Moving money, not metal: Why finished vehicle logistics has a workforce problem it can't hire its way out of

When Ford ended its contract with Jack Cooper early in 2025, and General Motors followed weeks later, the collapse of a carrier that had hauled GM's vehicles for close to a century read like an isolated incident. Around 2,500 jobs went with it, most of them held by Teamsters, and transportation advisers at the investment firm Stifel warned the wind-down could prove more consequential than the 2023 demise of LTL carrier Yellow Freight. Eighteen months on, it looks less like an aberration and more like an early indication of what was to come.

Across the finished vehicle logistics network in 2026, the same pressure that felled Jack Cooper – carriers locked into rates they can no longer sustain while the labour they depend on drifts away – are now affecting much of the sector. Auto haulers are turning back work. OEMs are watching the balance of their flows tip from contract to spot. And the driver pool that FVL has always drawn on is being squeezed simultaneously by demographics, enforcement and economics.

The American Trucking Associations (ATA) puts the national driver shortfall at roughly 80,000-82,000 in 2026, and chief economist Bob Costello has warned it could approach 160,000 within the decade if current trends hold. Revised Bureau of Labor Statistics data show the industry shed around 122,000 positions from its late-2022 peak – some 50,000 more than previously understood – so the freight recovery is arriving into a labour market that cannot match it. But the raw number, as this article will argue, is the least useful way to understand what is happening to the finished-vehicle logistics workforce.

Why the shortage is becoming structural

Driver shortages are not new to auto hauling; they have ebbed and flowed with the freight cycle for decades. What has changed in 2026 is that several independent pressures have aligned, and each one deepens the others.

The trigger is regulatory. On March 16, 2026, the Federal Motor Carrier Safety Administration's (FMCSA) final rule on non-domiciled commercial driver's licences took effect, restricting eligibility to holders of H-2A, H-2B and E-2 visas and excluding most others – including workers on employment-authorisation documents, Temporary Protected Status, DACA and asylum claims. FMCSA, which cited 17 crashes and 30 deaths in 2025 involving non-domiciled CDL holders who would not qualify under the new standard, estimates around 194,000 current holders could eventually be affected as their credentials come up for renewal. States must pause issuance where they cannot comply and downgrade licences within 30 days if lawful status lapses. A parallel executive order on English-language proficiency is placing non-compliant drivers out of service across state lines, and a Senate bill, informally "Dalilah's Law", would make the restrictions permanent.

The effect at ground level is being felt on both sides. International Motors' head of inbound and finished-vehicle logistics, Tony Stinza, told the Finished Vehicle Logistics North America conference in April that enforcement is "pulling drivers out at the same time we're trying to get people back in", with carriers now running formal English-training and compliance programmes for the B1 drivers they still have. Several operators report trucks being taken out of service over driver-credential problems even when the vehicle itself is fully compliant.

Layered on top is a liability shock. In Montgomery v. Caribe Transport II on May 14, 2026, a Supreme Court held that the Federal Aviation Administration Authorization Act does not pre-empt state-law negligent-selection claims against freight brokers, because such claims fall within the statute's safety exception. The decision – which arose from a carrier-selection claim against C.H. Robinson – strips away a federal-pre-emption defence that freight brokers, and derivatively shippers, had relied on. Plaintiffs may therefore pursue negligent-selection claims directly against brokers, increasing litigation exposure for the brokerage sector. For FVL, the practical effect has been tighter carrier-vetting requirements and higher insurance expectations for smaller subcontractors, reducing the pool of carriers considered commercially acceptable at a time when market capacity is already constrained.

Labour and demographics

Alongside the acute pressures seen in 2026 is a longer-term demographic challenge affecting the wider trucking industry. The average US truck driver is around 46 years old, while the average new entrant is about 35, according to figures from ATA in 2019. The ATA also estimated the industry would need to hire roughly 1.1 million drivers over the decade – about 110,000 a year – to replace retirees and keep pace with economic growth. Turnover at large truckload fleets still runs at 90-95%, and around a third of new hires quit inside 90 days, according to PLS Logistics.

