Question for my Owner Operator Brothers

In my honest opinon if fuel and gas gas to $5 a gallon or higher i do not think there will be much going on in any industry. The country in its condition at the moment can not and will not beable to handle $5 gas and fuel. I will keep raising my rates to cover the cost untill i can no longer and then shut down. I will not run at less of a profit just to cover higher fuel prices. If what there saying happens with gas and fuel prices i firmly believe what we saw in 08/09 will be a walk in the park compared to this time around.

 

Is this not the whole point of a FSC? The FSC should go up and down with fuel prices to take that variable out of the equation when setting rates. I don't use FSC's but this has always been my understanding of them. Yes??no??

 

$5 fuel will be an additional $.20/mile or so on fsc. Someone driving 18000 miles a year will see an extra $1000 is gas expense. These figures are a blip compared to what was happening in the economy back in '07. There is no economic correlation between $5 fuel and what happened in '07/'08/'09. Actually, some economist would say $5 fuel is a result of increased consumption because of increased consumer confidence. What happened in the past was a complete void of consumer confidence (over simplified I know) putting a complete halt on consumption.

Rates lag fuel price changes. Going up and down. The groan on rates this week will be accepted in the coming weeks as FSC catches up.

Biggest issue I am starting to see is the readjusting of how FSC is calculated to account for better MPG. The days of being able to run in the 6's and make more money as FSC increases will be going away. 7 will be the new 6.

 

Cut Back?!? H ell no!!!!! We are at the beginning of one of the greatest opportunities in trucking we have ever seen. Time to double down.

FSC is in contracts or rates are set based on fuel at certain level. When it stays above that level we reset.

 

Bill you keep thinking that. Higher gas and fuel had more to do with the down turn in 08/09 than you think. When and if fuel/gas hits $5 or higher this time we will whish it was 08 again. Nobody i have talked to company or individule has the extra cash or income to cover an increase in every thing they use due to higher fuel/higher living cost due to food and every day things increasing. An extra $1,000.00 a year is alot to a small family trying to get by. Equals no vacation or discretionary spending. Some of my customers have allready started seeing the affects on orders do to the higher energy costs. When it cost more to truck a product than they get selling it, it will come to an end. My line of work might get hit harder than others but this will not be a good thing, FSC or not.