The market for highway transportation capacity is oversupplied, and the pressure on truck drivers to work is increasing
The Logistics Information Service Platform Branch of the China Federation of Logistics and Purchasing recently released an industry article analyzing that China's highway transportation capacity market is oversupplied and in a saturated state. The fierce competition and uncertainty in the freight market have increased the professional risks for drivers. Due to the impact of supply and demand, the income of drivers is under pressure. We urge all driver friends to assess and master the professional risks before entering the industry.
According to statistics from the Ministry of Transport, since 2017, China's total freight volume has been fluctuating upwards. In 2020, due to the impact of the epidemic, the annual freight volume reached a low point, but gradually rebounded from 2021. In 2023, the total freight volume exceeded that of 2018, reaching 55.706 billion tons. According to the financial reports released by two platforms, Manbang and Kuaidou Taxi, as well as data released on the official website of Huolala, the overall number of drivers on top freight platforms has been on the rise in the past three years. Based on the activity and registered driver numbers of the three enterprises, the average driver growth rate from 2021 to 2023 is about 20%, while the total freight volume growth rate in China during the same period was 5%, and the total road freight volume growth rate was only 3%, indicating that the growth rate of transportation capacity is higher than that of cargo sources.
According to the "2022 Survey Report on the Employment Status of Truck Drivers" released by the China Federation of Logistics and Purchasing, 70.39% of truck drivers reported an overall decrease in freight rates in 2022 compared to previous years, while only about 4% of truck drivers reported an increase in freight rates in 2022 compared to the previous year. From the perspective of freight rate changes alone, there has been no significant decrease in China's highway freight rates. From the perspective of drivers, the main reasons for the decrease in freight rates are as follows: first, the overall cost increase has led to a decrease in net income; second, the unstable supply channels have led to low price competition; third, nearly half of truck drivers have carried goods at prices lower than the transportation cost price.
The article believes that the rapid growth in the number of truck drivers has also led to more intense competition in the industry. Drivers need to put in more labor time in order to obtain disposable income that is on par with previous years. More than three-quarters (76.21%) of the surveyed truck drivers work an average of 8 hours or more per day, with overall high labor intensity, which indirectly leads to overcapacity. Therefore, from the driver's intuitive perception, although there are orders available, competition is fierce, overall income continues to decline, labor hours are too long, and income is far below expectations. With the development of digitalization in freight transportation, freight platforms have improved the efficiency of freight transportation. However, based on the current trend of the freight market, drivers are advised to fully understand the real situation of the freight market before entering the freight industry, make reasonable income expectations, and thus assess and grasp the risks of the industry.
