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Yahoo headline just posted- with rising diesel costs, truckers see the end of the road Locked

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Posted by selector on Sunday, March 9, 2008 11:35 AM

My comment may just show my lack of understanding (surely not the first time...), but it seems to me that, once we fool ourselves into thinking that we have it all solved, and we continue to amass our numbers on the Earth's surface, we will still be consuming oxygen.  We will need oxygen to get the algae to do their little thing (maybe not?), and then we will need more oxygen to burn the fuel to have more transportation to get more of us to where we want to go.

You can't fill a bathtub when the plug is out of place.  The plug orifice is miraculously eroding all the while, with the result that it's diameter is increasing.  There can't be a good end to all this.

-Crandell

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Posted by SactoGuy188 on Sunday, March 9, 2008 1:12 AM

What I find interesting is that we're kind of forgetting trucks run using diesel engines.

Remember, when Rudolf Diesel built his first prototype engine in 1893, the primary fuel was peanut oil, essentially a vegetable oil product. Given the developments with making biodiesel fuel in the last 40 years, we just about have the technology to refine diesel fuel from "growing" oil-laden algae on a huge scale, which means essentially a truly renewable biomass base for diesel fuel. That means even 20 years from now, tractor-trailer trucks and diesel-electric locomotives will still run around the USA, but now we'll refine the fuel from biomass sources instead of from crude oil.

With today's diesel engine technology, they will soon be just as clean-burning as gasoline engines, thanks to better diesel exhaust emission controls to remove diesel particulates and NOx gases. 

 

 

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Posted by Railway Man on Sunday, March 9, 2008 12:03 AM
 ValorStorm wrote:
 Railway Man wrote:

From 1996 to 2005, rail market share of total U.S. ton-miles increased from 33.0 to 38.2, while truck increased from 25.4 to 28.5. (per BTS). 

What's "BTS"?

Bureau of Transportation Statistics, an agency of the U.S. Department of Transportation

http://www.bts.gov

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Posted by greyhounds on Saturday, March 8, 2008 11:24 PM

 leftytrucks wrote:
Current fuel prices are nearing 80 cents per mile, almost triple what it was 5 years ago. If something doesn't change, our economy is coming to a halt! No, the railroads CAN NOT pick up much of the slack - too many abandoned lines, too many cities with no rail service. Intermodal HAS to ease some of the burden, but... In transportation, it's a fact - move 20 tons in 2 days, call a truck / move 200 tons in 2 weeks, call a train. The sooner both segments learn they are part of the fabric of this countyry, not teen-agers playing petty games, the better off the good ol' USA will be!!!

Well, essentailly, I agree with Lefty.  I'm going to disagree around the edges - but IMHO he's got it just about right. (I don't think the US economy is coming to a halt.  It's going to be slow going, but not a halt.)

Basically, a train and a truck are just two rather large tools that do the same thing.  They produce place and time utility.  What that means is that a head of lettuce grown near Salinas, California is of no use to anyone in Chicago unless it is placed in Chicago by a train or truck and is available when someone wants to eat a salad.  The tools put the lettuce where it is needed when it is needed.

Ideally, we'd have craftsmen selecting the right tool for the right job at the right time.  In this example these craftsmen are the logistics managers for the food distributors/grocery chains.

They can use a truck, or they can use a train, or they can use a a combination of both tools to do their job of putting the lettuce where it is needed when it is needed in the most efficient manner. 

Unfortunatly, we've got a legacy of Federal economic regulation that prohibited the craftsmen from using their tools in the most efficient manner.  Absent Federal regulation we were headed to an integrated system that used each tool, train or truck, to its best advantage.  The Feds put a stop to that, and now we're going to pay the price.

Due to past Federal economic regulation the railroads are undercapitalized and don't have a lot of capacity to be used.  What's the answer?  Well according to the Democrats it's more Federal economic regulation. 

We're going to have to dig out of this mess with more rail intermodal terminals and more rail capacity because those fuel bills aren't going back down.

