Swift Transportation’s shares dropped 14% after they announced their plans to invest more money into rectifying their driver shortage. While shareholders may not like to hear that a company is planning to spend more money, thus reducing their profit in the short-term, this could be good news for drivers and the trucking industry as a whole in the long term.
As the largest truckload carrier in the country, the “driver shortage” has been hitting Swift as hard as any carrier. So hard in fact that they have been forced to sell trucks that have been sitting idle due to a lack of drivers.
In response to the unseated truck count that was “higher than expected,” Swift announced that it would be spending more money on training new drivers and would be paying their drivers more.
They haven’t released any specifics as to how much more they will be paying their drivers, but in a letter to their investors they stated that “the best investment we can make at this time, for all of our stakeholders, is in our drivers. Our goal is to clear the path for our drivers by helping them overcome challenges, eliminate wait times and take home more money.”
Could it be that carriers are finally realizing that paying their drivers more might be an incentive for them not to leave?
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Source: joc, businessinsider, swifttrans
Image Source: flickr
I sure hope so, but you look at their business models, all the mega carriers are profit driven.
Well duh! What company isn’t profit driven? I’m a sole proprietor Owner Operator. Guess what drives me? PROFITS! Maybe one day as my profits increase I can offer you a job.
As a sole proprietor Owner Operator, I bet that every business decision you make is not solely based on maximizing profit. You probably balance your profit, your labor, and your lifestyle to a level with which you are personally comfortable. This is unlike large multi-proprietor corporations that ignore balance in favor of a desire for limitless profit to enhance the lifestyle of a few board members at the expense of a multitude of nameless, faceless workers who generate corporate profits while struggling to make ends meet. Just sayin’.
And how is it that you calculated legal liabilities or jail time if you make an error in your drive for profit?
Unless it is a non-profit organization, all companies are profit driven. Would you go to work if you were not getting paid? The problem is greed, it’s never enough profit.
True Joe, but even non profits must make money. No revenue, no operations, just as you and John R said.
There are lots of drivers, even you Joe, that basically work for free at some point.
Me? I try not to get caught in situations where I won’t be making any money, but sometimes it can’t be avoided.
As an example, I can’t buy and pull my own trailer. The company has it’s own trailers. I pull their trailer on toll roads all the time. Do you think I get reimbursed for paying tolls on their trailer. Most of the time, nope.
Yeah, but you do make money pulling their trailers, right? Tolls are one of your business expenses. The times that I do work cheap are still profit driven. For example I have a very profitable account pulling cars. That same dealership once in a while has some inops. I spend a lot more time loading cars that wont run, but I don’t charge extra. Is it because I’m a nice guy? No, it’s because I want to keep the good relationship and keep getting the profitable loads. If all they had was inops all the time, the price would be higher or I wouldn’t do it.
The issue with most large companies is greed. There’s always a scheme to make more, even if they’re making enough. It’s never enough for them.
Here comes the almighty one cent per mile raise…
LOL! Probably
I trained with this company back in 2011. They gave me 26 cpm. It would have taken me 5 years to make 41 cpm. I lasted about 3 months before I took a bath in the training money I owed them and went elsewhere. After 9 months I was making 42 cpm plus bonuses and extra pay.
They need to raise pay, but pay raises mean nothing when they short their drivers on payroll, or run such shoddy equipment it’s tough to get descent miles. The company needs to be reworked from the ground up.
Driver 26 cent per mile is good u just got out of training u think someone is going to give you a 110000 truck to drive with out experience and pay you 4G pm get real driver. One of these days if you live long enough you will understand. Another thing they train you and you took off like a their in the knight and you are hitching about cm get real swift will find you to get back their money so you should not be bragging. That’s my 2cent.
Steve, any company NOT “profit driven” is on its way to extinction; and deservedly so
Green Bay Packers are listed as a “non-profit” corporation yet players still like to play for them.
We know as truck drivers that Swift is just another big carrier who get’s contracts by under cutting everyone else. Why is it that the only way to grow your freight volume is to drop your rate and at the same time raise pay for drivers? That’s a recipe for failure. Would it not be better to adjust your fleet to a size that allows you to pay drivers and also make a profit with good paying freight?
I personally would never work for Swift just on their poor business model alone. But also because they have never had anyone leading that company that ever cared about the driver. Empty trucks in a recessionary high unemployment environment means your doing something wrong and the word is getting around.
I don’t agree with your first sentence. I work for Swift and run on a dedicated account up in the Northeast. This past year, we lost several stores because the other carrier on the account, Ruan, under bid us on several good mileage stores. I know this is just one situation and most likely is completely different in the rest of the country, but Swift isn’t the only company under cutting others.
