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Risky Business

History of Trucking

By Shelly Benisch, CIC
Posted Oct 10th 2011 4:50AM

CIS_Logo_50_percent_of_size_8.jpg   Hi Everyone, I thought I'd circle back to the information gathered while John and I attended our respective Truck Insurance and Legal classes this past month. 

Anyone ever wondered how trucking GOT regulated and deregulated in the first place?  Interesting story...back in the 1930s when the country was struggling to break out of the great Depression there were only a small number of "Motor Carriers" authorized by the ICC (at $150,000 a pop) to operate as a "trucking for hire" entity.

Cutthroat competition and unsavory business practices that included monopoly pricing and safety issues triggered the Feds to pass the Motor Carrier Act of 1935 to bring trucks and buses under ICC control.  

This promise of "protection to the public" applied on all processed goods.  What are "processed" goods?  It means they regulated truckers hauling cucumbers, but not pickles...this is how farmers were historically exempt from trucking regulation.

As time went on the trucking industry cleaned up its own act on the "unsavory business practices", and like other industries such as Airlines in '78, it was "deregulated" so that more companies could BE Motor Carriers, and here's the results:

Before the motor carrier industry was initially deregulated by the Motor Carrier Act of 1980, there were fewer than 20,000 interstate motor carriers in the U.S.

By November 2009, there were more than 227,000 for-hire motor carriers on file with the U.S. Department of Transportation (DOT), with an additional 282,000 private fleets.

There were also 81,000 “other” interstate motor carriers according to the U.S. DOT. While this is a significant amount of trucking companies, the vast majority of them are small businesses, with 96 percent operating fewer than 20 trucks and nearly 88 percent operating six trucks or less.

...More next time, but for now, any wonder there's reputedly a shortage of drivers? 

Shelly Benisch, CIC w/ Commercial Insurance Solutions (CIS)


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