But we're going to have to dig and that ain't gonna' be fun.

And Lefty, the rails can do overnight delivery on 20 tons at 500 miles.  I did it at the railroad between Chicago and Memphis.  Aside from those few things, you're right.  

 

"By many measures, the U.S. freight rail system is the safest, most efficient and cost effective in the world." - Federal Railroad Administration, October, 2009. I'm just your average, everyday, uncivilized howling "anti-government" critic of mass government expenditures for "High Speed Rail" in the US. And I'm gosh darn proud of that.
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Posted by Anonymous on Saturday, March 8, 2008 3:12 PM
Current fuel prices are nearing 80 cents per mile, almost triple what it was 5 years ago. If something doesn't change, our economy is coming to a halt! No, the railroads CAN NOT pick up much of the slack - too many abandoned lines, too many cities with no rail service. Intermodal HAS to ease some of the burden, but... In transportation, it's a fact - move 20 tons in 2 days, call a truck / move 200 tons in 2 weeks, call a train. The sooner both segments learn they are part of the fabric of this countyry, not teen-agers playing petty games, the better off the good ol' USA will be!!!
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Posted by alphas on Saturday, March 8, 2008 11:45 AM

My thoughts on this entire energy situation:

1.  Everyone talks about alternative fuels.   That's fine but if the alternative fuels are as expensive as oil/diesel are now or in the future, then not that much has been accomplished.  Commerce and consumers will continue to suffer.   The USA has built its economy on rather cheap energy and cheap food.   We're in trouble now because both have gone up.

2.  Other than the increases in energy and food demand due to world growth, particularly in China and India, the main cause of the USA's problems in these 2 areas is due to poor decision making in Washington as well as some of the states, going back many years.   The unbelievable hold the environmental movement has on politics and the news media is the main cause of it.   Therefore, there's been no movement in the USA for years on nuclear power, not enough on the use of coal, and no real major opening up of both the existing and the newly found oil and gas reserves (and the media as a whole keeps ignoring this issue so the average American has no clue that the USA isn't running dry as the  "greens" keep trying to tell us).  Then we get government decisions, appladed by the news media, such as the push for corn ethenol that not only don't work due to the high costs, they actually have a substantial negative impact on the cost of food--not to mention that they aren't turning out to be environment friendly after all.

3.  Some sources at my former employer, a major university, whom I have learned to trust their judgement over the years tell me that the USA could become basically independent on foreign energy other than Canada and a little from Mexico in about 10 years if the government would allow major increases in the USA's energy production and processing of its known sources, let alone what is discovered in the coming years.  It should result in much lower energy prices for all and can be done without any real negative impact on the environment.   But politically they don't see it happening since the Democrats almost to the man/woman aren't going to buck the environmentalists and too many Republicans are afraid to.   

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Posted by ValorStorm on Saturday, March 8, 2008 6:47 AM
 Railway Man wrote:

From 1996 to 2005, rail market share of total U.S. ton-miles increased from 33.0 to 38.2, while truck increased from 25.4 to 28.5. (per BTS). 

What's "BTS"?

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Posted by switch7frg on Thursday, March 6, 2008 9:18 PM
passengerfan; I was amased at how much your post is like ours was . My bride was with me as a second string driver. We retired in Nov. last yr. After the kids were grown , empty nest got to her and she said " move over big boy" , my turn now. I had 52yrs. driving behind me , she had  almost 10 yrs. Then our friend Flat Wheel died in Wisc. at a pullout rest stop. We were in Bismark when his wife called us . She asked Shirl if I would bring his truck home to Enid Okla.Shirl took Rattler to Enid to wait for me. That was the longest saddest trip ever made .  That was the ( pin puller ) for us. Both of us still get a twinge of wanderlust when traveling so. bound on I-17 at times. Now I got a Osteo pop and lock gear shifter shoulder LOL. Much of the hassle and other things were the same as yours .The best of good to you and yours ~~~ Respectfully , Cannonball & Shirl.

