What are you seeing out there?
 

I wanted to get everyones take on what your seeing out there work load wise.
I've been listening to CNBC a lot lately and some of the truck stocks are rising, Yellow, JB Hunt, and some one else, (I don't remember who), but these guys seem to like the trucks here lately, and they think that things are starting to pick up. I think it was on Fast Money they said that we're about thirteen months into the freight slowdown and we should start to pull out of it. I guess there looking at the average slow period being thirteen months. What are your thoughts on this and again what are you seeing out there now?

Construction has come to a grinding halt here lately, both residential and commercial, which is about the pattern. Usually when residential slows, commercial is about a year to 18 months behind, and it's here.

What I like to do every now and then is ask my suppliers what they're seeing because they have a much broader view than I do. I don't know if any of you do something similar in your business or not. If you do maybe you could expand on this a little also.

I expect the economy to be off much of this year. It should pick up somewhat in about a month, but I don't think it will be as strong as it was a couple of years ago. This slow down has been coming for some time. Investors typically get into markets before an expected up turn. Trucking usually slows during winter months and picks up again in spring. That is a normal business cycle for trucking. Some segments are not as affected as much as others. In any case, rates are not what they should be right now. Those who keep costs down and maintain fairly decent rates will survive, but I expect to see more going out of the business. Large companies merge to avoid bankruptcy. Small companies just go out of business.

I agree, I think it will be slow for the first half of the year, but with these rate cuts and another one possibly coming it might help later in the year. I don't think housing will rebound any time soon and that will have an impact on trucking, especially the open deck trailers. However, have you noticed lately that there is a lot of talk of infrastructure? Might be a buzz word because it's an election year but I'm hearing it a lot lately. That could bode well for trucks in the future I suppose, if there is an infrastructure boom (for lack of a better word).

What they want to do is raise fuel taxes, putting in toll roads and raising existing tolls to fund those projects. Elected officials have blown highway funds on pet projects and are trying to raise taxes in order to hide their mismanagement of public funds. They are doing anything they can to raise taxes in a number of ways. This will impact trucking more than the commuters. I just renewed my truck insurance and was hit with a major hike in rates, even though I haven't had any accidents or cargo claims. It seems that with all the failures of smaller carriers insurance companies are raising rates to compensate for the shortfall. According to my insurance company all of them are going up on their rates this year. I shopped around and even with the price hike, my current company was still cheaper than anyone else. With a sluggish economy this is not a good thing for trucking.

With public projects, they can project a false sense of doing well for the economy. All this does is hide or shelter what is really going on in the economy. These projects could help trucking in the short term, but could hurt us with higher taxes in the long run. Government doesn't seem to understand that higher taxes don't help the economy. Lower taxes and less government intervention will do more to stimulate the economy than anything.

All of the price increases will only hinder an already struggling trucking industry and economy. Those who can't control their costs and continue to haul cheap freight will not be able to survive. I don't want to be the voice of doom and gloom. This is just another challenge. We will survive this rough spot.

Your doom and gloom has totally ruined my Saturday GMAN. I'm going back to bed. :lol:

I am sorry to have ruined your day, Rosty. I don't think that things are all bad. I just think that we need to operate more efficiently. I expect to do well this year and have an increase in business. In fact, I plan to buy at least one more truck, possibly two this year. I think that there will be opportunities for those who plan and manage their businesses well. How is that for being more optimistic? :lol:

Just keep the costs down as much as you can and rates somewhat decent, you should be OK. I've been doing pretty good i might say for a dry van but compared to 2 years ago its not all that good.

This economy cannot go down, it can stay at the same place or slowly go up. People in this country like to spend money, thats what its all about.
Right now things are pretty bad with our dollar being lowest and with energy costs escalating. 9 trillion dollar debt is making us drag our feet in comperison with other contries so i dont see things picking up anytime soon, maybe some but notthing that would make us go ,,WOW''..

Even in todays time succesefull O/Op cannot fail if he or she knows how to handle different situations. Remember, it not hard to do good when times are good, those who do good or decent at least, when the times are hard are those who can call themselves real buisinessmean/women.
My payment is 1500 and together with insurance comes to some 2300 per month and am not complainin.....

Just keep on keeping on..its gonna be ok.

