![[Valid Atom 1.0]](valid-atom.png "Validate my Atom 1.0 feed")
Commercial Transportation COSTS * USA - Why Your Groceries Are Costing More
... The cost of commercial transportation...
USA -Burkhart's Blog, by Alan Burkhart -March 07, 2008: -- ... Having been in the trucking industry for three decades, this is something I'm qualified to talk about... A few years ago trucking companies large and small could make money hauling freight for about $1.20 per mile. This includes food items, paper goods, structural steel, agricultural products and pretty much whatever else you can think of. Fuel of course was a good bit cheaper during this period, averaging around two dollars per gallon. Modern commercial trucks generally get about six miles per gallon, which is a vast improvement over the 3.5 mpg back in the 70's when I started driving a truck. Six miles per gallon is an average, with some getting more and others getting less. The cost per mile for fuel at 6 mpg / $2 a gallon was thirty-three cents per mile... As of this writing, the national retail average price for a gallon of commercial diesel is $3.77. This average (AK and HI are not included) for 48 states translates to an average cost of sixty-three cents per mile - almost twice the cost as a few years ago... Add to this amount the driver's salary - a minimum of about 35 cents per mile with most companies paying in the 40 - 45 cents per mile range and the cost per mile goes over a dollar. To that, add in the necessary per-mile computation for permits, insurance and truck / trailer registration. Registration for a commercial truck-tractor, by the way, costs $1000 to $1800 depending on where it's registered and a handful of other considerations... But we're not done yet. Now consider that freight revenue also has to pay the wages of mechanics, dispatchers and administrative personnel. Then allow for keeping the lights on and the water flowing, property taxes, facility maintenance and whatever other requirements an individual company may have... And did I mention tires? Depending on the type of tire (trailer, drive tire or steer tire), and the part of the country you're in when you buy them, truck tires cost anywhere from $280 to nearly $400 each. That translates to about $5000 to put new tires on an 18-wheeler, and truckers average about 120,000 miles per year. Tires don't last long... I work for a small company with 30 trucks. We don't leave the office these days for less than $1.75 per mile. If we work for less, we lose money. It's just that simple. In the practical sense, we need about $2 per mile to make it worthwhile. Look at it another way: At $1.20 per mile, the ton rate for a 44,000 pound load of freight is about five cents per mile. At $1.75 per mile, the ton rate increases to eight cents per mile...
Labels: trucking costs
posted by Unknown @ 8:17 AM
1 Comments:
Well said. I have been in the trucking industry for over thirty years myself. One thing I don't understand is why the trucking industry is letting the shippers dictate the freight rates. You don't go into a grocery store and negotiate with the butcher over the price of steak. You pay the price or you go somewhere else. If more truckers would refuse to haul the cheap freight, prices could be adjusted back up to an acceptable level.
Post a Comment
<< Home