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Why China’s Truckers See Power in Numbers

Why China’s Truckers See Power in Numbers

社会

New freight platforms pitted drivers against each other and squeezed their margins. Now, some drivers are teaming up and fighting back.

Li spends most of the year on the road, driving to pay off his truck loan and his son’s mortgage. The 51-year-old trucker told me his wife used to travel with him, living in the cab and keeping him company on long hauls, but with money tight, she took a construction job last year. Trucking simply isn’t as lucrative as it once was, as the emergence of a handful of monopsonist digital freight platforms has led to ever-lower freight prices, but since 80% of Li’s work comes from these platforms, he has no option but to accept what they offer.

Li is one of 20 million truck drivers in China. (To protect his identity, I am identifying him only by his surname.) Together, they form the backbone of one of the world’s largest logistics networks. Largely self-employed, their success used to be dependent on who they knew — drivers with good networks were better able to find stable jobs capable of guaranteeing a good income each month. Those interpersonal networks have been roiled by the emergence of digital freight platforms, atomizing drivers and weakening their bargaining power. But the importance of person-to-person connections has not vanished; rather, it has resurged in unexpected ways.

Prior to 2013, truck driving was a surprisingly social job. Most drivers got into the industry because they had a relative or friend who owned or managed a factory, or else because they had a close personal relationship with a shipper. During down periods, they worked relentlessly to expand their networks among other drivers, middlemen, and shippers to guarantee a steady supply of work and guard as much as possible against sudden downturns.

Roughly a decade ago, the rise of digital freight platforms shook the foundations of this system. The platforms aggregated large amounts of information on cargo and trucks, promising to cut costs by increasing efficiency. The new model seemingly made it possible to become a truck driver without having any connections. Meanwhile, the platform’s low prices lured shippers — and especially small shippers — away from their existing networks of drivers.

Soon, drivers found themselves negotiating against each other. As their relationship networks broke apart, their incomes fell and they became increasingly atomized, which only further weakened their ability to negotiate with shippers and act collectively. The continued decline in freight prices over the past few years has left drivers in increasingly dire straits.

“Some of my former clients have now replaced me,” Li said. “For example, one deal used to be for 200 yuan ($29) per ton, but if others only ask for 180 yuan per ton, I’ll lose my shipper immediately. It’s very difficult for us individual drivers to survive now.”

But these freight platforms are not without limitations. This is especially true regarding orders for relatively high-priced freight, for which shippers would rather work with drivers they know and trust. Meanwhile, the methods that the platforms used to control the market — including leveraging their data on major shipping routes to purchase and operate their own vehicles — have generated a backlash.

Now, drivers are beginning to re-coalesce into new platform-based alliances of their own. In 2018, a commercial driver-centric platform began organizing truckers into “fleets.” These fleets, which are typically managed on an unofficial basis by drivers with access to strong networks and other resources, allow drivers on similar routes to share cargo sources with each other.

The continued decline in freight prices over the past few years has left drivers in increasingly dire straits.

So far, the platform has organized more than 600 of these fleets. For drivers, fleets offer a new kind of solidarity, giving them greater support in safeguarding their rights and increasing their ability to negotiate cargo prices. Fleets above a certain size are also better able to undertake larger transportation tasks while sharing any risks. As such, they are favored by certain categories of shippers, giving drivers access to more guaranteed cargo sources. As one fleet leader explained: “Large factories need a lot of trucks, maybe 20 to 30 a day. If you have to build relationships (with drivers) one at a time, then it’d be really complicated. By using fleets (to ship goods), the quality can be guaranteed. Plus, it’s easier to discuss things if there’s a problem.”

Such digital alliances also give drivers more power to “strike back,” as fleet members now have stronger bargaining power with shippers. The platforms backing these fleets play a key role, mobilizing resources to stabilize fleet operations and financially support them through short-term difficulties. In return, they earn money offering services to drivers or by commissions on trucks sold through their site.

The upheaval in China’s trucking industry over the past decade is just the tip of the iceberg as far as technology’s impact on traditional industries is concerned. The total integration of digital platforms into people’s lives has accelerated the atomization of workers and made it harder to guarantee their rights. At the same time, however, these technologies can be repurposed to rebuild relationship networks and to a certain extent empower disadvantaged groups. Regardless of how quickly digital technology develops, the connections between people should not and cannot be easily dismissed.

Translator: David Ball, editors: Cai Yiwen and Kilian O’Donnell; portrait artist: Wang Zhenhao.
(Header image: A truck driver (right) calls his client in Taiyuan, Shanxi province, Feb. 6, 2023. VCG)


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