That's better, holy cow I was getting ready to drown myself in the pool but as luck would have it, the cover is still on, so tragedy was avoided. shewwww! :D

At what point (fleet size) do trucking companies self-insure?

Have you heard of 'Captive Insurance' companies?

Good Luck Ladies & Gents!

I am glad you were prevented from doing anything rash, Rosty.

Gman, I know you probably have seen some of these cycles before with capacity shrinking. The trend seems to be one of consolidation but I just read the below article and I have read elsewhere that the need for trucks is going to increase. I'm sure these big companies know the need for trucks.

Do you see a difference in the type of person today becoming an O/O rather than in the past? I remember talking to a dispatcher at LCT (that kid was great) and we were talking about Harvey Gainey the owner and in this kid's opinion he felt it was easier to get into the business back then; that it was easier to get contracts back then.

You know also I was thinking today, this morning TQL called and an O/O was on a load and went to pick up and he couldn't load as he had a hole in his trailer. It got me thinking, it's so hard to get a customer, yet these people will seemingly put the load on any schmoe with an MC number. In the end you get what you pay for.

I wonder if it was always like that, that they don't seem to care about service they just go on price. I remember LCT had a 75% on time rate, I don't know how they keep thier contracts.

Anyway here is the article:


Feb. 13) WASHINGTON, D.C. — Transportation is already a costly challenge for many in the produce industry, and things are likely to get worse.

That was the message Bruce Blanton, associate deputy administrator of the Agricultural Marketing Service’s transportation and marketing programs, delivered to the U.S. Department of Agriculture fruit and vegetable industry advisory committee during its Feb. 8 session here.

Blanton said U.S. production of fruits, vegetables and nuts is expected to increase from 203.6 billion pounds in 2007 to 228.7 billion in 2017. Meanwhile, horticultural imports are expected to increase from a little more than 30 billion pounds to more than 45 billion in the same time period, while exports are expected to climb from about 18 billion pounds to 24 billion.

“That’s steady growth,” Blanton said. “What does it all mean? Demand for transportation services is going to go up with it.”

Blanton also said the U.S. Department of Transportation and the Federal Highway Administration are “expecting a tremendous increase in truck traffic” on U.S. highways.

Blanton presented two maps, one that showed long-haul truck traffic in the nation in 2002 and another that showed estimated truck traffic in 2035. The maps used red lines to show traffic, and the lines became thicker according to volume.

“California is one big highway,” said Matthew D’Arrigo, vice president of D’Arrigo Bros. Co. of New York Inc., New York, after seeing the 2035 map.

That comment drew chuckles from his fellow committee members, but those maps and another set of maps illustrating the projected increase in peak period congestion on the national highway system don’t bode well for shippers.

Meanwhile, a 2002 study by the department of transportation estimates the driver shortage will reach more than 100,000 by 2014.

The produce industry has become increasingly reliant on trucks. Blanton estimated that 5 million truckloads of produce — perhaps more than 95% of all shipments — were moved by truck last year. That’s more than 200 billion pounds transported by truck, compared to 1.4 billion shipped by rail.

Rail might be a serviceable alternative to trucks in the short term for some commodities. According to the Association of American Railroads, many lines were below or near capacity in 2005. However, the number of lines projected to be at or above capacity by 2035 is staggering. The association estimates that its industry needs $148 billion in investments over the next 28 years.

“Fruit and vegetable production, imports and exports are increasing,” Blanton said. “All modes are close to capacity or at capacity, and congestion problems are expected to get worse.”

Blanton said the agriculture industry needs to communicate its needs to the department of transportation now rather than wait until the problem is more severe

Mandilon-

The agent I formerly drove for had about 70 trucks and some employee/local straight trucks. they were self-insured through a Michigan insurance agent, as they were based in Michigan.

HTH

I don't know that there is a certain fleet size which trucking companies decide to self insure. In order to self insure a company must have substantial assets pledged to cover losses and it must be approved by the Feds.

What do you want to know about captive insurance companies?

Not all of them. If they have lots of shipments they will need reliable trucks.

You know rank, the other day I was looking at the Sears DC and all I saw were Werner and Schneider trucks and you know these companies don't provide the most reliable trucks.

I mean they are too big. Remember that CH Robinson guy on here, I think he said JB Hunt are the worst; always late.

Then again, Walmart who doesn't take crap from anyone has Swift as their carrier so who knows maybe they do provide good service.

