negotiating rates

Or...........

And......People are getting tired of this job, They really are.

The young Drivers stay perched for a bit,Then decide their hearts not in it-Come a new Batch..but the Batches are getting smaller and smaller.

Many Folks that started with me or before me are retiring.......The Younger generation shows no desire to work 12-14 per day.

 

Not for the 35k a year the megas pay for the first year. A huge part of the problem I think is how ugly this industry gives it to people right at the beginning. Happens for brokers too. Your first experience as a baby broker is a brutal death march of cold calls where you frantically try to build a half stable book of business before the clock runs out... Where you get paid 30-40k, and if you're on the higher side of that it's almost certainly a 50% pay cut.

 

You are real close. Increase consumption which directly means increased production. Just add in the extra demand caused by the relief and rebuilding efforts down south.

That's definately part of it. Every industry is seeing labor shortages. Even retail and the restaurant industry is having problems staffing their stores.

About rates: many of you are new to the industry so you don't realize just how low the rates have been the last ten years. What we are seeing today is not that much higher than they were from 95 to 06.

 

That's a good point. I started driving as a company driver in 2000. Became an owner operator in 2008. I didn't see an actual open market rate until 2011. So my experience with rates is a really small window.

I know boredsocial you jokingly say "get in on the gold rush guys". The truth is rates are now where they should have always been for trucks IMO. It's not really a gold rush. A more apt way to put it is it's now a good return on what is still a risky business. Most wannabes hoping to get in on the current wave will fail. I don't care how good overall spot rates are it's always a dogfight to get good freight and put together solid weeks.

But I'm under no illusion that it will last. My best hope, and something that would be good for EVERYone in the transportation business, is that when rates stabilize they will settle at elevated levels from the recent past lows. A rising tide raises all ships.

 

My best guess is that they settle to 2011 levels. Not as good as we had in the 90s and early 2000s, but much much better than 15/16 levels. Basically consistent 2 a mile in normal markets. Better in good markets like Chicago and lower in bad markets like new England and Florida.

 

Dude the cost of ownership on a truck including driver pay is very generously 1.60 a mile. If you're averaging 3 bucks a mile that means your profit margin running as hard as you can is 47.x%. The pharmaceutical drug industry with their government sanctioned monopolies are only pulling down 30%.

This is extremely temporary and probably some kind of bubble... and because the yield on trucks is so high the market will make sure that these prices come down asap because of new people coming in rapidly. You're all early to the gold rush so you're going to make a lot of money. Pity the poor ######## who are seeing this trying to get in, by the time they actually get going it'll be over.

 

Yeah we won't see 2015/2016 levels again for several years at least. That was really bleak and just as unnatural as the prices are now.

 

There you go again leaving out empty miles. I know for brokers they don't exist but for people out here running trucks it's reality. No-one out is booking every load as $3 a mile runs with zero % deadhead making 50% margins. Like I said. Rates are where they should be and no-one is stacking any gold bars out here running a truck.

 

@100%Gofio - I was paying $4/mi to $4.25/mi OB Chicago area on van all last week. Didn't matter where it was going. Cheapest I moved one for was like $2.94/mi heading down to Arkansas. That was what the guy offered before I could even give him a rate. Customer was pretty happy when I came in under the other broker working on the load by a grand. End of quarter, plus hurricane supplies, plus a general increase in available loads across the board all contributed to this. I know it's not limited to just van, either. Capacity is shot to hell right now.