Auto hauling wears this demographic squeeze more visibly than most, perhaps because its work is harder and more skilled than straight freight – inspecting vehicles, loading and securing them safely, operating specialised deck equipment, and working outdoors in all weather. Jeremy White, president of operations at Autos in Motion, summed up the industry's demographic challenge. “My biggest frustration is I've got 67 to 70-year-old men filling out applications, and I've got two drivers under 30," he said at Automotive Logistics’ FVL conference this year. To keep experienced drivers, White said the company has introduced short pay holds, deadhead and layover pay, sign-on bonuses, extended paid vacation, and even absorbed damage costs that would previously have been charged to drivers. "We've taken the greed out of it," he said, explaining that he and his business partner had reduced their own pay to driver wages to show employees they were "in the same playing field." Despite those efforts, he believes around 10% of small carriers will go out of business in 2026.

There are, however, signs that the situation varies across different parts of the market. Krista Castro, CEO of north-eastern hauler Castro’s Superior Services (CSS), shared at the conference that while lots of companies experienced driver shortages, CSS experienced an “influx of applications” during what she called a “hold year”, as consumer hesitancy shrank vehicle volumes and freed up drivers. And ATA's Costello argued last year that trucking's real problem is one of "quality, not quantity" – enforcement, drug-and-alcohol testing, accident records – rather than an absolute headcount gap. Both observations suggest the labour market is more nuanced than headline figures imply, with conditions varying by region, market segment and economic cycle, while a rebound in demand has the potential to tighten driver availability once again.

And that rebound may be close. International's Stinza described a for-hire commercial-vehicle market emerging from "probably the lowest trough … in a couple of decades", with carriers that "all leave the industry at the same time and all come back at the same time".

Global pressures that reshape where the labour is needed

The workforce story does not sit in isolation from the ocean and the border; the two are connected through capacity and through dwell.

On the water, vehicle-carrier capacity has been structurally tight since the pandemic. Wallenius Wilhelmsen sees relief coming but is underwriting it with roughly $1.6bn committed to 14 newbuild vessels in 2026 – assets with a 20-to-30-year horizon that, as Rye put it, must be ordered now or "push capacity constraints down the road." Middle East volatility, from the Red Sea to the Strait of Hormuz, continues to destabilise ocean costs. And another source of uncertainty is the USTR's Section 301 fees on China-linked and foreign-built vehicle carriers. Although the measures – initially set at $150 per car-equivalent unit – have been suspended under US-China negotiations until around November 10, 2026, they have not been permanently removed, leaving the outlook for ro-ro import economics beyond the autumn unclear.

The link back to labour runs through dwell. When a vessel arrives late or is re-routed, cars staged for that sailing sit exposed, accruing parking fees and yard cost – a point BMW's Jochen Schneider raised directly in April. Volatility, in other words, converts into stranded inventory and unplanned yard labour. Rye argued that better forecasting is only part of the equation. "As much data as we have," he asked, "can you catch it on the other end? Do you have the workforce scalable? … the right skill set?" Greater volatility places a premium on workforce flexibility and technical skills, capabilities that many companies say are increasingly difficult to recruit and retain.

Nearshoring and the concentration of demand

The redrawing of North American trade is usually discussed as a manufacturing and tariff story, but for finished-vehicle logistics, there’s also a labour impact.

The evolving tariff environment is influencing footprint decisions, as Automotive Logistics reported with GM's decision to localise the China-built Chevrolet Aveo and Groove at Ramos Arizpe from 2027.

On the ground, cross-border corridors are also adapting. Nissan’s Todd Myers noted that rail fluidity has improved “enormously” over the past 12-24 months, with some volumes shifting from short-sea services back to rail through Union Pacific and FXE. He also highlighted the ongoing imbalance in southbound flows, which remains a structural challenge. International has worked to reduce border friction by moving customs processes further inland, consolidating loads around 150 miles south of Laredo to support smoother clearance.

Labour availability and driver preferences are also influencing network design. USKO Logistics’ Vasily Borovsky highlighted the challenges of sustaining cross-border driver participation, as increased delays and administrative requirements have made some routes less attractive, driving greater use of local Mexican 3PL providers.

