recover losses by reducing fleets. 

As seen above, there are a lot of factors causing capacity shortages. It’s prudent to know the current market to be proactive instead of reactive, as capacity continues to reduce.

Impact of Capacity Shortage on the Supply Chain

Capacity shortages have impacted transport and operational costs as they negatively influence service levels. These shortages also reduce overall performance and operational efficiency, leading to delays and disruptions in supply chain operations.

Let’s now look at the major challenges of capacity shortages in the supply chain.

1. High Fuel and Shipping Costs

For companies with operations relying heavily on freight logistics, capacity shortages can result in increased costs as transportation prices rise to compensate for a shrinking labor pool. Higher fuel consumption due to inefficient routes or underutilized capacity further drives up operational expenses. In addition, truckload freight shipping rates are impacted by other operational costs, such as vehicle maintenance, driver wages, and vehicle taxes, which directly affect available capacity.

By optimizing logistics operations and improving route planning, companies can achieve reduced trucking costs and enhance overall efficiency.

2. Downtime and Delays

Trucks frequently stand idle at warehouses during driver rest periods, leading to lower asset utilization. These delays negatively impact arrival times and extend the overall delivery duration, making it harder to meet tight deadlines. Besides increasing overall delivery time, it can also lead to issues with meeting tight deadlines.

3. Risk of Damage and Loss

Linehaul transport truck drivers who cover distances exceeding 400 kilometers often operate under time pressure and through unpredictable conditions. A reduced pool of experienced drivers raises the risk of improper loading or handling of goods. Both heavy pallets and small packages are among the goods transported that are at risk during capacity shortages, as improper handling or delays can affect a wide range of freight types.

In addition, longer wait times at depots and rest stops, combined with inconsistent route planning due to labor shortages, can increase exposure to cargo theft and spoilage — especially for high-value or temperature-sensitive freight. These risks not only incur financial losses but can also contribute to capacity shortages.

How to Address Capacity Shortage  in European Linehaul Transport

The freight capacity shortage has hit the European linehaul transport hard. For instance, thousands of drivers have left or retired from the industry, and most businesses are now seeing its implications on capacity.

As a shipper or an asset-leasing freight forwarder, adopting certain innovative strategies can help overcome tight capacity and ensure reliable, efficient, and cost-effective line haul and freight logistics operations. We encourage you to implement these strategies to proactively address capacity challenges and improve your transportation efficiency.

Positive Driver Relationships

The first option is to build loyal relationships with carriers. For instance, when a driver gets to you, you’re ready to load or unload their truck and provide access to clean restrooms, lunchrooms, and other helpful amenities. Carriers have so much negotiating power today that it’s critical to be known as a shipper or receiver who keeps their trucks moving and cares about driver well-being. Shippers should also focus on strengthening their core carrier programs and consolidating more shipment volumes into a core base of carriers, versus having many carriers that each get a small amount of freight.

Private and Dedicated Fleets

Dedicated trucking can cut supply chain variability through route expertise and consistent capacity.

Baton Transport provides customised, dedicated trucking solutions that address capacity shortages. One such solution is predictable schedules with our relay system. Our relay model breaks long routes into manageable segments, letting drivers return home daily while freight keeps moving non-stop. The outcome speaks for itself: 40-70% faster delivery times and happier, more productive drivers.

Mode Shift

Intermodal transportation helps alleviate capacity shortages by freeing up on-the-road truck capacity after your freight has been transitioned to the rail. This approach optimizes the strengths of each mode, reducing reliance on a single, potentially strained mode such as trucking, and enhancing overall capacity and reliability. 

3PL Support

Using a third-party logistics (3PL) provider is a less intensive way to ensure capacity. Most 3PLs maintain extensive carrier networks and relationships with other shippers that share capacity. With transportation management systems (TMS), a 3PL also has access to data on different freight markets, thousands of carrier loads per day, as well as provide proprietary insight on homogenised lanes and average rates for critical lanes. Beyond that, a 3PL will also handle any issues with contracted shippers, such as delays and cancelled loads. 

Transportation Management Systems (TMS)

TMS software gives you a better look at your whole operation. It provides real time visibility into shipments, allowing you to track freight movements and monitor delivery status as they happen. More visibility and planning with a TMS can help you handle capacity issues more easily. Seamless data exchange between your transportation management system (TMS) and the provider’s platform improves coordination and reduces manual work. TMS helps calculate the line haul charge by selecting the optimal route, ensuring cost-effective and efficient long-distance transportation. Providers that invest in automation and smart route planning can bring major efficiency gains and help reduce costs through better route planning.

Choosing the best linehaul transport service requires a balance of reliability, efficiency, flexibility, and trust. A strong linehaul transport service provider will not only deliver your goods, but they will also support your business growth, streamline your supply chain, and protect your brand reputation.

Let Baton Transport Help You Navigate the Transportation Capacity Shortage Crisis with Confidence

Capacity shortage can impact your ability to secure cost-effective and reliable transportation. From an aging workforce, poor asset utilization, ardous work detail, and fluctuating demand, the factors driving this shortage are varied and complex.

The good news is that the linehaul transport model isn’t just about moving freight from A to B. Baton Transport’s robust line haul services are supported by advanced technology, ensuring real-time visibility and operational control throughout the supply chain. Our line haul operations are a key component of our intricate network, connecting cities, even warehouses, depots, and hubs across Europe.

At Baton Transport, we break down extensive journeys into manageable segments to keep drivers motivated and loving their job. From home terminals to the final destination, each leg of the journey represents a distinct phase where our carriers take charge of the freight, ensuring a fluid transition and prompt delivery.

To know more, you can get in touch with Baton here.