Life on the Road – Trucking News Blog

Chuck, why do you think incorporating is going to be the ‘right’ way to go? You still have to make money to make your payments. Unless your corporation has some business credit, any truck seller isn’t going to sell your corporation a truck without a personal guaranty for payments. Unless you have employees, incorporating only lines the pockets of attorneys and accountants.

Thank you Mr Weisser for putting it just right. It is a business and it follows all the rules of capitalism at its finest.

Mr Miller. I wasn’t beating you up directly. I feel for the O/O because they work the hardest in the whole industry and many have big issues with their family because of the love of the road. They should get paid a premium.

I am an owner of a small trucking company. I started this business saying that I will make money only by running trucks and running miles. I will not make money off the backs of employees or O/O. I do not deduct pay for accidents, missing equipment and the sort like many other carriers. I don’t have any O/O – because I can’t pay them enough to last through the long haul. I too am beaten by carriers who hire O/O and charge them for every little thing that happens. They make their margin off the costs they don’t have to pay – missing load bars, scratches to the equipment (that they don’t fix), blown tires etc.

For all you O/O and small carriers out there, do yourself a favor. Study every cost right down to the cpm. KNOW YOUR COSTS and watch them everyday. Have an exit plan and stick to it. It will get worse before it gets better.

This weeks DOE is 3.81 $/Gal. A truck running 6mpg will cost 63.5 cpm add your personal wage of 35cpm and you are already at 98.5 cpm. A truck payment of 1100/month at 11000 miles per month will cost 10cpm. Now you are at 108cpm. If you are running for 1.10 or 1.15/mile you will not pay for your maintenance, insurance, plates, incidentals and anything else that comes up in the last 2-7 cents per mile. At 7cpm you have $770 left at the end of the month for payment of the rest. Everything above $770 comes out of your personal wages. If these numbers are liberal, as I think they are, it just won’t work long term.

GOOD LUCK.

Jim

Charles, no one has beaten you up. You’ve laid out every detail of your trucking daily life and everyone appreciates it.

The way we think may be pathetic, but the bottom line – it’s a business first. It may be also be a lifestyle, but it’s still a business first. And as business men, we all hope for better days ahead. The truth is I’ll probably go under before you. If I can last till my wife finishes school and is working, I won’t care. I will, but it won’t hurt as much.

This is why O/O’s are going to have such a hard time. The reluctance of running their business like a business and bailing out before it’s too late. Then finding something else or driving for someone else.

I completely agree with Charles, there are a lot of dirtbag fleet owners and companies out there. Finding the good ones is tough. Hopefully, the dirtbag fleet owners go under just as fast if not faster as the rest of us.

But because they use o/o’s and have no overhead and no expenses, their o/o’s are going to go under first.

Mr. Jimmy Anonymous,

How can you come to this conclusion to what kind of owner operator I am?
Do you have a reading comprehension problem do you understand the English language.
I will summarizes maybe you A.D.D…

1. I am concerned about the current crises that faces our industry.

2. I am concerned about the future of guys like us (small Independent O/O).
3. I am only one man, I post my feelings to try to generate thought, to try to get the I.O/O’s rallyed and fired up, to realize that we as a mass of ONE can make a difference.

But, to no avail. I’ve been beat up on here by all the authors, and by you. I’ve gained a lot of in site, of how you guys think, and its pathetic..

I understand why this industry is in the shape its in. I will go back in my shell, keep to myself and not worry about anybody but myself.

And for your information, I’ve been a Trucker for almost 15 yrs. 12yrs of struggle leased to big and small outfits like yours.
I finally went broke in 04, sold my truck and trailer (which were payed for), to pay my debts, went thur 5 different driving jobs in 2yrs, working for assholes. Currently I have bought another truck and trailer, have got my own authority / LCC. With a lot of hard work, love for truckin, hope and prayers, I’ll make it through this current bullshit.