Y6bs evergreen in my mind

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Posted by Anonymous on Thursday, March 6, 2008 8:53 PM

Good luck with ye Passengerfan.

I came off Spotted Wolf once on a set of new tires but poor braking one day. I probably had to reduce the life of those tires by 20% because of poor Jake performance but remembered my old mountain training decades ago. Indeed I heard the voice of my loud and profane trainer next to me during the problem telling me what a dum dum I was and that I should do this or that.

Trucking is not so routine, neither is airtravel. When we take a journey it might be all there is for us.

Cheers.

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Posted by passengerfan on Thursday, March 6, 2008 8:07 PM

After 28 years in the trucking industry I am a little surprised by some of the comments I have read here.

I was in it before deregulation and after it took place and as much as everyone myself included expected big changes they did not happen. I was in a very secure segment of the trucking industry so never had to look for my own loads in any part of the country I was in.

But have seen all the loads posted at truck stops and wondered how O/O ever paid for their fuel at some of the rates I have seen posted. I realize how nice it is to get home to momma as much as the next guy but if I would have had to haul for some of the rates drivers are hauling for today I would have hung it up more than fifteen years ago as I did.

The reason I hung it up was health took me off the road. When a driver fails to pass his annual physical he really has no other choice even though I personally know drivers that did not let this stop them they simply found unscrupulous Doctors to fill out their physicals for a price.

I often wonder how many drivers are still out their who should not be driving. For me it meant a totally different career change. I sold my three trucks enrolled in school and became a tax specialist. I have a few regrets like everytime I pass a big rig today when I'm travelling the highways. But only for a brief second. My wife who used to run with me after our kids were grown and gone from the nest doesn't miss it either. It took some adjusting to get used to a life like most normal people have but I'm not sorry.

I remember an incident that occurred about a year before I gave it up where I was travelling up I-15 from LA  on a wednesday night and just before arriving in Barstow saw the flashing lights of emergency vehicles and pulled over when I saw it was a big rig down in the median that appeared to be alright. The CHP told me the driver was from Michigan and had suffered a heart attack and died. Fortunately he had got it stopped without injuring anyone else. It made me finally start to think I wasn't infallable and it really came home as that driver was younger than me at the time. I thought how awful it would be for his wife to receive a phone call from the CHP or maybe local law enforcement to tell her how her husband had suffered a heart attack nearly 2,500 miles away and would not be driving the rig into the driveway again.

I'ts taken some getting used to trading an office for a big rig but I really would not change my life for anything today.   

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Posted by Anonymous on Thursday, March 6, 2008 7:05 PM
 zardoz wrote:

 Bucyrus wrote:

....The answer will be political rather than engineering or scientific. 

I'm thinking it will more likely be economics...

 Bucyrus wrote:

Expect many new federal controls on how large our vehicles can be, and how many miles we can drive them in a given time. 

Not in an election year!!  Or two years before an election!!  Remember how popular the nation-wide 55mph speed limit was? 

There's no way any candidate that wants a personal political future would even think of suggesting that we get rid of our 3-ton chrome mountains; after all, how is Joe Sixpack going to compensate for his phallic inferiority complex other than driving around in some behemoth? 

And of course don't forget Mrs. Soccermom, who needs a 7-seat Land Bruiser/Yukon/Expedition to take her precious little darlings to ballet practice, then shopping for compact flourescent light bulbs so she can "protect the environment".

Perhaps instead of creating federal controls on our driving (a bit too totalitarian for me), how about requiring vehicles to be electronically regulated to a maximum speed, with the penalties for tampering sufficient to disuade people from even trying?  Not only would it save oil, it would save lives.

Or perhaps an educational program sponsored by the feds, explaining to the citizens how their wonton use of oil serves to support the political unrest in the middle-east and elsewhere (Venezuela comes to mind). Wouldn't it be fun to be able to tell OPEC where they can shove their oil?

As long as the big oil companies are in bed with the political 'leaders' of the world, all of our grand ideas of alternate fuels, alternate lifestyles, and alternate thinking, will be for naught.

