LTL’s Capacity Crunch: Why is it Happening & How Is OD Responding?

Senior VP of Operations
Dave Bates

It is remarkable just how much conditions in the less-than-truckload (LTL) industry have changed in the last year. Carriers have gone from too little freight – and numerous new safety precautions to deliver it – to so much freight that docks are working 24/7 to avoid falling behind.

And yet, the underlying challenges LTL shippers must contend with have not changed a lot. A study Old Dominion Freight Line (OD) conducted with IHS Markit in September 2020 found that during the pandemic, problems such as lengthening and delayed transit times, missed pickups and deliveries, and customer service failures plagued shippers and carriers. In fact, more than 50% of respondents said they faced transit time delays of at least two days.

With conditions changing – restrictions easing and demand continuing to grow – headaches around delays and customer service challenges aren’t going anywhere. The important question is what’s causing the backup, and how are carriers continuing to adapt operations?

It’s a (supply) chain reaction.

We saw the first signs of the capacity crunch around the end of Q3 2020. States began to reopen, and consumer optimism was reflected in growing household spending, up 1.4% in September 2020 to close out a strong quarter. In fact, in Q4 – typically a quarter with less demand for freight – OD exceeded pre-pandemic business levels.

Responding to the capacity crunch takes a significant investment in the freight network – to increase both personnel and physical space. These investments need to happen over time and cannot simply happen overnight.

Dave Bates
Senior VP of Operations

Dave Bates

Need More Information?

Contact us by email or simply call 1-800-235-5569 to be connected to an Old Dominion customer service representative.