How long will it be before Owner Operators get paid more?

The simple truth to the matter as far as FSC is concerned is this. Say a load pays $1.30/mile to the truck. FSC is what, about .45cpm? That essentially means that you are hauling that freight for .85cmp. Rates were higher than that back in the early-mid 90's. Not to mention the inflation of everything else that has incurred since then, but the fuel has easily what tripled in price. The FSC is a joke and a way for companies/brokers to save/steal money. Getting back to the OP, o/o's will start to make more money once the big companies cant support themselves with the little profit they make from each of their trucks. Either that, or u get these "people" to quit hauling cheap freight. Will it happen? Time will tell, but its suffice to say the end is nowhere in sight IMO. If people really want stuff to change go read about the shutdown thats comeing up. Although remembering the participation level of o/o's from a few years back, I wouldn't get my hopes up.

 

For this discussion on FSC you need to understand how it is designed to work. And sorry if my numbers are off, when I need it I get it from a service.

You start with a base rate of $1.25 per gallon. For every $.05 per gallon the price increases, the FSC goes up $.01 per mile. So if the average is at $3.50, the formula to figure FSC is (3.50-1.25)/.05= $.45 per mile.

So if you are getting better than 5 mpg, rising fuel prices will help you.

So this issue here is not the FSC, when used properly and passed thru to the truck, it works. The problem is that it is not being passed thru to the truck. It seems these days of rising fuel prices that the brokers are doing better as prices are increasing.

And if you are bidding for direct business you have better have FSC as part of it (and understand how it works) or an agreement that your price is good until fuel reaches X per gallon.

 

Not sure if that was a question or you are just trying to make a point.

 

I laugh everytime a read something in the news about how fuel prices are killing trucking companies and that it was a combination of less freight and fuel prices that killed companies the past couple of years.

Large companies are getting solid rates and are not the ones driving the rate to the owner operator down. That is an old wives tales that I have never seen proven on a large scale.

What killed companies was not the rates getting lower, as the did, but loosing business and not getting paid on business. If a large company went out of business because of fuel then they should not have been in this business to begin with. FSC is a standard and it covers the cost of rising fuel.

What is keeping the rate to the O/O down is mostly brokered freight. While not a lot of info is available unless you pay for it, the best report I saw on this was from University of WI from 2006. Back then, the O/O saw 60-70% of the rate the customer paid compared to 80-90% in 2001. And what had changed was the customer rates had risen and the O/O rates had stayed steady.

And more proof the big companies are getting solid rates. Do the reverse math on what drivers that are getting % of pay are making. I guy making $1.20 is taking his 60% out of $2.00 + fsc. And the better paying loads go to a company driver or LP on a fixed rate.

 

You took the words right out of my mouth.
I get passed a lot on the road & 90% of them is company drivers
No I do not have a slow truck & yes I drive slow in the right lane.

 

As has been said, when dealing with brokers, that is typically a one off deal and who cares about FSC. FSC is designed to protect you against rising fuel prices in a contract.

Now, the brokers that keep huge portion of the rate is a different discussion.