You bring up several interesting points.  When I say the answer will be political rather than engineering or scientific, by political I mean government mandate.  And it is too totalitarian for me too, but that is what totalitarians do.  You are right to not expect it ahead of the election.  I would not expect that either, but I was thinking it would happen after the election.

In addition to mandating smaller cars, everything about the speed control you mentioned plus much more in the same vein will be a reality easily within ten years.  I'm told we all want change.  Our driving habits will certainly change.

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Posted by zardoz on Thursday, March 6, 2008 11:55 AM

 Bucyrus wrote:

....The answer will be political rather than engineering or scientific. 

I'm thinking it will more likely be economics...

 Bucyrus wrote:

Expect many new federal controls on how large our vehicles can be, and how many miles we can drive them in a given time. 

Not in an election year!!  Or two years before an election!!  Remember how popular the nation-wide 55mph speed limit was? 

There's no way any candidate that wants a personal political future would even think of suggesting that we get rid of our 3-ton chrome mountains; after all, how is Joe Sixpack going to compensate for his phallic inferiority complex other than driving around in some behemoth? 

And of course don't forget Mrs. Soccermom, who needs a 7-seat Land Bruiser/Yukon/Expedition to take her precious little darlings to ballet practice, then shopping for compact flourescent light bulbs so she can "protect the environment".

Perhaps instead of creating federal controls on our driving (a bit too totalitarian for me), how about requiring vehicles to be electronically regulated to a maximum speed, with the penalties for tampering sufficient to disuade people from even trying?  Not only would it save oil, it would save lives.

Or perhaps an educational program sponsored by the feds, explaining to the citizens how their wonton use of oil serves to support the political unrest in the middle-east and elsewhere (Venezuela comes to mind). Wouldn't it be fun to be able to tell OPEC where they can shove their oil?

As long as the big oil companies are in bed with the political 'leaders' of the world, all of our grand ideas of alternate fuels, alternate lifestyles, and alternate thinking, will be for naught.

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Posted by Anonymous on Thursday, March 6, 2008 10:49 AM

understand this, i dont care if fuel is 20.00 a gallon if the rates keep up with it who cares?

anoth er thing, the rates now are really low for the division im in (enclosed cars) the rates aredown by regular freight they should be about 2000 dollars a car maybe a lil more for seattle, wa to new jersey that is the ENCLOSED RATE    not the open rate if i put 6 cars in the trailer for that price you can make a good living but the rates are way down due to brokers and other transporters driving the rate down BECAUSE THEY TAKE IT it takes 2 seconds to take a s*** paying car ant it will take 2 years to get the rate back where it should be because when the carrier takes the car aT a low price the shipper knows that we will pay it therefor they get more money and we take a beating thats WHY I WILL NOT HAUL CHEAP FREIGT and you shouldent either dont put something cheap on the trailer just to it covers some of the fuel because you know what ? youre driving the rates down you know what   LEAVE THAT S*** SIT THERE they will figure out that if it dont pay good enough it WILL NOT MOVE they put a good rate on it and boom its on the trailer. why is it so hard to get into some peoples heads?

 even if you have to wait an extra day for a good paying load it will be better in the long run

because with out TRUCKS AMERICA STOPS trains do a little but you cant get that thing up to yhe grocery store can you?

please take in consideration from what i just said it will payoff in the long run

                    say no to cheap freight!!!
 

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Posted by jeaton on Thursday, March 6, 2008 8:59 AM

Ulrich

At other times on this forum I have suggested that there is more to moving freight from here to there than just getting the cheapest price from the trucker, railroad, forwarder or whoever.  For a very brief time in my career, I worked for a company with the single objective of getting the lowest freight rates offered by anybody with a truck.  Talk about fun.  Problems ranged from the deliveries being days late, like 5 days to get a thousand miles down the road, to promises to pick up a load never filled.  And a boss who ordered the staff to "make" those truckers perform. 

