Truckers really hafta be hurting right now.

[roamer65]

I saw $4.08 a gallon for diesel this am on errands.

[Wickerman]

1. The independents are parking their rigs

There is no money in it for them. The big carriers can add a fuel surcharge that is then passed on to the consumer, but the little guy, as per usual, has no way to cover himself. Sad times.

[zonmoy]

2. As the shipping industry goes under.

the rest of the economy cant be far behind.

[roamer65]

4. Yes, very sad times.

I really believe we are heading toward the first hyperinflationary depression in American history.

[ristruck]

7. Chief Operating Officer

I am the COO of a 100 million dollar trucking concern. We do get a fuel surcharge but it only covers 60 to 70% of the increased cost of fuel. The entire industry is losing money. Carriers are not making payments to the banks. The banks cannot take all the equipment back because there is no market for it. The economy is so bad that carriers are in fact cutting rates just to attempt to keep some cash flow coming in. Carriers are laying off office staff and cutting wages to try to stem the tide.

There appears to be almost no hope for us and many carriers that I interact with. Our owner operators are in fact parking their rigs daily. The banks I speak with are in trouble with our industry, the housing industry, the construction industry, and other consumer products industries.

All the while President Bush dances while it feels like Rome is burning.

[Wickerman]

12. Thanks for that information

and sorry if I overstated the ability of the corps to recoup their losses. Your post really highlights just how bad it is out there. We are screwed, really, really screwed. Having been a resident of Texas during numbnut's reign as Gov, I knew we were in trouble. I certainly had no idea just how much he would actually screw us over.

I hope your industry can pick itself up soon, but I fear the causes of your troubles are only symptomatic of too many other economic areas that are totally out of whack.

[salin]

13. Sadly, our country was sold greed and short-term gain without

any concern for the long-term consequences, for a whole lot of years. Innumerous policies that may cost a little more in the short-term but provide for long-term infrastructure health (economic, industrial, etc.) have been shucked aside.

Aside from the ill-conceived war, nothing encapsulates the thinking that has been rammed down our throats and translated into horrendous policy than the exchange between Bush and Cheney as Bush is being pushed to announce the second round of huge tax cuts - ala then Secretary ONiell (via Ron Suskind's book with ONiell), Bush asks Cheney if the first rounds of tax cuts weren't enough, and Cheney says no - and that deficits "Don't Matter, we learned that with Reagan".

Or giveaways to favored industries that do little for the public good - a great example of this was in the final form of the medicare-prescription drugs bill - there had been a provision to give tax breaks to companies that continue to provide this insurance to their retirees (thus saving the taxpayers/fed govt money) and in the final version, after reportedly the dems were locked out of conference committee, and the GOP congress folks were workin madly to rewrite with the help (and at times authorship) of corporate lobbyists, the tax break stayed in - but the provision to receive it based on continuing coverage for retirees through existing plan was stripped. More money flowing out to deficits with no public good attached to it.

Per the oil prices, of course a major contributing factor is the instability in the Gulf region created and fueled by our war policies, and the leveraging power we once had with OPEC is drying up. Yet for years there has been resistance to serious R&D funds into alternative fuel technologies (spending pennies per the dollars needed) and focusing for years instead on opening up Anwar as if a limited amount of oil, that would take nearly a decade to bring to the market - would provide relief now, or much relief in the future. If we had kept investing in alt energy as we were under Carter (cutback and ended under Reagan, and most efforts of the Clinton admin were rebuffed by the republican held congress) - imagine how different the scenario today would likely be. Again that was long-term thinking in response to the last major energy crisis.

Thank you for your post, although I have digressed, your post highlights how precarious the current situation is for the shipping/freight industry and with no relief in sight - it boggles the mind to try to comprehend how this will effect so many related industries.

And yes, it does feel like Rome is burning.

[Ikonoklast]

14. I'm the CEO of a multi-dollar trucking firm, that's right, multi-dollar

Owner-Operator here.

