Month: January 2013

Fuel prices will decline by 10 cents per gallon, for at least part of the year, but they will remain high relative to carrier revenue. As the fuel price — and surcharge — declines, the line haul portion of the rates will increase to compensate, so the total rate paid to the truck should remain stable to 2% higher over the course of the year. (For more details, see my discussion with Peggy Dorf about the economy in 2013.)

Seasonal rates will rise for all trailer types in Q2 on the spot market, to an atypically high peak, but the increases will not be sustained throughout the year. A Q2 spike is normal on the spot market, but this year it should be exaggerated because of demand-related issues: (1) Flatbeds will be in high demand to haul construction materials and equipment to the East Coast for post-Sandy re-building, and to support increased oil drilling in the Upper Midwest and South Central states; (2) There (hopefully) won’t be a repeat of last year’s spring freeze and prolonged summer drought, which depressed reefer freight volume and rates during produce season; and (3) Pressure on capacity for other equipment types will affect vans as well, because carriers with multiple trailer types will accept the high-payng.freight first and leave the van trailers in the yard. Van-only fleets should find themselves in a strong negotiating position, especially for time-sensitive freight.

Capacity should be adequate, with short-term, localized shortages. Class 8 truck sales were robust in 2012, but the net increase in drivers is not keeping pace. As soon as the economy revs up, transportation industry publications and analysts will start fretting about the looming capacity shortage, problems with driver retention, rising freight rates and all the other “risks” of economic growth. I predict that economic growth will be tepid in 2013, at best, so capacity issues will be mostly confined to local and seasonal shortages.

Truck freight tonnage will increase by 2.0%, and spot market freight availability will grow 5.0%. Last year we saw a 3.4% increase in tonnage compared to 2011, according to the ATA For-Hire Truck Tonnage Index (not seasonally adjusted.) That was good, but not as robust as the 5.7% growth of 2011 vs. 2010. Looking ahead to 2013, we may see a flat or negative freight tonnage index in Q1, followed by a strong Q2 and a rebound in the rest of the year. I’m expecting a 2.0% to 2.5% uplift for overall tonnage in 2013. Spot market demand — meaning demand for trucks — rose by 3.1%.in 2012, with 7.5% growth in van and reefer freight availability balanced by a 2.0% drop in loads designated for flatbeds. In 2013, freight availability should rise for all three major trailer types (see discussion of seasonal rates, above.) Net prediction: the spot market in 2013 will look more like 2011, with 5% growth.

Consolidation among freight brokers and 3PLs will affect individuals and companies, but there won’t be a big impact on the overall market in 2013. The $75,000 bond requirement kicks in at mid-year, but enforcement is likely to lag. Some small brokers will not have sufficient financial resources to secure a bond at that new level. The effect of the bond won’t be felt immediately, but we expect to see a trend toward consolidation among intermediaries. Large brokers and 3PLs will buy smaller ones, and some independent brokers will become agents or retire from the business. Trucking companies may forge tighter relationships with brokers, rather than establish a brokerage entitiy with its own authority and bond, that is separate from the trucking company, as required by law.

In 2009, semi trucks were involved in more than 3,000 fatal crashes. Approximately three-quarters of those crashes involved another moving motor vehicle. Despite U.S. Department of Transportation regulations limiting daily and weekly drive-times for long-distance truck drivers and requiring logs documenting daily hours and mileage, many truck drivers are paid by the mile and work close to the maximum conditions permitted. The long days and hard demands of driving and delivering products can interfere with a truck driver’s ability to safely operate the vehicle. Reporting semi truck safety issues can help decrease the number of fatal accidents involving commercial drivers

●Keep a pencil and notepad in a readily available area of your car. Many trucks are labeled with safety reporting bumper stickers that display a toll-free number to call and a vehicle identifier to provide. Having ready access to writing materials allows you to record that information and call when you are in a safe location to do so.

●Write down any identifying information from a truck that is being operated unsafely. Record the fleet-specific phone number and vehicle identifier, if available, the license plate state and number, and any distinguishing marks or logos. Take note of the location, mile marker and time that the incident occurred.

●Pull over at the closest safe location. Call the state patrol office to have an officer check on the driver. Contact the delivery fleet and inform the company of the behavior as well. The state patrol can determine whether the driver has broken any laws and possibly prevent an unsafe driver from causing a collision. Delivery fleets require private motorists to help identify and correct unsafe operators.

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A trucker agent, also referred to as a trucking broker or freight broker, acts as a go-between for companies that need products shipped over the road and independent truck drivers or small trucking companies that can fulfill that need. The trucker agent negotiates a rate that is acceptable to both parties and hammers out other details. In exchange, the agent or broker receives a portion of the established rate, usually taking a cut from what the trucker or trucking company receives.
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&#9658 Gain extensive knowledge of the trucking industry. If you have experience working as a truck driver or dispatcher (driver manager), you will have a leg up. You will need to know Federal Motor Carrier Association rules and regulations, such as the number of hours a driver can run in a day or week, in order to schedule loads.

&#9658 Fill out a Federal Motor Carrier Association application for freight forwarder authority (form OP-1) online or by mail and pay the required fee ($300 per application, as of May 2009). Wait for acceptance, which may take several weeks or a few months.