Obviously you and your clients understand that there are more ways to skin the cost cat than shopping for cheap.  Trucks and drivers are high cost elements of the system and need to be used hauling freight over the road.  One of my "favorite" examples of waste is having a driver unload and sort freight box by box by product and sometimes production batch.  Meanwhile a rig costing in the 6 figures sits doing nothing to earn a buck.

Good work.

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Posted by Ulrich on Thursday, March 6, 2008 7:22 AM

MP173, I run flatbeds and box trucks. For the most part my rates don't depend on equipment type.

My rates are based mostly on my ability to MANAGE my customers' transportation needs...and much less so on the actual grunt work involved in shleping the goods around. For example, I will go into a shipper and evaluate their production and shipping needs. I will work with their various departments to develop a transportation program (with measurable targets and precise time lines) that meets their shipping needs and budget. I then implement and manage the program. In other words I get paid for my ability to think...not for my ability to come up with a box truck or a flatbed in an oversupplied market.

The other thing is called "branding"...I'm known among my clients as a "top performer"...and top performers in ANY endeavor get paid top dollar. Hey...anyone can lace on a pair of runners and go for a jog...but only a few can do it and get paid millions for it. Likewise...anyone can supply equipment..but only a few can manage as above and come through every time.  

About being "productive". The big box retailers have  alot of us fooled. You CAN cut prices and LOOK efficient on the cover of a business magazine. But what is really happening? Let's call it for what it is...they're so efficient because they're able to tap into CHEAP LABOR...they're wonderful efficiency would dissipate in a heartbeat were they to make their cheap trinketry here...employing people who require a living wage. I too could probably hire drivers as "contractors" thereby avoiding payroll tax and the cost of benefits...however I don't because my name is on the business and because my own sense of decency and fair play does not allow it.

 

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Posted by Anonymous on Thursday, March 6, 2008 5:56 AM
 selector wrote:

 

It seems that hybrid cars have considerable currency suddenly, and everyone who sells cars is on the bandwagon.  There is a market.  But, these cars cost more at the outset, and I don't even want to contemplate what surprises are in store for those who have them when they need replacement energy storage devices.  They won't be cheap.  Also, getting "rid of" the cast-offs won't be cheap...think recycling fees....steep fees.  Heavy metals and all that stuff.

-Crandell

I think hybrids mostly sell because they have lower emissions, or because they make that statement; as opposed to offering an economical advantage.  And while they do have lower emissions, one must question their overall "green-ness" with all those batteries, since batteries are relatively un-green to produce and get rid of.  I have heard that, considering the cost and life of the vehicle and its batteries, hybrids cost more than a conventional vehicle even though they get better fuel mileage.

No I am afraid that there is no magic bullet for the mounting fuel/environmental stress of driving.  The answer will be political rather than engineering or scientific.  Expect many new federal controls on how large our vehicles can be, and how many miles we can drive them in a given time.  This rationing of personal transportation will be the ultimate solution for our U.S. village.

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Posted by Anonymous on Wednesday, March 5, 2008 9:06 PM

Let the build the stuff at the border and take it to thier Cities in CA. We dont need to drive a single mile further into that state than we have to.

There is a HUGE amount of room down there along the Border with California.

Not surprise that talk still persist.

If we wait long enough the BIG ONE will drop the state of CA into the ocean pernamently and we will have to get our produce somewhere else.

Personally Ive had good luck with the engines. Ive always opted for big horse because if they are going to load it down with emissions choking crap it's going to require a certain amount of useable horses at the tires to haul a pallet.

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Posted by edbenton on Wednesday, March 5, 2008 7:16 PM

Trouble is CARB that being the Commuinst state of CA Air Resource Board is going to be hurting the 8th largest economy in the world if they do not back down from the truckers.  Everyone I am talking to is saying the same thing they want it in their state they can meet it at the border they want all that produce hauled out same thing we are not going into there.  It is not the independants saying that either Mega fleets are doing the same.  By 2010 the only engines allowed in CA for anything Diesel powered in trucks is the new standeard it was supposed to be 2012 but they changed the rules on everyone.  Trucking companies are having to replace all the reefer units and all their tractors to run there and that will cost them BIG bucks to do and all the new stuff is so screwed up it can not go more than a week with out failing for 3 weeks. 