Just kicked off a load at a Wal-Mart DC in upstate New York this AM, and am waiting out P/U tomorrow afternoon.

Sat home for the last three weeks as posted freight was picking up, but rates were in the toilet. There is no way I can justify even turning the key to start my tractor for rates that not only don't pay a profit, but don't even cover the basic cost of operation, or even cover the cost of fuel, for that matter.

I am leased on to another O/O and run under his authority, and for the last three years we were running two dedicated routes, and just lost both of them to someone willing to do it for less. All they'll end up doing is running themselves out of business.

I've been getting calls from brokers desperate to move their freight after I post my truck, but at $4.09 fuel like it is here in upstate New York, I only move when I can get my rate.

This one paid $3.00 a mile, all miles including deadhead, but it was a recovery from another carrier that dropped the load. (Bet the weather, and a Friday night pick-up had nothing to do with that ).

Some of the freight brokers that I've known, and worked with these last years just cannot believe that they still get loads moved at the rates shippers are willing to pay.

It is a death spiral for the independents, as well as the smaller carriers. The mega carriers will wait it out, and when all is said and done, they will be the only ones left.

They will be able to dictate freight rates, and then watch out.

[GreenPartyVoter]

16. This is so scary to me. I live in a rural ara where it snows 4-5 months a year. We kinda

rely on food being trucked into the local grocery stores, but I worry about whether or not that system will break down. At the very least, food costs are gonna skyrocket.

[Rosemary2205]

9. it's a walmart world.

unfortunately there are many industries that make competing as an independant next to impossible.

corporate farming, hauling, retailing, everything.

wages not keeping pace with the value of the dollar have caused many Americans to look at price first instead of quality.

[Jane Austin]

11. Our Mom and Pop store and website

are quite competitve in price with the big box stores, but most of what we sell is better stuff than what is available there.

Our customers tell us that they come to us specifically for dog toys because ours are actually cheaper than PetSmart - for the exact same toy.

And I would add that we have a better selection, too.

[XOKCowboy]

3. Where is this?

It's a little over $3.20 in Denver.

[roamer65]

5. Michigan.

Regular unleaded was $3.29.

[XOKCowboy]

6. Wow...

I have a friend who's a trucker based in Detroit. Luckily he's not an independent. I'll have to ask him about it.

[Jane Austin]

10. Diesel?

Here in Central Texas, I pay $3.59 for diesel for my VW Passat, while regular gas at HEB and Costco is $2.99.

[Jane Austin]

8. Everything we sell at dogstuff.com

is shipped to us in trucks.

And then we turn around and ship to our customers.

Fed Ex is charging us $4 extra for residential delivery in some cases, plus there's a huge surcharge for fuel, and another charge for rural delivery. We can't pass those charges on to our customers and remain competitive.

The Post Office has made it difficult to deal with them in the past (our employees had to go stand in line at the PO and ship each box individually for anything not priority) but we had a meeting with a PO person who has shown us all the ways to make it easier to ship with them.

We saved $75 on the the first nineteen parcels we shipped in our experiment with going with USPS.

But our incoming products still have to be shipped by truck and it's going to make everything - not just what we sell - cost more for the consumer.

Did I mention our December bills from Fed Ex (Ground and Express) were $18,000?

[Rosemary2205]

15. 12%-15%

Your actual shipping costs should run about 12% to 15% of the merchandise cost to your customers. Though some choose to inflate the profit on the merchandise and take a loss on shipping when they sell direct to the public. -

Our B to B costs run around 11.9% and we charge 12.4 to 13 to our customers. Shipping east coast to west coast is running us about 15% or more but we still stick with 12-13% invoiced to the customer.


Big haulers, FX, USPS, corporate trucking - they negotiate diesel prices and either buy in bulk and gas their own trucks, or cut deals with gas chains or both. Indy truckers cannot really do that so they pay the retail cost.