Yet another way truck drivers end up paying for deregulation. The money everybody else saves on cheap freight comes out of our pockets in the form of low pay.
Normally that would make since. But swift is subsidised by the government. They can (wink, wink) train a driver and pay him half the industry standard for a driver at 26 cpm. Only haul freight at 90 cpm and there revenue 64 cpm minus there exsps. And there profit is still a quarter or better per mile. Now add the gobmnt check they get for the rookie.
Look at TMC., just a few years ago they filed bankruptcy. Now there buying new trucks and churning out new truckers at a brake neck pace. It didin’t take upper managment long to figure out how to make it profitable and increase there own bottom line’s. Make no mistake. This is profit driven.
i worked for them and their rules are not the dot rules. owned my own rig, example i asked for 2500 miles a week they said that would be illegal and not possible to run. that was bsck in 2008. ive since moved on and am much happier for that.
another thing with swift is they own everything like the lease program. own insurance,trucks and so on. if you lease their truck its not yours if you want to leave there the truck stays and you owe them while it gets put back into service. its things like this that goes accross the airwaves of america that leads to a higher turnover rate of drivers. so for them to raise the pay in hopes to keep drivers might not help at this point. people are wise to what goes on there.
p.s. what ever happened to ompanies caring about the employee. it seems to me if you take care of the ones whom make your wheels go round the rest will fall into place.
As a general rule, companies don’t care about their employees. Why did the unions come into existence? Employees revolting against horrible working conditions is why.
Why’s there always all this whining about companies don’t “care” about their drivers? What constitutes “care?” Anybody who goes to work for these companies like Swift should realize they’re never going to be anything but a little cog in a big wheel. If they don’t they’re an idjit. At best, I’ve always thought these big mega carriers were just a place for new drivers to start out. Put in six months to a year and find something better. Frankly, I suspect that companies like Swift probably care about their drivers as much as their drivers care about them. Which is, obviously not much. All you have a right to expect is that you get paid on time and that there’s a benefits program comparable to the national average. If the pay and benefits are inadequate and you’re not getting the miles or the hours you need, it’s time to put on your big girl panties and move on.
Oooooh….i DO like wearing panties! 😉 (shhhh)
Driver pay has always been 3rd on the list of driver issues. Drivers leave companies because they aren’t treated well and home time. Swift can’t address home time because there business model is their business model. But treating drivers better would cost A LOT more than driver pay.
This will help them recruit more drivers but retention won’t change.
And it is foolish to think Swift or any other big carrier “undercuts” rates. They get a premium because they have capacity. And capacity is the name of the game right now. They are turning away freight.
LIKE
(They need to add “like” or “thank” buttons here. C’mon TTR, you’ve got them in your forums, how tricky would it be for your newsmaster to add them here?)
I disagree. I think drivers would put up with a lot more if they were being compensated a lot more. Don’t forget, there was a time (before deregulation) when truck driving was a good job, so it’s not an intractable problem.
Some younger folks might not be aware that driver retention and pay issues are the direct result of deregulation. Here are the conclusions of one study, which I will link to below:
“The passage of the Motor Carrier Act of 1980 (MCA) promoted competitive rate setting, abolished carrier commodity restrictions, eliminated routing and geographic requirements, and promoted pricing competition. The impact of these conditions on industry employment and wages benefited consumers, but the changes occurred at the expense of truck driver earnings, service requirements, and union membership.
Reports of the dramatic impact of deregulation on the trucking industry began almost immediately after the passage of the MCA. Intense competition soon led to company failures and anecdotal reports of high driver turnover became routine and continues today. In terms of the basic conditions that foster turnover, the literature suggests that little has changed regarding driver turnover in the years since deregulation was enacted.”
Also shown by the study:
• Compensation and benefits were the primary reasons drivers quit;
• The higher the pay for drivers, the lower the quit rate;
• Frequent home-routings meant lower quit rates;
• Most interesting, and contrasting with industry conventional wisdom, was that the majority of the 379 “top managers of trucking companies” said that driver turnover “made no difference” among major factors affecting company effectiveness.
http://www.memphis.edu/ifti/pdfs/cifts_examining_driver_turnover.pdf
The obvious conclusion is that drivers quit because of the low pay, and trucking companies don’t really give a shit about it. I have long thought that high turnover works for the big companies by depressing wages. The more rookies on the payroll, the less the company pays to roll freight, right? Maybe that’s why trucking companies are willing to try anything to keep drivers…anything except increasing driver pay?
