Yahoo Finance's Alexis Christoforous and Eric Fuller, U.S. Xpress CEO, discuss the impact of the coronavirus on the trucking industry.
ALEXIS CHRISTOFOROUS: The pandemic is reshaping a lot of different industries, including the trucking and transportation industry. Here to discuss that and more is the CEO of US Xpress, Eric Fuller.
Eric, thanks for being here today. You actually were out with earnings not long ago. Your company swung back to a profit in the latest quarter, though. I know results were not quite what Wall Street was expecting. But paint a picture for us right now. What does business look like right now for your truckers during this COVID-19 pandemic?
ERIC FULLER: Yeah, sure. Thanks for having me. If you look at our business, we're very sensitive to supply and demand. And on the demand side, we are seeing, in some customers and some segments, unprecedented demand. If you look at what I would call the mega-shippers, the big box retailers, some of them are seeing their volumes up as much as 20% or 30% on a year over year basis.
Now the problem is, there's very much of a have and have not economy. We have certain segments, whether it be industrial or manufacturing or even clothing retail, better off as much as 50% or 60%. And so when you look at it in aggregate, we're probably slightly up over last year. But the reality is, there are certain segments that are booming like we've never seen before and certain ones that are really in trouble and probably to the magnitude we've never seen before.
But if you look at our industry, supply is also a big factor. And the driver situation is probably deteriorating worse than we've seen in a long time. And it's really due to, in large part, to the pandemic. The fact that we were shut down for as much as four to eight weeks in certain markets, that kept that new influx of drivers that we typically come into the industry from happening because many of the schools were closed.
And so that's really kind of created a deficit of available truck drivers in the market. And we estimate that could be as less than-- or up to 150 or 200,000 less drivers in the market than there was just nine months ago.
ALEXIS CHRISTOFOROUS: Wow, so are you actively looking to hire right now, Eric?
ERIC FULLER: Every day. We're constantly looking to hire. Now part of it, because we're in an industry where turnover can be as high as 100% at times, so they're constantly trying to hire. But we are looking to grow, as are I think every other trucking company out there because there's a lot of opportunities in the market. The problem is finding qualified drivers.
ALEXIS CHRISTOFOROUS: And to that end, you actually started a college program called Full Ride. And you started that a couple of years ago. And you announced the first graduates of your Full Ride program. Just give us an overview of what that is and what does it mean for folks who want to break into this industry.
ERIC FULLER: Right, we've had this problem with drivers for a long period of time. And so one of the issues within the industry is we've always focused on what I would call a career truck driver and tried to bring people in that were going to be in it for the long haul. And that's great, but if you look at the nature of the job, it is not really conducive for a lot of people to have families because they're out on the road for, sometimes, three to four weeks at a time.
And so we looked at maybe there was an opportunity to take a page out of the military and have people come in, work in the industry for three to four years. We could pay for their college. They could even get a graduate degree during that time if they wanted to. And then they can go off into other careers.
And so we started this program in 2018. We just had our two first graduates I think in the last month. And so we're-- this is a program that I think is getting some traction. I think we currently have 215 drivers enrolled. And it's something that I think that we can bring people in. And it doesn't necessarily have to be a 40-year career. We can bring people in for three to four years, and this is a way for people to further themselves, further their education.
ALEXIS CHRISTOFOROUS: I want to talk a moment about your digital fleet because I think that's where you really see the growth happening, you know, long term. Has the pandemic up ended your rollout of that fleet called Variant, and how are things looking there?
ERIC FULLER: Yeah, so we were intending on rolling it out in March, and obviously, that changed things a little bit. It probably pushed us back about three months. But our philosophy was to take technology that we saw coming out of Silicon Valley, venture capital, that was being applied in our industry, but not necessarily in our vertical, and apply that to our business model. And essentially recreate our operating model based off of technology, automation, optimization, machine learning.
And we now have over 600 trucks operating within this division, which is almost 10% of our company at this point. And so it's really based off the principle that we can highly automate and optimize a lot of the manual work and manual touchpoints that exist in our industry. And we can get a better response, a better outcome by automating and optimizing to a high level.
ALEXIS CHRISTOFOROUS: Now before we let you go, how are you keeping your drivers safe right now? And especially we've got the colder months upon us. A lot of these truckers are going to be out on the road at these truck stops. How are you keeping them safe, socially distant, et cetera?
ERIC FULLER: Yeah, unfortunately, it's one of those jobs where they are interacting with people. So we're trying to provide PPEs. We're trying to constantly communicate about things that they can do, whether it be social distancing, whether there's other ways that we can-- the drivers can kind of keep themselves safe out on the road.
You know, one of the issues is, obviously, drivers are having to eat out on the road. So we're trying to give them tips and tools on maybe how they could create healthy meals in the truck so they don't have to go and sit at a truck stop and eat there.
So there's a lot of things that we can do-- just try to be a little more creative. And the big part for us is communicate that out to our workforce and try to give them some insight and things that they can do to keep themselves healthy and safe.
ALEXIS CHRISTOFOROUS: Yeah, well, good luck with all your efforts. To you and your truck driver, stay safe. Eric Fuller, US Xpress CEO, thanks for being with us today.
ERIC FULLER: All right, thank you, Alexis.