Schni,Werner may not have the most depenbable trucks, but they do have the ability to repower at will,....the small companies don't have that ability.

In the last week, I have seen 3 JB's in wrecks 1 jacked,2 on their side between PA and KS,...yet they still keep on going strong.

Merrick, all business runs in cycles. I do see some consolidation among the major carriers. However, something like 80% of the freight in this country is hauled by carriers who have fewer than 20 trucks. Think about that for a minute. Small carriers haul 80% of the freight in this country. Without smaller carriers this country would come to a standstill. Most of the larger carriers have brokerage departments. They cannot haul all the freight on their own trucks. Big companies are usually not very efficient and are slow to adapt to rapidly changing market conditions. A small carrier can respond immediately and win over the large carrier every time on service. The consolidation you see today will change. Some small carriers will grow and overtake some of these large carriers. Others will lose market share and become smaller either through loss of market share or by selling off part of their business. Schneider sold off part of their business capacity to Maverick a couple of years ago.

Unfortunately, I think the quality of drivers today is not what they were 30 years ago. There have always been whiners in this business, but I see more today than back then. We were much more self reliant then. Today, people want to have a company or the government do everything for them rather than relying on their own efforts. When a truck broke down or you had a flat tire, you usually took care of it yourself. Today, you call the company to send road service. People complain but are not willing to do what is necessary to make things better. Back then, most trucking companies were run by those who started as drivers themselves. Most had an open door policy with drivers. If you had a problem you could walk into the owner or president's office and get it solved. There was much more respect between drivers and management. Today, most of the major trucking companies seem to be run by lawyers and accountants who know nothing about a truck. All they know is numbers. A driver is considered an asset rather than a person.

Price has always been important in this business. However, I think this country was much more service oriented 30 years ago. If there was a choice between having good, reliable service and a cheap price, service would usually win. Today, many companies will take the cheap price and then complain when the service is not there. I don't think this is limited to trucking, but the country as a whole. We used to place value on buying quality. Today, it seems to be mostly about price. Having said that, I have NEVER tried to compete on price. I prefer to compete on service. If someone wants a cheap price, there are plenty of people who will haul a load at a cheap rate. I try to get a better price which is fair that will allow me to provide quality service to the customer. I believe this country is on the verge of changing the way we think about price and service or quality. There will always be those who place price above service or quality. I just don't plan on participating in a price war. I will negotiate on price, but will not lose money to get the business from another carrier. Some companies will pay extra for dependable service. Those are the customers that I want.

HE'S ALIVE!!! THE DOG LIVES!!!

Hell yeah the Dog lives!!!
I have been running the wheels of this old truck. The mobile internet isn't always good enough to get on.
I was also sick,sick sick, all last weekend sitting in PA for 4 days.

I couldn't agree more GMAN. I never really paid attention to stuff before but within the last few years that I have been getting busy and paying taxes etc, I am becoming much more conservative in my views (not socially; I could care less who marries whom, or smokes what etc).

You listen the to political speeches and it's like a crime for someone to work hard and save. If someone doesn't plan right and doesn't live responsibly it's not their fault. It's someone elses and the taxpayers need to pay for it.

I get health insurance now for free through my wife's work but before that I bought my own policy for $186 a month. I don't look to the government to take care of me.

They have some commerical on the radio all the time now about being in credit card debt and the commercial says it's not your fault, it's the credit card companie's fault. Unbelievable.

On a smaller scale, we had the president of the commnity association where I live. The monthly fee kept going up. We moved in it was like $150. Within two years it went up to $350. I knew this guy couldn't manage his own household finances yet he was in charge of the community.

Well big problems arose and to make a long story short, he's out and now the fees have dropped substantially. In the same vein, I don't want the government that contstantly is running deficits asking me for more of my hard earned money to waste. And I don't want to pay for health insurance for someone who decides to buy a fancy car instead of setting their priorities straight.

Well that's my soapbox rant for the day. :)

There are no free rides. Somebody needs to work and earn the money. They want us to think that this government health care won't cost anything since the government will pay for everything. Who do you think pays for the government? I am amazed that so many people don't understand that there is NOTHING that is free. The price we pay for a socialist government is one that we cannot afford. Health care is NOT a right. It is everyones obligation to take care of themselves and their family. The government cannot do anything well except find creative ways in which to pick our pockets. :evil: