There are two ways that most carriers calculate the fuel surcharge. Percentage or cents per gallon. As was previously stated, if it is a percentage then it is based upon the line haul rate and added on to the total for the rate. If it is based upon using cents per increase in the price of a gallon of fuel then it can be calculated like this.
I use a base of $1.10/gallon as the base for my fsc calculations. Anything over that price is used to calculate the fsc. For instance, if fuel is $3.50/gallon you would subtract the base line price of $1.10 which would give you a difference in price of $2.40/gallon. If you use a mpg of 5 mpg, then you divide that into the difference to get your fsc. In this example, the fsc would be ($2.40/5 mpg = $0.48/mile fsc). If you use 6 mpg then your fsc would be (2.40/6 mpg = $0.40/mile fsc). Some companies will offer a smaller fsc for their better shippers. If you lease to a carrier they should give you your percentage of the line haul and then add 100% of the fsc to your part of the revenue. I seem to remember that Landstar started taking their percentage of the fsc along with their part of the line haul.
Most recalculate their fsc each week when the feds publish the average national price for diesel. It comes out every Monday. You can subscribe to the service at no charge and it will be automatically emailed to you every week. Another factor could be the regional prices as someone else mentioned. I have know of some who base their fsc using the regional average price for fuel and others use the national average for their fleets. If it is done regionally, it could be done based upon either from the point of origin or the receiving end. There are several factors which could be in play when calculating the fsc. The feds use a fsc based upon $2.50/gallon. Some contracts that I have seen the last year don't even show the fsc. It is all calculated in the rate.
If you lease to a carrier you need to ask how they calculate their fsc. Sometimes it is the shipper who dictates how the fsc is paid.
|