A panel of trucking executives at the CCJ Spring Sympo- sium in Tusca- loosa, Ala., deter- mined that increasing fuel sur- charges isn’t enough to keep up with rising diesel prices, and that other cost-control measures are necessary to survive in today’s economic environment.
“That’s a constant battle,” said Greg Brown, president of Oxford, Ala.-based B.R. Williams, one of three participants in the “Trucking Through a Tough Economy” panel discussion on Tuesday, June 10.
Ken Adams, president of Birmingham, Ala.-based Southern Cal Transport, warned trucking executives that the gap between what’s paid at the pump and the shipper’s reimbursement is “a number you need to look at closely.” Southern Cal Transport has revised its surcharge gap “a couple of times” since diesel prices began climbing rapidly. “It may surprise you what that gap is,” Adams said.
Jeff Wilmarth, president of Rockford, Ill.-based Silver Arrow Express, said his company also has adjusted its numbers. “Customers have been very positive and receptive,” Wilmarth said. “They know the situation.”
Brown said with today’s fuel prices, surcharges aren’t covering the cost on empty miles. “That requires you to look at your whole freight pattern differently,” he said. Freight rates aren’t covering known deadheads, Brown said. “How to we reduce those deadheads?” he said. “How do we redo pricing on freight, on surcharges?”
Wilmarth said Silver Arrow is using a backhaul calculator and reviewing costs more frequently. The company also is reviewing drivers’ routes to cut empty out-of-route miles and to facilitate better utilization.
The three panelists said their companies also have lowered their highway speeds to curb fuel costs, but sometimes it’s a tough sell to drivers. “You’re asking the driver to put in more time for the same amount of earnings,” Adams said.