Insurance, economics and the contract vs. spot fault line

Underpinning these developments is a growing tension between carrier cost structures and freight market dynamics. Contracted carriers typically operate on fixed rates for the duration of a contract, while spot and general freight markets remain more volatile. When general freight rates rise – as they have in 2026, supported in part by Amazon-driven demand – contracted automotive carriers can find it more difficult to offer the pay needed to retain drivers. In response, some have returned contracted work, while several OEMs reported relying more heavily on spot capacity, suggesting that the industry's traditional balance between contracted and spot freight is becoming less stable. Nissan's Myers noted in April that rates swung by as much as 40%.

These pressures are also changing how risk is managed. Myers observed that OEMs are increasingly requesting fully audited financial statements from logistics providers because, "ultimately the OEM is the one that bears all the risk." Mercedes-Benz's Cassandra Morgan described having to seek CEO-level approval to revisit fuel surcharges mid-month following March's fuel price spike, emphasising the importance of maintaining carrier profitability despite already modest margins: "I want them to succeed because if they succeed, we succeed at the end of the day." The collapse of Jack Cooper continues to shape industry thinking, and as Autos in Motion's Jeremy White remarked, the recent fuel shock is "the only thing that's really changed the industry since Jack Cooper going out."

AI and operational transformation: Real relief, real limits

If the sector cannot hire its way out, can it automate its way out?

In back-office functions, the productivity gains are already becoming evident. Nissan reduced a 30-person tariff compliance team to a single employee supported by AI tools while also improving error detection. International reported that some of its leading carriers have replaced manual driver dispatch with AI agents, reducing deck-set pairing calculations from around 30 minutes to less than a minute. Yard-task automation – telling existing drivers which vehicle to move next to optimise against the plan – is the near-term "low-hanging fruit" ahead of the fully "dark yard" that technology providers such as Cognosos and robotics specialists envisage. Automated vehicle imaging is also increasingly replacing manual inspection. Myers acknowledged that these efficiency gains could have workforce implications, arguing that the return on investment from AI lies in improving efficiency and eliminating operational inefficiencies.

The scope of automation is nevertheless constrained in the areas where labour shortages are most acute. While AI can streamline planning, dispatch and compliance, it cannot perform the physical tasks involved in loading vehicles or address the underlying economics that influence driver recruitment and retention. As USKO's Borovsky argued, AI should "enhance execution, not replace execution," while Cognosis's Adrian Jennings noted that AI excels at learning and inference but remains less suited to human judgement. Electrification introduces an additional complexity. Because EVs are generally heavier, they reduce the number of vehicles that can be transported per load, increasing the transport capacity required to move the same volume. In this respect, the transition to EVs may increase demand for drivers even as administrative functions become more automated.

Regan of Volkswagen Group of America outlined a broader vision for the sector, centred on greater collaboration across the finished vehicle logistics network. He described an "Amazon of finished vehicle logistics", in which the industry's roughly 1,000 fragmented auto-haul carriers would operate through shared backhaul, cross-haul and partial-load networks, similar to established less-than-truckload freight models. As Regan put it, "There's a thousand different truck carriers that are moving cars for the industry … how do we get that whole network to work together?" He acknowledged that such a model remains a long-term prospect, suggesting that the principal barriers are organisational rather than technological. In his view, commercial protectionism and limited trust between carriers and OEMs continue to constrain the level of collaboration needed to realise a more integrated network.

Moving money, not metal

One of the most significant ideas to emerge from discussions with Richard Regan and other speakers at the April Finished Vehicle Logistics conference was how FVL is framed within the wider business.

Finished vehicle logistics can represent one of the largest working-capital and liquidity functions managed by many OEMs because of the value of finished inventory moving through the network. Viewed through that lens, dwell is not simply a service issue, it also represents frozen capital. A thousand delayed vehicles with an average MSRP of $50,000 equates to tens of millions of dollars sitting idle, with the cost of capital often outweighing storage or maintenance costs.

Reported in these terms, "spend more to move it" becomes less a logistics cost and more a financial decision focused on improving cash flow and reducing working-capital requirements. Evidence that this perspective is gaining traction could be seen throughout the conference discussions: BMW highlighted the cost of parking stranded vehicles, GM and others focused on reducing dwell and optimising yard operations, while both providers and OEMs argued that the lowest cost is not lowest total delivered cost. What appears to be less common is explicitly linking dwell to cost of capital in discussions at board level.

Automotive Logistics will continue to unpack this topic in more detail at Automotive Logistics & Supply Chain Global in September.