And to all of you, no need to respond, I won’t be here anymore.
I’ll be searching the web for a better breed of TRUCKERS that share my thoughts, love for truckin and hope for better days ahead.

I just want to add, as an owner of a small trucking company (7 tractors – all company drivers), the O/O’s seem to be part of the problem.

I have O/O’s calling me everyday begging me to put them on our fleet. I refuse because I cannot pay them enough to keep their heads above water. They will work for cheap only to keep the cash flowing. Mr. Charles Miller (earlier post) is one of them. Maybe O/O’s should sell their trucks, become a company driver and make the same amount of money without the headaches.

The only answer to the current problem is LESS AVAILABLE TRUCKS. The sooner this happens, the quicker the rates will go up. Last week I went to one of my customers asking for an increase in the rate. The rate has been the same for 14 months. I was advised that unless I drop my rate by $100, he was going to go to another carrier. I lost the contract. I am only hoping the carrier, who has it now, who only employs and exploits O/O for less than they are worth, loses his O/O’s because they cannot satisfy the O/O’s demands for an increase. If his service fails, I may get the contract back at the original price.

I wish O/O’s would take more time to look at their expenses, understand them, know when they are losing money, and find some way to change it or else get out. Why buy another truck when you can’t afford the one you have? Why work for less take home pay than you would if you were a company driver somewhere else? Get out when you still have some equity left and plan to get back in the industry when it changes for the better. If you have any experience at all, you will know when the tide has changed.

Jim

It says here:

“he spent $64,000 on diesel in the last eight months.”

Hmmmmmmm….

at $3.50 a gallon that’s 18,285.71 gallons.
at 5 miles to the gallon that’s 91,428 miles
….that’s 11,428 miles per month.
….that’s 2857 miles per week.

unless my math’s wrong.

Lot of miles.

Of course he COULD be getting better fuel economy….in which case the numbers are even higher….4 thousand miles per week at 7 miles per gallon. If that’s the case then he’s maxing out his log book ….EVERY day.

Bet he’s worn out.

200,000 miles a year on the truck too.

We’re here. I check the site at least once a day, but I may not have time to update or comment on something and I hate doing it when I’m rushed.

You’ve summed it up pretty well. But it’s not all bad. I still love driving, but the day-to-day BS is starting to get to me more and more.

I’m hoping to be among those that survive this downturn too, but you never know.

This was the main point of this post and several others here is that trucking is changing, like it or not. We’ve covered some of the changes in our podcasts and in several posts.

The best we can do is be prepared for the worse and hope for the best. I hope when we get to the other side of this downturn, we still recognize the trucking industry, because there’s a good chance it may be completely different in a few years.

Where did everybody go?

I was just starting to get some good info out of you guys, I know Mr. Corn has it made and prob has better things to do, but how bout you other gents. I’ve had a lot of time to think about our last round table discussion. I’ve come to the conclusion and have changed my feelings about caring about the welfare of my fellow drivers, although it goes against may grain, I must direct my cares to myself, my family and my livelihood.

You are right….as this is a tragic time for our industry, we have no one to blame but ourselves.

The biggest problems with the industry is the TRUCKERS and APHATY..

So as it goes, the strong will survive the weak will be eliminated, I hope I am the strong….. If not Mr. Corn will you adopt me…….

Okay Charles, I think we’re beginning to come together on the same page.

You know, I’ve been in this business now for, Christ, 32 years. I’m 53 now.

I’ve been in the business since the time when cabovers ruled and the Cummins 290’s were common and the 350 was considered a big engine.

Back then, we had fun and this wasn’t a job. We liked one another and helped each other out. Back then, it was a lifestyle and a good one.

You hit the nail on the head about the majority of company drivers, not all, but some. But consider your fellow O/O. He could give a rat’s ass about you or any of the others out here.

You hear them paying lip service to it on the overnight radio shows but few follow through. These days, it is all about ME ME ME and to hell with anyone else.

That is unless they are trying to show their misguided conservatism but that is another subject.

