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| 28 Jul 2009 02:28:10 pm |
 Is the high price of fuel passed on to consumers? |
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First, most big trucks run on diesel fuel, commonly referred to as just "fuel." Second, fuel cost is (or should be) figured into any good business plan when fuel is consumed in the course of doing business, but fuel is not a fixed price. When you sell widgets, and it takes one thingamajig per widget, you can account for that and price accordingly. But, in trucking, it's more complicated than that. Fuel price fluctuates throughout the day, not just the week or month. MPG, or how much fuel is burned per mile, also varies with other variables such as wind, temperature, load weight, length of haul, time length of shipment, whether the load is refrigerated or not, driver pay, as well as other variables. Shipping rates are usually set in what's called a Tariff. That's a trucker contract where the trucking company agrees to haul loads from A to B for either a flat rate or a rate per mile. These are in place so that no negotiation has to take place for each shipment. The shipping department of the manufacturer simply calls the trucking company and asks if the trucker has "capacity", or the ability to haul another load. If so, then the load or order is "booked" and appointment times are set for loading and subsequently for delivering. But what about when the price of fuel jumps up $.15 in a week? The trucking company has already figured fuel prices to be around $2.00 per gallon, and now they have to pay $2.15 per gallon. That cuts into the truckers profits, which are normally $.01 to $.20 per mile.
Now the trucker is not going to work for no profit, but the shipper doesn't want to put a shipping clerk in charge of negotiating shipping rates on every shipment, so both companies agree on a "fuel surcharge" schedule. These are typically laid out like so... The base price of fuel is set at, let's say, $2.00 per gallon. An avg MPG is stated: let's say 5 MPG. Then a table is laid out stating how much $ per mile will be added as a fuel surcharge for each $ increase (and sometimes decrease) in the price of fuel. So maybe for every $.05 increase in fuel price, $.01 is added to the rate per mile for shipping. Still with me?
So the truckers get extra $ when the fuel price goes up, but how much? Look at the table: for every $.05 increase in fuel price, $.01 is added to the shipping rate. So the trucker says they paid $2.50 for fuel, and the shipper says "no way! It was only $2.04 here." Argument ensues, and they finally decide that the fuel prices should be based on the average price paid by all fuel purchasers for that period. Fine, but wait....How do you figure an average? During the period... or after the period, when you have all the data? Right, after the period is over. So fuel goes from $2.00 to $2.05 in a week. The trucker ends the week buying fuel for $2.05 per gallon. Starting next week, the average price of diesel fuel will be $2.025, so according to the fuel surcharge schedule, the trucker does not get any increase becuase the fuel price has not yet gone up a full $.05. No biggy, right? Keep hauling and quit whining!
Now fuel for this week goes from $2.05 to $2.10. Next week the average will be released from the Department of Energy saying it was $2.075, the trucker will be paying $2.10, and he'll bill a fuel surcharge of $.01. See where this is going?
In my opinion, truckers who rely on fuel surcharges to keep them profitable are allowing their customers to set their rates. I'd love to go to Walmart and tell them I know how much it costs to make a DVD so I'm only going to pay a few cents more than that. This is what trucking companies are allowing when they accept fuel surcharges as quick fixes to long term problems.
In the end, the fuel cost is passed along. But that's only after shippers use up all of the truckers who don't know exactly what they should be charging per mile (every day) to haul a load. Once those truckers are all used up and have had to give up their truck(s), the truckers who watch their bottom lines closely will still be in business, will be in higher demand (because of lowered capacity from other truckers going out of business), and will haul loads for the highest bidder. Those high bidders will have to absorb or pass on that cost to the consumer in the end, but it will be 6 months to a year before the real punch is felt by consumers. IF you want to know how the economy is going to be doing in 6 months, look at the trucking sector today. |
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Category : Trucking Jobs
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| 23 Jun 2009 08:03:32 pm |
| Trucking Jobs Shrinking |
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| More and more drivers have decided that it isn't so bad where they already are. It used to be that almost every truck driver was always looking for greener pastures, and would change jobs at the slightest hint of a problem with their current job, or even the remote possibility of a step up somewhere else. Well, times have changed in this economic slump, and more and more drivers are staying put, and "putting up" with cutbacks and belt tightening that they would never have stood for just a couple years ago. But this isn't all bad news for truckers. Many drivers who would normally be changing jobs every 6 to 9 months, are suddenly realizing that stayin on with a company during tough times can actaully benefit them. Seniority can help a driver's bottom line tremendously. Vacation pay, being next in line for a new truck, becoming eligible for a 401k plan, are all benefits that many drivers never got when they were job hopping. During tough times vacation is not always usable, but the pay always is. So whether you are a job hopper, or a lifer, there is always something to be positive about, and trucking really needs something to be positive about. |
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Category : Trucking Jobs
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| 07 Jun 2009 04:55:27 pm |
| Free DOT Drug & Alcohol Forms |
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Truckdrivingcdljobs.com is pleased to announce that we have developed a tool to speed up the process of getting DOT Drug and Alcohol Forms signed and returned to a new (prospective) employer. By visiting http://www.truckdrivingcdljobs.com/recruiters/dotreleaseforms/ drivers can sign the DOT Drug and Alcohol Forms online and employers can retrieve and print the forms, complete with driver's signature, right from their personal computer. This tool cuts out the wait time traditionally caused by faxing or mailing the forms back and forth. Best of all, the tool is 100% free!
