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  #11  
Old 05-27-2008, 03:40 AM
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...Interesting idea BigWheels. The problem is, the demographic you'd be pitching to advertisers is truckers...and we all know they're going broke :shock: :lol:
You mean to tell me that advertisers would take a pass on making a buck off of truckers? :shock: :lol:

You have a valid point No_Worries, but some advertisers (Verizon, T-Mobile, etc.) do quite well catering to truckers.
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Old 05-27-2008, 04:22 AM
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As with any heavily cyclical industry, the ones that survive the periodic purge will be in the sweet spot for awhile. As for how often I drive...not as often as I should :lol:

BW, I was only joking; there certainly are companies willing to pay to advertise to truckers. There several people out there (I won't name names) giving supposed expert analysis on the industry. Their credentials are pretty sparse and they simply give their take on publicly available data. I don't put much credence in what they say but apparently some do. Tell you what, you start a website, I'll contribute some ramblings :wink:
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Old 05-27-2008, 01:07 PM
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As with any heavily cyclical industry, the ones that survive the periodic purge will be in the sweet spot for awhile. As for how often I drive...not as often as I should :lol:

BW, I was only joking; there certainly are companies willing to pay to advertise to truckers. There several people out there (I won't name names) giving supposed expert analysis on the industry. Their credentials are pretty sparse and they simply give their take on publicly available data. I don't put much credence in what they say but apparently some do. Tell you what, you start a website, I'll contribute some ramblings :wink:
So, when it comes to all the grief and terror we may be hearing about in the months ahead, perhaps it's possible to miss out on a lot of it just by positioning yourself to wait it out. Indeed, some guys won't make adjustments but will go full steam ahead counting on things to be as they've always been, but of course they won't. Their bankrupcies and sorrows needn't be shared by everyone if we'll pay attention to not be one of the ones who washes out. I don't mean to sound gloomy, I'm just thinking about what it'll take to be in this business all the way to the time when fuel prices stabilize and the economy adjusts to those prices, whatever they may be. Freight volume will most certainly be lower, but the capacity should be lower too.
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Old 05-27-2008, 03:12 PM
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I think we've seen the worst in terms of freight volumes. Gross volumes seem to have stabilized and relative volumes have started to improve due to the shrinking of capacity.

The issues the industry faces from here on out will be primarily financial. We've had the credit crunch, that has crimped the ability of the undercapitalized to finance continuing operations. That could be huge issue for many because I believe we still have a recession to deal with. Assuming freight remains stable, the biggest issue presented by an economic slowdown is getting paid. As shippers start to feel the crunch, days to pay get longer. Because many brokers are undercapitalized the time it takes them to pay carriers gets longer...many brokers will go under because they just can't afford the float. Any carrier that doesn't do his due diligence might find a check or two missing. Combine that with the high fuel cost and things will be tight financially.

Carriers that have their financial house in order will be fine. They can afford to absorb the occasional slow- or no-pay and don't have to rely on credit to get through. That and fuel prices will be the two major issues coming up.

There is some indication that pricing power is starting to swing back our direction. I just saw where Wal-Mart is putting many of it's contracts out for bid early. As on exec noted in the article, WM is pretty good about keeping a tight reign on their costs. The fact that they're making this move now might indicate that they think it's a good time to lock-in transportation rates.
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Old 05-27-2008, 07:42 PM
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Originally Posted by no_worries
I think we've seen the worst in terms of freight volumes. Gross volumes seem to have stabilized and relative volumes have started to improve due to the shrinking of capacity.

The issues the industry faces from here on out will be primarily financial. We've had the credit crunch, that has crimped the ability of the undercapitalized to finance continuing operations. That could be huge issue for many because I believe we still have a recession to deal with. Assuming freight remains stable, the biggest issue presented by an economic slowdown is getting paid. As shippers start to feel the crunch, days to pay get longer. Because many brokers are undercapitalized the time it takes them to pay carriers gets longer...many brokers will go under because they just can't afford the float. Any carrier that doesn't do his due diligence might find a check or two missing. Combine that with the high fuel cost and things will be tight financially.

Carriers that have their financial house in order will be fine. They can afford to absorb the occasional slow- or no-pay and don't have to rely on credit to get through. That and fuel prices will be the two major issues coming up.
There is some indication that pricing power is starting to swing back our direction. I just saw where Wal-Mart is putting many of it's contracts out for bid early. As on exec noted in the article, WM is pretty good about keeping a tight reign on their costs. The fact that they're making this move now might indicate that they think it's a good time to lock-in transportation rates.
I'm trying to fit this together. On the one hand you think we've seen the worst of the freight slow down, but on the other hand you see two of the greatest threats to freight volume yet to run their course- a lack of money available for borrowing and fuel prices.

It's hard for me to imagine these fuel prices not slowing things down dramatically. I think people are still doing things based on habit and that people haven't really adjusted their behaviors for the new economic realities (a Honda Accord gets 10mpg more than an SUV, the cost of driving to McDonalds can be as much as the food, prices on everything will have to rise...) As people start staying home more and buying less due to increase production and transportation costs, it seems it'll cause the amount of semi trailer loads of everything to fall off dramatically. I'm putting things in my own words instead of using jargon to make sure I really understand what I'm talking about.
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Old 05-27-2008, 09:40 PM
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I was speaking to constricting credit and fuel prices as operating factors for carriers, not to their impact on the consumer. Consumer spending has been slowing for a few quarters already. I don't think it has that much further to drop. Much of the freight recession was caused by the housing crash. While home sales/prices still have a ways to go, construction has about bottomed. Now, if the rest of the world tanks before we start to pull out, then all bets are off. But for right now, exports are helping to make up for weakening domestic demand.

The bottom line is that freight volumes lead the general economy by anywhere from 6 to 18 months. This is due to cyclical spending patterns of consumers and corporations and the nature of inventory fluctuations. Many times, freight is often well on its way to recovery before the economy starts to head into recession.

Bear in mind, economics is based mostly on patterns that have developed over time. As Solo like to say, there are exceptions to every rule :lol:
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Old 05-28-2008, 01:42 AM
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Originally Posted by no_worries
...Tell you what, you start a website, I'll contribute some ramblings :wink:
I've thought about it. 'Course I'd need a grant for the 1st year...say $100K. Know anybody? :lol:
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Old 05-28-2008, 03:05 AM
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I am not sure the worst is yet to come. I hate to be a pessimist, but there are still plenty owner operators and carriers who will fall by the wayside during the coming year. I believe things will be difficult into next year. There is freight available, but fewer carriers willing to haul for the cheaper rates. There are still many who continue to try to haul for fuel money just to keep going. If you have high debt and are running for low rates, you will have a much more difficult time than those with low debt and good rates. Freight is lagging in some segments due to shippers holding back product in anticipation of owner operators and carriers willing to haul for lower rates to keep going. At some point these shippers will need to move their products to keep afloat.

Carriers and owner operators will need to sharpen their negotiating skills during this time. I believe the economy will continue to limp along until next year. I hope that I am wrong. A sharp reduction in fuel prices will certainly help to stimulate things. Banks and investors made huge mistakes when they made so many marginal loans. Now they want the government to bail them out. I think they need to suffer the consequences of their poor decision making. So much of our economy revolved around construction. When construction is down, then much of the economy also suffers.

Don't get too discouraged. This is merely a regular economic cycle that we go through. Today it is fuel. At other times, it has been something else. Just keep on plugging away and pay down as much debt as possible and you will be able to weather this downturn. Stay away from loads which are not profitable for you. As a friend of mine told me yesterday, if you have cash flow you can weather just about anything.
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Old 05-29-2008, 03:33 AM
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Today, the Trucking Bozo said that the US economy was "Scheduled" to collapse, later this year. This was to be followed by the collapse of the gov't, by mid-'09.

This is to pave the way for the north American union, and the amero.

This was exposed by one or more participants in a high level, secret meeting. It seems that they had become highly disturbed at what they were told, in that meeting.

I weren't there, but...

With the massive expansion of taxes, regulations and enforcement, we have been hammered from all sides, since 9/11.

It seems the politicians & gov't have done all they can, to beat us down. At the same time, they have wasted no opportunity to strengthen illegal aliens, our enemies and competitors, the world over.

For some reason, I keep thinking about that young Chinaman, that stood in front of that tank, in the square.
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Old 05-29-2008, 02:30 PM
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The only one of those things "scheduled" to collapse is the Bozo's mind...Early 2008, I think :roll: I'd say he should just stick to trucking but he can't even get that right.
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