Many truckers ‘close to the wall’ with fuel costs through roof

| Thursday, March 13, 2008

OOIDA member Dave Crosby parked his truck in late January. He told Land Line on Thursday, March 13, he’s not moving it again until he can start making a decent living wage again.

After spending the entire month of January running around the Southwest as hard as he could trying to make a living, Crosby said he went back home to Santa Fe, NM, “with nothing to show for it.” He blames a lot of his problems on brokers offering him 95 cents per mile for flatbed freight, which he said is much less than what he needs to run his truck and make money.

“Actually, I came home with less than I started with because I got some fuel stolen in north Texas,” he said. “In some ways that’s beside the point, and in some ways it’s not. Right now, we’re close enough to the wall that we can’t absorb contingencies anymore.”

Crosby said he plans to park his truck until the rates go back up or he sells it, whichever comes first. He said it’s costing him about $1,950 a month in truck payments, insurance, registration and yard rent just to park it.

“But I know I’m not moving the truck again until it will pay me a living wage and at least break even at the end of the year,” he said. “There is no reason to run a business unless it makes a profit. It doesn’t appear that the oil companies, the freight brokers, the shippers or the U.S. government have any problems understanding that concept. Why do we?”

Any relief in sight at the pump?
The U.S. Energy Information Administration recently came out with a revised prediction that there will be lower diesel fuel prices at the pump in the near future.

In the revised forecast, the EIA predicted prices will average $3.70 per gallon in March and April, and then drop to an average of $3.45 for the year.

However, ProMiles reported on Thursday, March 13, that the statewide average price for diesel had reached the $4 mark in at least 12 states now. On Monday, March 10, only four states were averaging $4 or more per gallon for diesel. As of Thursday, ProMiles was showing the national average price at $3.92 per gallon, up 3 cents from Wednesday’s average.

The EIA is also forecasting that crude oil prices will average $94 a barrel in 2008 and will then drop to $86 dollars in 2009. In midday trading Thursday, oil was at another record-high, hitting more than $110 a barrel.

Hauling cheap freight only encourages cheap brokers and shippers
Eileen Unger hasn’t been out trucking since before her kids were born more than 37 years ago. Over the years, however, she has kept her hand in the trucking industry.

For the past five years, Unger has been running a truck management company for owner-operators, handling all of their business needs, including finding their freight and handling all of their billing needs while they are out on the road.

At one time back when diesel was relatively cheap to purchase, Unger told Land Line on Thursday, March 13, she was managing the services of at least 14 owner-operators. She now is down to her last one, who runs strictly in Texas. She lost her next-to-last long-haul owner-operator when he parked his truck around Christmas because of the dramatic increases in fuel prices.

“I don’t have all the answers, but I do know what will help owner-operators out there,” Unger said. “Next time a freight broker quotes them a price and it’s way too low, have the trucker tell the broker point-blank why they aren’t taking that freight. ‘Tell them their price for freight is too damn cheap.’ ”

Besides her custom freight business, Unger also is an agent for a freight broker. She does things differently from most brokers, she said, because she said she “still thinks like a trucker.”

“Before I do anything, I pay the truck what the truck wants and needs to take the load, then I take a straight $100 and that’s it,” she said. “That’s why I keep the good ones coming back and calling me because they know I will pay them decent rates.”

“We feel that not only does accepting cheap freight encourage the cheap brokers and shippers, but it takes our time and effort to load and unload. We have brokers who offer freight here in Texas for just more than $1 a mile and then want you to tarp it as well.”

Unger said she recently saw a sign on a truck that had a picture of a cowboy boot on it with the message, “Help stamp out cheap freight.”

“I want to find that sign and put it on all of my vehicles,” she said.

Unger said she doesn’t allow anyone to use four-letter words in her office, except for one: fuel.

– By Clarissa Kell-Holland, staff writer
clarissa_kell-holland@landlinemag.com

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