Was going to work for them in 2006 but learned real quick they talk AT their drivers not to them. Thought I was back in 1st grade. See ya no thanks. Best move I made.
As a current Swift driver I’m getting a 4 cent a mile raise..In a brand new t680..With plenty of miles..average more than 2500 a week. Home time is being addressed..or so they say..we’ll see. But overall a good company.
Hey Jim, I also work for Swift. I’ve been working with them for just over 2 years and while I agree that they are far from perfect, they are not awful either. I have a 2013 Volvo making 51 cents a mile on a dedicated account in the northeast. I’m also home everyday. So, I’m pretty happy where I am at. I feel it is what you make of it. Come at it with a bad attitude, most likely going to have a bad time. Approach with an open mind and a willing to “put in your time”, and the money will come.
23 yrs at one company, time for a career change…GREAT attitude! Looking forward to my next career. Trucking! Now i drive a truck…three months into this industry(back in 2006), i could see clearly that this industry needs over-hauling! From top to bottom…i live in the real world. People like you Bill have chosen to not see the reality of caos in this business. Great Attitude or Turning a Blind Eye? or Like my friend says 50% of the drivers at any company are happy and 50% are unhappy. Take off the rose colored glasses, and recognize the reality that the trucking industry needs to be OVER-HAULED! From the greedy Corporates to the blinded Swift truck drivers…But glad you’re happy! i may be a little envious…though i know that joy you have won’t continue, because….. IT’S THE TRUCKING INDUSTRY.
Sounds like 1997 all over again. Anyone here know what company I’m talking about? (ans. below) The party didn’t last long at that company, but the potential upside here, it was only about five, six years later that companies across the board were raising their cpm rates substantially. This time I’ll stay where I am and see if that happens again.
ans.: JB
4 CPM from what previous rate driver ?
What’s the new rate for you ?
New truck ? That’s more cost along with your pay raise.
Don’t look for any ” home time” you got to generate some revenue to cover the new deal with hopes they can turn some profit for the stock holders..
Next will be employee stock option to make it “your company”.
Just in theb company name “It Don’t’ Sound To Swift”
Bunch of geniuses there. Who would have thought that $.30 a mile wasn’t much of an incentive to work for 20 hours a day and be away from home for weeks at a time? So what are they going to do, give their drivers another $.05 a mile? yeah, that will work.
correction…otr is 24 hours a day….sit and wait…on duty,off duty not driving….still on duty as your are responsible for the load and rig until your are away from the truck for your 34 and the truck is in the company yard or your driveway…that’s 168 hours a week.
35 on 2500 miles or less. 875.00 /168 hrs = 5.20 and hour.
Want fries with that?
See McDonalds for a raise!
A “profit driven” model works for the owner operation. A big corporation needs to focus on its driver turnover. You pay the driver crap and he is going somewhere else. You need driver to drive the truck when all you sell is a service. There is no profit in a parked truck.
Owner operator*
The people in charge must be deaf and dumb at all these mega carries. Can’t they see that low driver turn over mean less money for everything from insurance, trainning, hiring, etc.
But 4 cpm means nothing. I was working out and makin 49 cpm plus all on duty time was 19$ an hour. Do the math. 2200 miles a week and usually got in 15 hours a week of work throwing tires off the back of my trailer. Plus holidays and other special pay days. But keep in mind I had to work for every penny. And worked hard. Throwing tires ain’t easy.
40cpm ain’t sht people. Neither is 45cpm. Wake up and demand better for what you do. Refuse to be a slave to these mega carriers. Refuse to be abused. You guys are worse then the battered women syndrome. U keep putting up with it.
Most of you guys are either to lazy to care, to stupid to understand , or just plain an idiot to put up with the shit these companies do to you.
WAKE UP DRIVER!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Climb down off the cross there, George. Most drivers are not in a position to be crusaders. They have bills to pay and mouths to feed.
How can you pay the bills with less then minimum wage.
As a O/O – if I was not “Profit Driven” then I would be driven out of business. So with that respect – I can understand why a company with a firm lock on continued business would seek to remove as much cost as possible. The easiest and biggest cost to eliminate is pay, next is training, then its a grab bag.
gee and when I first started driving I was making a whole .18cpm and living good on it too.
Swift is super crooked, crooks, cheapskates ,and liars, I have friends that worked there and they wouldn’t go back to save thier lives.
Driver shortages are calculated and expected, don’t kid yourself.