 One company I know of is looking at 300 million to replace everything it has another needs 200 million were are they going to raise that capital and also have money to pay for it say Hi to higher food costs.

Always at war with those that think OTR trucking is EASY.
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Posted by blhanel on Wednesday, March 5, 2008 6:05 PM
 MP173 wrote:

For my 6'7" frame, it isnt comfortable, but anything other than 1st class isnt.  Generally, I limit my flights to 4 hours or less.

I feel your pain, Ed.  I'm 6'5" and find the smaller commuter planes practically intolerable. 

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Posted by selector on Wednesday, March 5, 2008 5:56 PM

Thanks, Ed, I believe you are right now that you mention it.  It had slipped.  When you say tank cars, you are talking rail...yes?   There's a load I hadn't ever considered. Shock [:O]  Inedible tallow as a precursor to Vidal Sassoon, Pert, and Head & Shoulders.  Who says the beef industry is dying?

-Crandell

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Posted by edblysard on Wednesday, March 5, 2008 5:46 PM

Crandell,

Believe it or not...most shampoo, soaps and cosmetics are made from in-edible animal tallow.

Rendered down...we get hundreds of tank cars a week from Tyson Foods, South Dakota, full of either edible or in-edible tallow.

Edible for food production, (lard) and in-edible what is termed industrial or commercial production, (soaps and such).

 selector wrote:

I have enjoyed the commentary, everyone.  Thanks for your thoughts.  I can't seem to find it on yahoo's home-page just now, but earlier today their headline section had one about citizens in the USA changing lifestyles due to rising energy costs.  I was on my way to somewhere else and didn't get to have a quick glance before it disappeared in due course.

Everyone seems to have accepted that energy costs will rise, sometimes sharply, if the headline has weight.  But, as some of you have suggested, we'll still want stuff delivered somewhere within a Saturday morning's shopping spree drive of our homes, and for the vast majority of us, that won't be closer than 6000 meters to a railroad. I don't know if it means we'll drive less, buy less, use less, waste less....pick one from a long list of things that folks can or will do to make their bucks, including the discretionary ones, go further. 

It seems that hybrid cars have considerable currency suddenly, and everyone who sells cars is on the bandwagon.  There is a market.  But, these cars cost more at the outset, and I don't even want to contemplate what surprises are in store for those who have them when they need replacement energy storage devices.  They won't be cheap.  Also, getting "rid of" the cast-offs won't be cheap...think recycling fees....steep fees.  Heavy metals and all that stuff.

So this doesn't go on for pages, I just can't see us doing much changing unless something catastrophic happens.  It is tantamount to a wholesale cultural change for N. Americans to give up on personal vehicles, and we'll default to the next best vehicle if a gas version isn't it.  But a vehicle it will be.

So, I don't see the trucking industry drying up as that headline suggests.  We'll still need all them autoparts, cabbages, TV sets, camping stoves, loaves of bread, shampoo, and so on that truckers everywhere will continue to haul in the wee hours of the morning.

-Crandell

P.S. - an afterthought....shampoo...isn't it largely a petroleum-based product? 

23 17 46 11

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Posted by Anonymous on Wednesday, March 5, 2008 4:57 PM

Some of the best markets Ive been in are Seafood, Alcohol, Medical Drugs etc.

Other good hauling such as Dedicated Steel/Aluminum coil to feed a plant, Jet Engines, Railroad Axles etc come to mind.

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Posted by MP173 on Wednesday, March 5, 2008 4:53 PM

ulrich:

If you dont mind my asking, what is your market?  Long haul, short haul, dry van, refer, etc.

I think the niche carriers can do pretty well these day, but there is no doubt there is downward pressure on rates for dry van freight. 

