Trucking in Canada - A Profile

Executive Summary

This report explains the characteristics that make trucking what it is today a dynamic, ever-changing, fast paced business and a vital component of every other industry in Canada.

Just in terms of sheer numbers, 672,000 large trucks demand attention. But, of course, it is the work these vehicles do that is really important. Over 400,000 of these trucks haul freight commercially and it is this movement of freight that pervades every facet of the economy. Virtually every product the consumer purchases at the retail level has been handled by a truck. Some are hauled by truck on four, five or more times before they reach the final consumer. Consider trucks hauling fertilizer, seed and other materials to the farm, the subsequent movement by truck of the grain to a feed mill, the movement of feed back to the farm, the movement of the livestock to the packers, the movement of the meat to a warehouse, and the final movement of meat and other goods to a retail store.

How can this importance be measured? This report provides several possibilities:

The for-hire industry had $13 billion in revenues in 1993 (for-hire carriers and couriers). Private trucking, which doesn't have 'revenues' per se, probably was a lot bigger; some estimates indicate it added over $20 billion in services to the economy.

There are 11,551 for-hire and courier companies, 37,568 owner-operators, and thousands more organizations--private truckers--operating trucks used to haul freight. There are still thousands more--farmers, utility companies, municipalities--that own trucks used for a variety of purposes.

There are 209,000 people working in the trucking industry, and this just counts those working for for-hire carriers, couriers and the largest private trucking operations. There are many more people, classified in the labour forces statistics as working in other sectors, that drive trucks as part of their employment, maintain trucks, make trucks, check trucks for safety compliance, sell truck parts or that provide services to the trucking industry.

For-hire carriers moved 173 million tonnes of freight in 1993 (large carriers only). A good guess is that there is as much as 400 million tonne of freight moved by all trucks over the highway in Canada every year.

The reasons why shippers value the services of the trucking industry are: i) the scope of the road network (almost everyone in Canada is connected), ii) the scheduling flexibility of trucking (compared to the fixed timetables of other modes), iii) the flexible pricing for the service required; and iv) the wide choice of service available from 11,551 companies, many of whom are carving out "niche" markets.

As a rough guess, large trucks account for 23 billion kilometres of travel, or about 9% of total vehicle-kilometres of travel in Canada.

To travel this far, trucks use 9 to 10 billion litres of diesel fuel every year (plus an unknown amount of gasoline and propane). Trucks today, however, are far more fuel efficient than trucks ten or twenty years ago. In 1975, a typical load of a little over 20 tonne could be handled for about 36.1 litres of fuel per thousand tonne-kilometre. Today, a typical load of 30 tonne (trucks are larger now) can be handled for about 13.3 litres per thousand tonne-kilometres. And this only is considering 'typical' loads. There are a lot of big trucks that do considerably better than this.

There are $2.7 billion in transportation services by Canadian-based for-hire carriers and couriers across the Canada-United States border. Revenues earned on this crossborder traffic have been growing at an annual rate of 12.6% since 1980 ;much faster than revenues on domestic business.

Trucks handle over half of all of Canada's trade as measured by the value of the commodities. The total value of trade carried by trucks across the Canada-United States border was $218 billion in 1994, two-thirds of the total. No wonder there are close to ten million truck trips a year back and forth across the border.

The trucking industry (for-hire carriers and couriers) account for one out of every three dollars spent on commercial, for-hire transportation in Canada (this is both freight and passenger transportation).

Another estimate, considering private trucking as well as for-hire, suggests that trucking accounts for 47% of all commercial passenger and freight transportation in the country.

For-hire trucks account for 29% of the transport component of Canada's gross domestic product.

A recent estimate puts the total level of taxation of the trucking industry at 13.5% of revenues. A rough extrapolation from this indicates that highway tractors generate $30,000 to $40,000 in taxes every year and this does not take into account the taxes paid by the person driving that truck.

Every job created in the for-hire trucking industry creates 0.7 jobs somewhere else; every dollar of output adds $0.69 in sales to some other industry; and every dollar of GDP (value added) creates another $0.73 in GDP for other industries.

The total economy over the last three decades has grown at an average annual rate of 3.8%. For-hire trucking has grown at an average annual rate of 4.2% ;faster than airlines, shipping companies, railways, bus operations and urban transit.

From: Trucking in Canada: A Profile Canadian Trucking Research Institute, 1998.

The complete profile is available from the Canadian Trucking Alliance or any one of the provincial trucking associations.

Trucking and Related Associations