2020 was a turbulent year for the truck and transportation industry. The pandemic created manufacturing constraints and supply chain issues which led to significant trucking and transportation job losses from March to April 2020, but the industry is closing in on a full recovery to pre-pandemic levels.

As demand for trucking continues to grow, fleet card companies will gain a significant amount of revenue from fuel spending. As I wrote in my recent report, On the Road to Recovery: U.S. Fleet Card Market Sizing and Forecast, 2020-2025, most of the fleet card industry is comprised of cards that exist on a closed-loop network-which is based on the ability of the card to be used with a pre-determined provider of fueling services. The card companies often negotiate with wholesale fueling companies to determine pricing, which is dependent on the overall petroleum industry. According to the EIA, fuel prices increased in 2020. This increase has been beneficial to the fleet card companies, but temporary industry declines in employment and trucking volume impacted overall transaction volume, leading to decreased card revenues.

The future of the fleet card industry, especially closed-loop network cards, will widely be determined by changes in fueling. As of now, the trucking industry runs primarily on diesel fuel, but we are seeing significant advancements in electrification that have companies reexamining their fleets. It is expected that electrification will begin in smaller vehicles and progress to larger long-haul trucks as the technology improves. We have already seen evidence of this presumption in the news, with Hertz purchasing 100,000 Tesla Model 3’s for its rental fleet and Amazon purchasing 100,000 electric delivery vans from Rivian. The industry is still awaiting more efficient and lower-weight batteries for long-haul trucks.

The changing regulatory environment will also be a significant factor in the fleet fueling space. Corporate climate change and sustainability initiatives, as well as industry regulations set by the federal government, may have fleets examining their climate impact and lead to innovation in alternative fueling sources. We will see what the future brings.