It is hard for me to comment on airlines and their profitabilty, productivity, etc, but pulling out LUV's as representative of the industry is a bit of a stretch.  They are a very well run carrier with decent union contracts and low legacy costs.  They operate one type of jet (737 series) which is productive for them.  I have always liked flying Southwest, as you could count on them operating on time, or close to it.  For my 6'7" frame, it isnt comfortable, but anything other than 1st class isnt.  Generally, I limit my flights to 4 hours or less.

It has been stated that the airline industry has a net income historically of zero or less.  It is difficult to find much excitement in the industry as an investment.  Labor costs seem to have stabilized, now they are searching for merger partners to create pricing power. 

ed

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Posted by Expresslane on Wednesday, March 5, 2008 4:46 PM

 

  I have been truckin for only twenty years.Have been an o/o for only ten years. I'm still learning. I have heard the same story every year. The same rates as the 70's but cost of everything else keeps going up. Have seen wages go up for drivers too.  The thing is though we are all still trucking. How high will costs have to go to put some of us out?  As for me I know my costs and what I need to make a profit. I don't haul it unless it pays me the rate I need.

  There is better talk about trucks on this forum than the trucker forum. One more thing. The railroads need trucks and truckers as much as everyone else does.All those intermodel trailers still need a trucker. How many times have you seen railroad parts like wheels on the highway and not on a railroad flatcar?  Stay safe.

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Posted by MichaelSol on Wednesday, March 5, 2008 4:24 PM
 Ulrich wrote:

All input costs have gone up...some have even doubled...fuel...labor..equipment.. Anyone with any business sense and no relatives who will work for free will keep their pricing in line with cost.

Or improve productivity. Airlines in general have improved their productivity 35% since 1997.

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Posted by MichaelSol on Wednesday, March 5, 2008 4:17 PM
 Ulrich wrote:

Airline margins are laughable...why would anyone get into the discount airline racket?

I don't follow airlines, but Southwest is a discount airline, isn't it?

Profit Margin (ttm):6.54%
Operating Margin (ttm):11.34%
 
Management Effectiveness
Return on Assets (ttm):4.62%
Return on Equity (ttm):9.63%

That's not bad by any stretch.

 

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Posted by selector on Wednesday, March 5, 2008 4:07 PM

I have enjoyed the commentary, everyone.  Thanks for your thoughts.  I can't seem to find it on yahoo's home-page just now, but earlier today their headline section had one about citizens in the USA changing lifestyles due to rising energy costs.  I was on my way to somewhere else and didn't get to have a quick glance before it disappeared in due course.

Everyone seems to have accepted that energy costs will rise, sometimes sharply, if the headline has weight.  But, as some of you have suggested, we'll still want stuff delivered somewhere within a Saturday morning's shopping spree drive of our homes, and for the vast majority of us, that won't be closer than 6000 meters to a railroad. I don't know if it means we'll drive less, buy less, use less, waste less....pick one from a long list of things that folks can or will do to make their bucks, including the discretionary ones, go further. 

It seems that hybrid cars have considerable currency suddenly, and everyone who sells cars is on the bandwagon.  There is a market.  But, these cars cost more at the outset, and I don't even want to contemplate what surprises are in store for those who have them when they need replacement energy storage devices.  They won't be cheap.  Also, getting "rid of" the cast-offs won't be cheap...think recycling fees....steep fees.  Heavy metals and all that stuff.

So this doesn't go on for pages, I just can't see us doing much changing unless something catastrophic happens.  It is tantamount to a wholesale cultural change for N. Americans to give up on personal vehicles, and we'll default to the next best vehicle if a gas version isn't it.  But a vehicle it will be.

So, I don't see the trucking industry drying up as that headline suggests.  We'll still need all them autoparts, cabbages, TV sets, camping stoves, loaves of bread, shampoo, and so on that truckers everywhere will continue to haul in the wee hours of the morning.

-Crandell

P.S. - an afterthought....shampoo...isn't it largely a petroleum-based product? 