Click on the link below to test drive the tool now!
DOT Drug and Alcohol Forms |
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Category : Trucking Jobs
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| 18 Apr 2009 04:13:43 pm |
| Economic Turnaround in Trucking? |
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| So we all know that trucking is a leading indicator of the future economic state of our country, leading the other industries by about 6 months. So we want to know, have you seen any turnaround in your jobs, the number of loads you're hauling, the rates of pay for loads? Let us know if you think the economy is headed for better times or more of the past 9 months. |
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Category : Trucking Jobs
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| 09 Feb 2009 02:38:18 pm |
| Bailout - Where's the trucker's checks? |
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| So the democrats have passed a stimulus bill in the house and are working on it in the senate. Included in these bills are hundreds of millions of dollars for undeserving companies and groups of people. What about the hard working trucker drivers out there, who have been hammered by high fuel prices for most of last year, and are close to going over the edge because of being slow payed by their customers? Where's OUR bailout? Seems to me that the only people being bailed out are the people who need to be PAID BACK for helping to get Obama elected. Seems to me that re-sodding the lawn and handing out condoms to jobless bums only worsens the problem. I can't think of a better time to implement the FLAT TAX. |
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Category : Trucking Jobs
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| 27 Nov 2008 06:14:15 pm |
| Let Us Give Thanks |
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It's the time of year when we all stop our busy lives and say thanks to the people that help us do what we do. I want to take this time to say "Thank-you" to all the drivers who work so hard throughout the year delivering food and goods that keep this country running, in good times and in bad. The economy is not doing so well right now, and most of us are feeling the pinch. But I'm sure if you look deep enough, you have some things to be thankful for. Living in the best country in the world is a good start for me personally. Having a job, or the ability to find a new one. Having a family that loves you. A smiling waitress at the last truckstop you ate in.
Whatever you're thankful for, we ate truckdrivingcdljobs.com hope that your Thanksgiving is a happy one.
Keep on truckin'! |
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Category : Trucking Jobs
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| 05 Nov 2008 04:07:06 pm |
| Cut out the wait on DOT Release Forms |
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| You know those annoying forms you have to sign for every potential company you might go to work for that allows them to get your previous work history and drug & alcohol test results? Those are commonly referred to as DOT Release Forms the time they waste having to wait for then via a fax or even slower, via snail mail is a waste of time for both the driver and the trucking company. What if you could sign those forms instantly and have them back to the trucking company instantly? Now you can sign those forms right on your computer by using the free tool at http://www.truckdrivingcdljobs.com/recruiters/dotreleaseforms/ |
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Category : Trucking Jobs
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| 02 Nov 2008 08:53:40 pm |
| Winter Driving for Truck Drivers |
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I haven't personally seen any snow yet, but the winter driving season is here. Chain laws for truck drivers are officially in effect, and the winter driving season means alot of important things to everyone out there on the road. Whether they are in a truck or a four wheeler, drivers need to remember that winter driving is different than the rest of the year. For the professional truck driver, this is nothing new, but for the new cdl holder, we felt like a quick run down on things to watch for would help.
