Truck Load Rates Halt 8 Week Slide 2.0

Sounds like they were already hauling the freight cheap as they could and their customers still cut them for someone cheaper.

I am thinking these shippers are going to pay when freight picks back up and there is no one around to haul it because they bankrupted half the industry. I will look forward to that day.

 

The day will come in some time, maybe in September of 2024 and it will last for a year and a few months.
Unfortunately for us, the existing players, there's nothing special about this industry that would prevent it from regrouping and regrowing too fast to our liking.

 

Shippers are going to demand cheaper and cheaper contracts the longer this downturn lasts.

Sure is a good time to have paid off equipment.
Loving my old freightshaker right now.

 

And it will because the systems designed to. It’s set up to easily expand or contract as necessary. To be fluid. Keeps everything moving. Whether it’s existing Carriers and Brokers or New one’s entering or Leaving. Supply and Demand corrects itself. Back in April or May 2013 things started picking up after a very low bottom of an unprecedented 6 straight year’s of dropping Tonnage. I recall Werner had recently downsized their Fleet ( for the first time ever) by 1/3. Imagine Non Union OTR Drivers being Laid off. Unheard of. That showed Me the bottom was near. They aren’t going to move freight at 0 profit, just to support Drivers. I had no choice, but accept $1.30-$1.40pm loads. I hauled a lot of scrap. That along with a few other steady commodities like paper, oil dry, all the crap nobody wants. Things picked up quickly after a couple months of improvement. I got a Coca Cola Load paying over $3.00 pm. The Broker said he bid it high, due to them shutting him out in the past. The backlash didn’t last long. Soon as produce season ended. Reefers started competing in the Dry Van Market as always. Rates went back to a stable amount. Always just a little bit less than what they need to be. The spot market ie Load Boards always have the crap nobody wants. Mixed in are the Loads that are inconsistent. Some commodities are just not steady. Always buying and selling at different prices and different times. Those pay decent. Usually because of the time and effort involved in making the deal. Once sold, it’s got to go, usually last minute ASAP. Like Produce. The rest is the garbage a Carrier doesn’t want or doesn’t need. The Brokers get squeezed too. When rates were up, they were squeezed by the Trucks. Now they getting squeezed by the Shipper. Anyone who thinks the Brokers are always at an advantage should sell they’re Truck and open a Brokerage. Try competing with huge 3pls. like Ryder, TQL, Convoy, Coyote , and all the Big Carriers into Warehousing Logistics like Schneider, XPO, and dozens more.

 

If you noticed he said well managed. Well managed would mean not relying on financing to expand or update equipment. When I was a driver for my old boss we weathered 08 and 09 just fine. Yes it was slow and yes we usually sat out on the road for a day during the week because there was nothing to haul. But when things started to get bad he was honest with us drivers about the health of his company (around 15 trucks at the time) and he said if we stuck it out with him that things would eventually turn around and be good again. And all of us did. The big thing was equipment payments. He didn’t have many. If he did finance to keep his money in the bank he never financed a new truck and trailer. It was only ever one or the other. 2 different times over the years I was there I was sent down to Boise to pick up new trailers and he sent a check with me to pay for them.

So like you not having a payment not every company is financing when they upgrade or expand.

 

Yeah but contract is still better. And it sounds like you've already got a plan to not haul anything under $2 a mile. No need to really limit someone else that might be more competitive than you or, even more desperate. If they can do it let them knock themselves out. What gives anyone the right to tell someone else they will ship their products for $x.xx amount but not a penny less? I dunno about you but I actually like that I can get #### shipped free from Amazon for a marginal annual fee.

 

Right now inflation is having a huge impact on the rate reductions in shipping. The cost of consumer goods has risen a lot over the last year, and receivers of those goods are screaming at manufacturers (aka shippers) to put the brakes on their pricing. If a manufacturer's costs for making products goes up and their customer base is having trouble paying for it, you cut costs anywhere you can. That includes cutting staff and of course cutting the shipping costs of your products. If shippers have contracts with freight carriers and the bottom falls out of the freight rates, no shipper in their right mind would continue to pay double or triple the current spot price to get their products to customers. So they demand a renegotiation of the contract, or they just cancel it, like what happened to the company in that video. I relied on contract freight during my short time as an O/O and I was getting no less than $4.60 per mile from all of my customers, some much more. But I have no doubt that they're moving that same freight today for less than half that cost, and I picked the right time to retire. The trucking industry has simply gotten too volatile for most to survive getting in now. The boom times were never the norm, but the bust times are exactly that now. Good rates are too unpredictable and short-lived to make a long-term strategy in the business. Small companies need some kind of reasonable stability to survive. Trucking just doesn't offer that, and right now nothing else out there does either. Everything is a crap shoot.

 

Or one does not gouge their customers on rates like I haven't.

 

Why don't you tell me about it, Goldman?

 

Anyhow,

This week was the poorest I've had for a while. The loop consisted of 3 legs: $3220 on 1490 miles: $2.16 p/m : Wed - Fr - to deliver on Monday at home location.

It is what it is.