Sure their short on drivers….The bunk monkey pool is drying up… Here’s what driver pay should look like in the year “2014” ….7 days on the road to be in the truck….$800.00 ..(that’s automatic compensation to be “away from home” +…Mileage pay @ .50 per mile 2300 miles = $1150.00… just using that mileage + truck, trailer, cargo responsibility pay for all other time not driving but still responsible for @ 15.50 per hour 118 hours = 1829.00…Add that up . $3779.00 … Then you get a professional driver. Not a bunk monkey. Or dirty pig of some non English speaking towel head…
$3,779 per week? At say, 48 weeks per year? That’s more than $180,000 pay per year.
Let’s pick that apart; 2,500 miles per week for those 48 weeks @ $2 per mile average freight charge to the shipper = $240,000, out of which $65, 000 is fuel, $50,000 is equipment. We’re down to $125,000. Add in equipment maintenance (repairs, tires, oil, coolant, DEF, etc) for $10,000 and then overhead (dispatcher, office cost [communication, utilities, etc) at about $20,000 PER TRUCK and we have $95,000 left for the driver and for the shareholders’ profit.
Can the cost of fuel, tires, dispatcher pay, equipment, telephone, Qualcomm systems, mechanics, insurance &/or damage be cut very much, if at all?
The competition will set your freight rates for you, that’s a guarantee, so what’s easy to squeeze?
Us, the CDL drivers. So the trucking companies take “training pay” from the Dept of Labor, pump in as many as possible and use the new steering wheel holders to extend the truck’s range to 4,000 and in some cases 5,000 miles per week. At $2 per mile, that’s another $2,000 to $4,000 PER WEEK, or in other words, $100,000 to $200,000 per year, IF a “trainee” can be put in that truck every week. Obviously it can’t…but even half that time makes a lot more money and if that trainee actually hangs around for even a few months @ 26-28 cents per mile for 2,500 miles, only cost the company $650 to $750 per week.
That’s far easier than increasing freight rates. It looks like SWIFT has found out the supply of drivers able to pass a physical & criminal checks, willing to tolerate the abuse, DAC report crap and all the other trouble we have to go through, is running out.
You think the shareholders want less profit? The company has to make a profit to maintain the jobs and the owners are not going to approach shippers and say, “we are running out of even bunk monkeys to transport your stuff, ’cause we don’t pay enough to attract & keep even those rejects”.
That’s what trucking companies think of their drivers for the most part, and that’s why they treat everyone like a potential criminal.
Witness the collapse of the trucking business if fuel prices rise above $ 4,20 per gallon.
Worked for Swift for two years as O/O. For the first year we got out of it what we expected. Don’t fool yourselves people. All big companies have the same probs. Doesn’t even matter if it’s a trucking company or some other company. Second year we started having real problems. Our brand new 2012 T660 spent over 100 days in the shop in just 7 months. Most of the time it was down for a week at a time, we’d get to run for a couple days then have the same codes pop on the damn computer. After a whole month in which we were only able to run about 3000 mi, and used up all our maintenance and savings on repairs and hotels we finally cried uncle. Took the truck to their lot and asked for help in getting into another truck, moving to company drivers (cringe, but if they would have worked with us at all we would have entertained it) or just getting someone to actually FIX the truck instead of just clearing the codes and telling us to go on our way. We sat in THEIR parking lot for a WEEK. we made several phone calls every day trying to get someone, anyone to a) call us back, b) help us find a resolution to our lemon of a truck. finally on Friday, just before quitting time we got a shop rep to tell us “well lets put it in the shop and go from there” We took the keys in to the office and walked away. Since then we have moved on to a non-training company. We get treated 10x better and are easily making 2-3x more money.
At the time we left there was no amount of money they could pay us that would make up for the way we got treated. Bottom line, unless they change their ATTITUDE toward drivers they will not ever retain most drivers.
I have worked in another industry which paid its workers a low wage + insurance and contributed additional 15% to profit sharing. They were always training people to do the job. I never understood why they kept retraining people when the could pay the employees more and have a better trained staffed.
Sometimes, what is on paper isn’t the most practical.
Wife of a trucker
“Could it be that carriers are finally realizing that paying their drivers more might be an incentive for them not to leave?”
Doubt it. The carrier that pays their drivers more in an effort to keep them has an equal reduction in their profits, as outlined in this article.
The way for drivers to get better pay is two-part:
First, drivers need to be PROFESSIONAL. That includes attitude, work ethic (be on time), communication, honesty, appearance, integrity, treating the company equipment as if YOU were paying for it, PERSONAL HYGIENE, and a host of other attributes.