- Four wheel drive pickups that think that just because they can go fast, they should
- Four wheelers who have never seen snow before and think that driving 5 mph is "risking it"
- Frozen brakes, air lines, jelled diesel fuel, & dead batteries
- skipping pre-trips because it's too cold out
- lost traction in parking lots and customer yards
Above are just a few of the many things to watch out for this winter season. Remember to pack some non-perishable foods to keep in your cab in case of a whiteout, blizzard, or other unpassable conditions. Roads can be shut down with little notice and having a granola bar or two can make that idle time a little easier to deal with when you don't know when you'll be able to move again. Keep your CB radio in good working order, make sure your APU has been serviced, and carry so fuel additive to keep your diesel from jelling. |
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Category : Trucking Jobs
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| 26 Oct 2008 05:06:15 pm |
| Lumpers and other con-men. |
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For any of you in the trucking business that don't know what a lumper is, it is a person who unloads or palletizes freight. Most people not in the trucking business assume wrongly that all freight is put on pallets and a forklift puts on and takes off the freight from a trailer. We wish it was that easy. Despite the fact that trucking companies are paid to haul freight from point to point, most companies have gotten sucked into the unpaid business of unloading and sometimes loading the customers own freight off of and on to their trailers. With the hours of service rules being as strict as they are and the succeptibility to injury, many companies do not allow their drivers to unload freight by hand. Instead, they hire a lumper. Lumpers are typically meth addicted thiefs who will rob you in a heartbeat if they can. They accept cash payments from the trucking company's driver to unload freight from the trailer so it is arranged the way the receiver wants it arranged. Logic begs the question, "If the customer wants the frieght arranged a certain way, why don't they order it that way from the supplier, and why is the trucking company paying to arrange it?" Great question, and one that I personally have never been able to answer. Apart from weak minded trucking company execs who cave into unscrupulous tactics from receivers in order to keep hauling freight, I can't fathom a reason. Most lumpers do not pay any taxes on the money the make. Many are receiving unemployment checks while making 400 - 800 per day tax free. They are the scourge of the industry and a law to require shippers and receivers to oad and unload their own freight is desperately needed. A law demanding this would stop tax free monies from being paid to drug addicted thiefs, would allow drivers to focus on driving instead of arranging for and sometimes unloading the freight themselves, only to find themselves too physically worn out to drive.
LUMPERS are terrible and should be eliminated. Write your congressmen today to le them know about this little known bad side to the trucking industry. |
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Category : Trucking Jobs
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| 03 Sep 2008 07:11:05 pm |
| In the end, Truck drivers are paid by the hour, not the mile |
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I heard a driver complaining the other day about being told to drive a different, longer route than he would have chosen to drive if it was up to him. He was saying that he got screwed out of some pay because the miles he was paid to drive were less than the miles he was told to drive. This part of his complaint I understood. It sucks to get paid for less than you drive. This is, and always has been, an unfortunate downside of paying drivers based on miles listed in a mileage guide instead of the actual odometer. Industry reports say that drivers get short paid about 5% of the miles they actually drive. But when you account for the miles that most drivers put on the truck running errands, going home for the weekend, etc, it just about comes out even.
So, back to the whiner. He was told he would get paid 500 miles but was told by the company's fuel optimizer to drive a route that took 550 miles. The catch is, the 550 mile route was 1/2 hour faster than the 500 mile route. The driver said he wanted to drive the 500 mile route cause that's what he was going to be paid for. At first glance, this makes sense. But does it really?
The driver was going to be paid for 500 miles, no matter which route he drove. It would take him 8.33 hours to drive 500 miles at an average speed of 60 miles per hour, or he could average 70 miles per hour for 7.86 hours to go the 550 mile route. The different average speeds are because of the speed limits, stop lights, and stop signs, and ability to pass slower vehicles. The driver was NOT paying for the fuel in the truck, the company was, but he was still complaining about having to drive 50 miles further, even though it took him 1/2 hour less.
So I ask all the other truck drivers out there.... If you get paid per book mile (not odometer miles), would you rather drive less miles for a longer time, or more miles in a shorter time, all for the same pay?
Every OTR truck driver gets 14 hours to work, and 11 hours to drive every day. If a driver's goal is to make as much money per day as safely possible, they should be asking themself, "How quickly can I drive these miles safely?", not "Does my pay stub match my odometer?" Because in the end, when we look at our pay stubs, the most important number is the dollars, not the miles. |
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Category : Trucking Jobs
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