The changing face of the trucking industry was a hot topic along with the gig economy, need for proper enforcement and calls to fix loopholes in the system during the Truck Training Schools Association of Ontario’s sixth annual conference in Brampton, Ont., on July 27.
The trucking industry is two distinct businesses that are competing, said Mike McCarron, an entrepreneur and columnist for Today’s Trucking, with more than 39 years of trucking industry experience.
On one side are legacy carriers – older companies established by Canadian families who have been generational truckers – and on the other are newcomers, owned by immigrants and those newer to the industry.
During a session at the event, McCarron said legacy carriers are rapidly dwindling as newcomer carrier start-ups are off the charts. In 2021, 40 legacy carriers were sold in Canada.
While most legacy carriers haul loads for customers, they compete against 3PL and 4PL operators for business. Newer fleets haul broker loads and compete among themselves for business. McCarron noted that most legacy carriers have freight brokerage divisions that use newcomer carriers.
Spotty safety records
McCarron said while legacy carriers are the safest on the road and mostly pay drivers as per Canada Revenue Agency requirements, newcomer carriers have spotty safety according records to data, and are connected to driving schools that train candidates to pass the test, not to be safe .
Manan Gupta, general manager and publisher, Newcom South Asian Media Company, said there are shady carriers everywhere. New entrepreneurs are willing to take risks and there are also those looking for shortcuts to success. He added there are not enough checks in place and enforcement is lacking.
“The gig economy is not going anywhere. If something is happening, someone is allowing it to happen.”
Manan Gupta, Newcom South Asian Media Company
The trucking industry is in the spotlight due to the gig economy, where drivers want to be paid as contractors. Gupta said, “The gig economy is not going anywhere. If something is happening, someone is allowing it to happen, there are loopholes and people are using them. If the government and enforcement authorities know about it, why are they not plugging it? If they are not shutting it, who is to blame, why are you blaming end users and not talking about enforcement or policy makers?”
As legacy carriers struggle to fill seats and steal drivers from competitors, McCarron said newcomer carriers continue to attract people to their businesses from within their communities.
Immigrants filling gaps
Canadian-born millennials are shying away from the industry and new immigrants are filling the gap, Gupta noted. Many of the hundreds of thousands of foreign students who flock to Canada every year, enter the industry after finishing their studies because they see an opportunity to succeed here.
He added that immigrants who cannot find jobs in their fields as foreign credentials are not recognized, and are also attracted to trucking because it has fewer barriers. The industry is so popular, he said, that the Region of Peel in the GTA has about 100 truck driver training schools.
McCarron touched on the underbelly of truck training schools that give immigrants a bad name, where “one can get a license one day and be a trainer the next.”
Lack of enforcement
This is a product of the system that is allowing it to happen, Gupta countered. He called on the Ministry of Colleges and Universities to hire more inspectors and conduct more enforcement. “Why are they allowing more truck driving schools that operate as private career colleges. They should name and shame the bad schools and shut them down.”
A driver who should not be on the road and was trained by a shady school could kill someone, McCarron warned. The statistics are alarming. In the past five years fatalities involving trucks are up 2%, and per 100,000 miles traveled crashes are up 4% and injuries in crashes are up 6%. He added that this coincides with newcomer carriers and training school scams.
Gupta agreed that highway safety numbers are alarming and cited OPP data that revealed there was a 40% year over year increase in commercial motor vehicle collisions.
But, he added, the carriers involved are not known. He called out insurance companies to come clean. “Trucks involved in collisions must be insured by someone,” he said.
Gupta also took a swipe at politicians, noting their absence at the conference. “They should be here; data should be shared with them.” He said policymakers need to see the facts, or else solutions will not be found.
Looking toward the future, Gupta said in 10 years, the influx of new immigrants will continue, and resources are required to promote the ethics of the industry, or else things will return to square one.
McCarron said businesses that want to flourish will have to adapt to the changing of the guard. The issues will be the same, but a much different looking industry will be the trend going forward.