Second, drivers need to remember this: United we win, divided we fall. It’s a simple concept, and probably one of the most difficult things to achieve. Remember when practically every driver on the road was a Teamster? I’m not advocating for a “union” per se. At that same time, the trucking industry was regulated in a way that ensured moving freight from point A to point B was at a fixed rate. It didn’t matter who’s name was on the truck, everybody got paid the same. There were lots of other regs then, too. The airline industry was the same way.
Granted, back then the system seemed to have inherent flaws that bred corruption. I’m not advocating for a return to the days when thugs ruled the docks.
I am advocating for a return to, at a minimum, the regulation of the freight rates. A return to a time in the industry when even the small, one-truck operations could have a chance at making a go of it.
As it is now, the little guy is doomed if he/she tries to go it alone. The mega-carriers can do any given load cheaper than the little guy, simply due to the size of their fleet. The load that the little guy turns down because all he/she can do is break even, will be hauled by a 1000 truck carrier, even at a loss. They can do this because even if that carrier looses money on that one load (or even several loads from that customer) that loss, when spread across the entire fleet, is insignificant.
The small, one- and two-truck operations simply can’t compete.
And every one of the mega-carriers like the system just like it is: because it forces the little guy OUT.
Why do you think they have lobbyists in DC pushing for more and tighter HOS rules, along with higher insurance, tighter EPA regs, etc., etc.?
THEY can afford it (in spite of their whining to the contrary) and the little guy can’t.
The ATA is a perfect example of what’s wrong with the trucking industry.
truckers used to make on average $40 an hr a couple decades ago . today $10 an hr thats why i get sick of hearing old timers talk bad about the new drivers and how we dont care and it used to be different that ought to explain it
You can always come to work in BC and make up to 70cpm hauling super b or do what I do and run local for an average of $235 a day.
There is no shortage of good drivers. Just a shortage of good driving jobs .
Their statement was carefully worded:
“Our goal is to clear the path for our drivers by helping them overcome challenges, eliminate wait times and take home more money.”
So there is no mention of pay increases; only better focus on keeping the trucks moving. And since the drivers are paid by the mile, more miles means they will naturally be taking home more money. Of course, the drivers will be working harder as a result.
You all talk really good. I was just looking at Schneider. At the company I am at now as an O O I receive 0.55 CPM Fuel Surcharge. Schneider braggs a 0.405 dated 7/28/2014. I am lmao.
Y’all guesses it! It is a one cent raise!
Raise your hand if you’re tired of STOCK HOLDERS determining what you make an hour. It’s why everyone makes a lousy wage.
It’s not just the money! Big carrier’s need to realize family values are important these days! I drove for may trucking for a bit I made good money but I never seen my family. I was basically allowed to go home once a month for 3 days and were typically wanting me back sooner than that hounding me with phone calls. So I said screw it. My cdl now rots in my pocket because most local jobs with my experience level are shit jobs. GET US HOME and I’ll come help move freight again.
I just now deciding whether to go to a private school or go through (Swift) training school, etc. Wish I can avoid some of the lessons learned on trainee pay and changing companies within a year for a pay increase. Looks like a long road ahead.
Well I worked for swift they we’re full of s $!#. Those SOB fired me when I took off work for a month. I had a house fire I lost everything thing I had. When I informed swift I need to be home ASAP because I had a total loss fire. They made me fax in fire report from fire dept. Then they took 2wks 2 get me home. I was stuck in ny for 3 days no load coming out they say. They fired me 18 days later after I turned my keys in 2 go home to see bout putting my life back together. I had no service failures, accidents or tickets. I think swift should get what ever they got coming to them. The next company I signed with I got a .15 raise from what swift was paying me.
Worked out of their Richmond, VA terminal years ago and the Confederate, Rebel(lious) flag in their front yard told me all I needed to know.
$21.00 per hour and home every day. Reply to this post or contact me at “sirbyrd01@yahoo.com”.
Let’s get one thing clear….. THERE IS NO DRIVER SHORTAGE. There over 13 million CDL holders in the DOT database and over 40,000 issued every month.
Some truck companies are either too lazy to look for drivers, mistreat drivers, under pay drivers, can’t get them home on time or put them in reliable equipment.
There are also regulations and things called PSP & DAC.
I’d mention lease purchases but that’ll probably crash this site.
I meant to say unreliable equipment
After trucking for over 20 years I got smart. Haul crude oil in the bakken oil field in Williston, ND free housing $2250 a week. This is better money than I made driving in Iraq. Yes that is driving their truck.
I just changed careers to trucking. Started driving solo with swift two weeks ago. I was initially told I’d be paid .25 per mile. They had me start at .34 so this is definitely a true post! Though I can also say the pay bump is mostly for company drivers. Owner op took a couple of hits for the bad.