Impact of 9/11 on motor carrier industry and its long term effects
This assignment is being submitted on July 06, 2015
Introduction
The aftermath of September 11 attacks in US was far reaching over almost all forms of businesses. The severest harm experienced was over the concerned clientele of bigger organizations, working inland and offshore, and the potential security threat to US economy and security (Atwater, Gopalan, Lacioni & Hunt , 2010). Many new organizations were found to be directly hampered by any direct association with susceptible links and this notion also impeded the otherwise steady functioning of older players in the respective industries. The motor carrier industry was among frontrunners in this regard, as they were hit by a chain of detrimental impacts.
Response of the Motor carrier industry
Motor carriers were directly impacted in terms of increased shipping tenures and processing costs for inbound logistical functions in the country. The testimonial of the disastrous impact lies in the fact that around 11,000 motor carriers quitted the industry, owing to their failure to adapt with drastic changes in procedures and subsequent recurrent losses, spanned across the consecutive years after 9/11(Atwater, Gopalan, Lacioni & Hunt , 2010). Followed by the rising cost, there was also an equivalent surge in insurance costs, raised by significant levels (average 35% hike from earlier expenses) after excessive collateral damage in 9/11(Atwater, Gopalan, Lacioni & Hunt , 2010). Thus cumulatively above mentioned factors were the main causal for the pessimistic response from the entire motor carrier industry.
Long term impact
An earlier terrorism attempt, prior to 9/11, which was tried via motor carrier detonation, posed an equal threat from the motor carriers as anticipated from the aviation, after 9/11. Hence the most significant long term change in the industry was over government norms to tighten security check at all levels. Since, the transportation industry’s efficacy is strictly governed by time taken to deliver, the above move resulted in stern erosion of industry yield and most of the players failed to comply with them over the consecutive years and quitted. In 2007, a 9/11 commission act has laid over specific rules to make the stringent prerogatives from the state to maintain its motor carriers comply with the redefined security norms. The above features, coupled with rising costs of inland logistics, security checks and raised insurance terms, have shaped the long term effects over the motor carrier industry(Atwater, Gopalan, Lacioni & Hunt , 2010).
Conclusion
The inevitable norms and regulatory inclusion of safety and security over the pre-established processes have lead to serious setback to earlier yielding standards of the motor carrier industry. However, the newer players and established companies should now redesign their modus operandi to comply with the new norms and gain their productivity. It is for sure that in country like US, there can be no substitute for the stringent norms, owing to various terrorism threats and varying political relations, worldwide.
References
Atwater, C. ,Gopalan, R., Lancioni, R., & Hunt, J (2010). To change or not to change: how motor carriers responded following 9/11. Journal of business logsitics . Volume 31. Issue no. 2. pp 129-155.
