The Demise of Taggart Transcontinental
While the article focuses more on truck transportation than rail, the transportation crunch throughout the country is being felt. One major factor they failed to include in these calculations, however, is probably more important than the driver crunch: the cost of fuel.
I used to work for a transportation company, and I can tell you that in the transition from President Bush to President Obama, we saw our costs shift significantly, from being mainly employee costs to being mainly fuel costs. Where that comes into play in the open market is that the independent drivers have simply hung up their hats: they can't afford to pay pump prices and compete with the larger firms who can lock in bulk fuel prices - thus the shortage of drivers. When you are driving 1000 miles in a vehicle that gets 5 MPG, the difference between paying $3.40 and $3.50 = .10/gal * 1000 miles / 5 MPG = $20. Considering that a common driver makes $20/hr loaded wage and probably gets one or two trips per week like that, you can see how that can quickly make or break an independent operator.
I used to work for a transportation company, and I can tell you that in the transition from President Bush to President Obama, we saw our costs shift significantly, from being mainly employee costs to being mainly fuel costs. Where that comes into play in the open market is that the independent drivers have simply hung up their hats: they can't afford to pay pump prices and compete with the larger firms who can lock in bulk fuel prices - thus the shortage of drivers. When you are driving 1000 miles in a vehicle that gets 5 MPG, the difference between paying $3.40 and $3.50 = .10/gal * 1000 miles / 5 MPG = $20. Considering that a common driver makes $20/hr loaded wage and probably gets one or two trips per week like that, you can see how that can quickly make or break an independent operator.
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- 3Posted by $ jbrenner 9 years, 10 months agoYour argument explains why CSX has been one of the most profitable companies over the last few years. Trains carry more with fewer workers.Mark as read | Best of... | Permalink|
- 2Posted by SolitudeIsBliss 9 years, 10 months agoAnd don't forget all the additional costs of Training, Regulatons, etc. Businesses and trucking companies are being bombarded with so many new requirements for changing documentation, training, updated and changing regulations it seems these days that's all we do is try to keep up with new govt. demands.Mark as read | Best of... | Permalink|
- 2Posted by $ rockymountainpirate 9 years, 10 months agoI just had lunch with a friend today who is an over the road trucker. When all is said and done at the end of the year, he paid all his bills with his per diem. There was no profit. I keep asking him how much longer he's going to continue to pay them to let him go down the road. The environmentalists have also put truckers out of business. You had better have anew truck if you want to drive into kalifornia.Mark as read | Best of... | Permalink|
- 3Posted by Solver 9 years, 10 months agoA world without profit (gain) is a Marxist's dreamMark as read | Parent | Best of... | Permalink|
- 1Posted by $ jbrenner 9 years, 10 months agoAnd our nightmare!Mark as read | Parent | Best of... | Permalink|
- 1Posted by $ rockymountainpirate 9 years, 10 months agoIt sure is.Mark as read | Parent | Best of... | Permalink|
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-- 1Posted by $ blarman 9 years, 10 months agoThis is becoming a federal mandate - not just a California mandate. The use of fuel additives such as urea are now being mandated as well as in-truck monitoring and remote shut-down. Couple this with the hours-of-service and health requirements (annual physicals, etc.) and the barriers to even becoming a driver are going up.Mark as read | Parent | Best of... | Permalink|
- 1Posted by $ rockymountainpirate 9 years, 10 months agoTrue.Mark as read | Parent | Best of... | Permalink|
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