All I'm saying is that what you guys see as leased operators isn't giving you a clear picture of what goes on at other levels in the process. For O/O's dealing in the spot market, what you say is pretty much true. I don't break down a quote on a load from the boards. But those transactions make up a very small percentage of the freight that gets moved everyday. If you're quoting a year's worth of freight, you're going to include a FSC if you expect to secure rates that adjust for costs. And most times, shippers want to see quotes broken down like that. It makes it much easier for them to compare and decide which quote is really giving them the most value. Shippers understand that the volatility of diesel prices makes for a tough operating environment. They don't mind seeing that incorporated in their costs. For the most part though, if they found out that half of what they thought they were paying due to the diesel market wasn't going for that purpose, they would expect an explanation. This happened last year when it became known that many carriers, including the LTL's were increasing their profitability due to the FSC's. Many shippers demanded that contracts be renegotiated. Fedex and UPS, in response to the outcry, lowered their FSC but were able to increase their rates. The TL carriers didn't have that kind of pricing power.
Just one final thought. Those of you that are paid % probably get 100% pass-through, and does that FSC vary depending on the load? Very few carriers charge a set FSC to all customers. Often, they don't even use the same criteria for all customers. Some customers may pay a FSC that on a per mile basis, others may pay a percentage. This is because different shippers prefer to deal with their costs in a certain manner. You can bet that if a carrier is bidding on 500 loads a month and the customer wants a FSC expressed as a percentage, that carrier is going to quote the customer in whatever form he wants. Additionally, carriers often give discounts or even waive FSC's altogether for some customers. So, if you're getting a FSC of $.50/mile this week, it's unlikely that all the loads you haul are actually paying that amount. Some may pay less, some more.
I don't think that a FSC regulation would necessarily result in more money in the O/O's pocket. But that hasn't been my reasoning in any of these discussions. It would be good for the industry.