&#9658 Assign a “Process Agent” who will serve as the representative responsible for being served court papers in the event that legal proceedings are ever brought against you. You are legally required to designate process agents in every state where you have offices or contracts. There are businesses offering nationwide process agent services.

&#9658 Purchase a $10,000 “Broker Surety Bond,” which will pay the parties with whom you work if the contract is not carried out.

&#9658 Find shippers and carriers who want to do business with you by visiting Internet freight boards, reading industry publications and networking.

Kenworth Truck Company builds premium commercial trucks for sale in the U.S., Canada, Mexico, Australia and for export throughout the world. One of the most talked about models for 2011 is the T700. It features the lowest aerodynamic drag of any truck in Kenworth’s history.

Drivetrain
At the core of the 2011 T700 is the highly-efficient, clean-running 12.9-liter 2010 PACCAR MX engine producing 380 to 485 horsepower and up to 1,750 foot-pounds of torque. The PACCAR MX is designed for maximum fuel economy and features lightweight high-strength components.

According to the manufacturer, The PACCAR MX has near-zero emissions due to a combination of exhaust gas recirculation and Selective Catalytic Reduction, effectively meeting the EPA 2010 emission regulations.

A diesel-exhaust fluid tank and the combo diesel particulate filter and SCR chamber are folded into the passenger step. Exhaust is single horizontal. Transmission is Eaton’s automated mechanical two-pedal clutch with a 10-speed UltraShift Plus. The 2011 T700 is driven by Eaton axles — 3.70-to-one Dana Spicer DSP41 on a 40,000-pound Ag400L suspension — borrowed from the Peterbilt line. The truck has a Kenworth air-ride AG130 and Bendix disc-braked Dana Spicer E-13221 steer axle rated for 13,200 pounds — the industry standard.

Styling and Features
The 2011 T700’s hood, fenders, headlamps, windshield, roof, bumper and fairings are integrated into the design, providing the lowest aerodynamic drag of any Kenworth truck, according to the manufacturer. The truck’s bumper and chassis fairings are fashioned from thermal plastic olefin for improved impact resistance. Bumpers and fairings do not need to be painted and are available in painted or non-painted versions. The hood is comprised of three pieces, along with a two-piece aero bumper, all designed to reduce the time and cost of repair. The hood features a ball-and-socket closing system

The grill is made of corrosion-resistant aluminum wire mesh and provides protection for the cooling system components.
Three lengths of chassis fairings are available to meet individual requirements: wheel to wheel, three-quarter to accommodate APU installation or under the cab. The 2011 T700 features halogen projector headlamps. Turn signals are LED, as are the flush-mounted marker lights in the roofline for optimum visibility.

Cab and Sleeper Features and Comfort
The inside of the cab has an 8-foot cathedral ceiling with 30 inches of space between the seats. Features include 60-cubic-feet of storage, a slide-out desk, full-length hanging closet, xenon incandescent lighting, an optional drawer-style refrigerator and TV mount for a 16-inch flat-panel.

The cab features multiplexed instrumentation NavPlus navigation system is optional. Standard cab appointments include vinyl seating, pleated upholstered headliner, upholstered door pads with carpeted kick panels, door courtesy lights, black rubber floor mat, driver and passenger sun-visors, heater, defroster and air-conditioning.

The sleeper shares many of the same flooring and upholstered surfaces as the cab with wall-to-wall carpet, wood-grain accents, a 42-inch by 80-inch lift-able lower bunk, magazine rack on the rear wall above the lower bunk and a standard storage package.

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The trucking industry is imperative to the United States shipping supply chain. Projections estimate that by 2014, 14 billion tons of freight will be transported annually by truckers in the United States. As fuel and operational expenses rise, it is important for trucking business owners to plan their daily operations to allow the business to profit and remain viable over the long term. With the assistance of technology and planning, trucking businesses can maximize their profits and continue to move America.

Calculate the break-even cost for each load that you haul by figuring out the cost of fuel, labor and a portion of your business’s fixed expenses. To establish your fixed expenses, include costs like monthly truck payments, insurance, licenses, taxes and office expenses. Divide this amount by the number of loads you plan to haul each month to determine the amount of fixed expenses to charge with each load.

Provide customers and brokers with a realistic price estimate for each load. Ask as many questions about the load as possible when discussing potential contracts with a customer and use this information to give an estimate that covers your break-even costs as well as your desired percentage of profit. Plan loads so you can profit hauling to and from your destination. Consider the costs associated with returning to your business base with an empty truck if you are not able to arrange a return load, and include these costs in your price.

Maintain regulatory compliance by working with your employees to ensure that log books are properly filled out, trucks are not overloaded and drivers are not working longer than allowed by law. Tracking compliance will not only help keep drivers safe reducing the potential cost of accidents but it will also help your business avoid fines from regulatory agencies.

Use fleet management software. Keep track of your fleet maintenance and work in one location for easy reference, along with reminders to stay on top of regular oil changes, tire rotations and more. By regularly maintaining your fleet, the long-term cost of major repairs will be reduced.