  • Member since
    February 2003
  • From: Guelph, Ontario
  • 4,819 posts
Posted by Ulrich on Wednesday, March 5, 2008 3:53 PM

I don't know what the rates were back in 1980, but my rates have gone the same way as the post office: UP. All input costs have gone up...some have even doubled...fuel...labor..equipment.. Anyone with any business sense and no relatives who will work for free will keep their pricing in line with cost.

 Airline margins are laughable...why would anyone get into the discount airline racket? Rail margins appear to be good...and with only four mega systems and regionals who don't compete head to head that should not be surprising.

Deregulation was a good thing..prior to deregulation you needed pull and favors granted by politicians to get into the freight biz...Today anyone who has an interest can get started. It's much fairer, and "survival of the fittest" isn't all bad.

 

 

 

 

  • Member since
    October 2004
  • 3,190 posts
Posted by MichaelSol on Wednesday, March 5, 2008 3:40 PM
 MP173 wrote:

He is hauling freight for the same rates as in 1980. 

Airline passenger rates are lower. Rail freight rates are lower. Package shipping is cheaper.

The trucking industry isn't anything I've followed, but I seem to recall that the truckers were among the most vocal agitating for deregulation, thinking they had it all over the railroads competitively.

Perhaps a case in point of "be careful what you ask for, you might get it."

 

  • Member since
    March 2004
  • From: Indianapolis, Indiana
  • 2,434 posts
Posted by gabe on Wednesday, March 5, 2008 3:32 PM
 MP173 wrote:

Misc comments:

Actual phone conversation with a trucking CEO this morning:

ceo: ed, how are you?

ed: great

ceo:  do you know the reason you feel great?

ed:  A good night's sleep?

ceo: no, it is because you left the trucking industry in 1990.

He then basically went on with the same conversation as what has occured on this post.  He is hauling freight for the same rates as in 1980.  Costs are thru the roof.  Fuel surcharges help, if you can get them, driver turnover is out of control and now with the economic slowdown Mr. Shipper is beating them up over rates. 

Years ago, he started an LTL company in addition to the TL operation.  At the time I asked "Michael, why in the world do you want to expand your trucking operation."  He never lets me forget that I asked him that question.  He thinks I am a brilliant man for that one comment made in 1992. 

Point number 2...wind farms are springing up.  Yesterday I saw one with about 50 windmills south of I80 between Peru and Princeton.  How economical are these? 

Point number 3...minor correction (actually major correction) XOM (Exxon Mobile) revenue last year was $404 billion with net income at 40.6 billion.  The previous poster indicated their profit was $360 billion. 

Point number 4...if you have a chance, read the editorial in March 4th Wall STreet Journal about Peak Oil.  The author (name escapes me) indicates we have 50-60 years to go before reaching Peak oil level (when half of the oil has been depleted).  We in the US have long ago reached Peak oil (1970).  Technology and the high oil prices will result in higher production.  It is a very interesting article and commentary.  What is frightening is that his estimate is that 90% of oil reserves are state controlled.  So, we must get used to Mr. Chavez and others.

Point number 5...anyone here seen the movie The Kingdom?  Excellent movie on the cultural differences between US and Muslim nations.  I dont know how accurate the movie is, but the DVD has an excellent timeline of Middle East oil production/politics.

ed

Nice to read your comments on here again, Ed.

I guess I am the only one crazy or masochistic enough to think this way, but I like these high energy prices that can only go up.  I really, really do.

For the last 30 years, cleaner and more efficient alternates to oil have been blown all to-you know where-due to, in part artificially, low energy prices.  Now, I think the market is to the point where OPEC and oil/gas cartels really can't lower the price to discourage the development of alternate sources.  Now the market can do what it does and encourage the development of alternate sources of sustainable energy.

It is going to be a rough 8-10 years, but I think the world will ultimately be a much better place because of the higher prices we are currently seeing (assuming we all don't kill one another first).  No one will buy Mr. Chavez' oil, the Middle East can stop accusing us of stealing their oil on the cheap, and there will be less pollution.

Gabe

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