Anymore, this is just a job, and to me, the best part is returning home every week where the reason for me continuing to put up with the BS is very evident

Yeah Linda, I knew the answer. It was a rhetorical question.

You are also correct about the companies going to the Lease- purchase model of business.

I have a good friend who is doing that with a company in El Paso. I won’t mention the name because they have strong ties to International Trucks and have a stake in Border International there.

They “rent” him the truck. They try to route him and tell him where to fuel. He has no choice of loads. His pay is .87 per mile with a .35 cpm fuel surcharge. On the average, he is allowed to run 5000 miles in a 2 week period. After all deductions, he is lucky to take home a check for $1600.00

But he has his name on the side of the truck and he’s happy. And sadly, he is an experienced driver

If we were all-all truckers-to get behind the effort to legally declare all fuel surcharges go to the guy who pays for the fuel, it would go a long way toward sorting out this mess. For one thing, it would cut the profit out of brokering a load multiple times. I’m sitting here this am looking at my daily email from Transport Topics and these are their lead stories:

Diesel Jumps 10.6¢ to Record $3.658
NAFTA Surface Trade Climbs 3.1%
Landstar CEO Sees Higher Truck Rates
Norfolk Southern Opens Ohio Intermodal Terminal

That’s the entire story in a nutshell: there’s plenty of freight, the rails are getting an increasing amount of it, fuel surcharges will soon rise and Landstar (as representative of the larger broker/carriers ) is making money while most of us are starving.

Couple of quotes from the Landstar article:

“U.S. truck freight volume increased in January for the third straight
month compared with a year earlier”
“The carrier’s revenue per load improved in the first two months of the
year”
“There is still some weakness in truck freight demand, which Landstar is
offsetting by increasing revenue per load, Gerkens said.”

How do you get ‘increased revenue per load’? You broker it to somebody who will haul for cheaper than your own drivers will. So, Porter, there’s your answer to where did the rest go.

And Charles, I’ve been trucking since ‘91-live 60 miles out of Detroit. I used to do alot of Laredo freight and was always sure of getting a load right back to the ‘home 20′. Then, got so I’d sit there looking at 600+ of our trailers in the lot and be told there was nothing there for me. Got friendly with a guy that had access to all the bills and he showed me a stack of at least 80 loads going straight to Romulus-all brokered out to somebody else-maybe you. It’s worse, now-if you get a load inbound to Laredo, my carrier will let you sit 2-3 days before they give you a load out. My income dropped $20,000 last year-and I’m a company driver (that big orange one). Friend of mine dispatches for a small (160+ truck) outfit in the Indianapolis area-in the past three months they’ve ditched nearly all of their company drivers and leased trucks to most of them-now they’re nearly all owner-operators. He said last week the fuel surcharge they were paying was $.39/mi-and they have two brokerage people on staff brokering freight and making more on it than they do on their trucks.

As for Moyes and Swift,I think we’ve seen how he works before. But, he managed to get financing for over $3 billion to buy his stock back and take it private. Morgan Stanley backed him on it. Why? Look at the DJ Transportation index for the last five years: it’s down right now but the 5 year average shows it over 18%. Now that you have US Express, Schneider and Swift all privately-held, you’d better believe they expect to see some healthy returns on their profit columns in the near future (and it wont show on the DJTA). And a lot of it’s coming from brokering based on their keeping a piece of the fuel surcharge that should go to the owner of the truck. The only way they’re keeping cheap owner-operators is to lease a truck to every new 3-month driver who went thru their school-before he ever learns how to compute his actual cost of doing business.The big carriers are all doing it-and getting rid of their experienced drivers at the same time. You either buy a truck from them or you dont get any miles.

So, I DO think some regulation is necessary. Becuase the greedy bankers will starve everybody in their way into submission, destroy the transport of freight and the economy along with it if they dont get some regulation. Trucking will look like the mortgage fiasco ’cause these people dont care who they hurt or how bad as long as they’re making big profits right up to the bitter end.