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May 7, 2008

FUEL COST TROUBLES * USA & Canada - Trucking companies passing on fuel costs as prices climb

New York,NY,USA -The NY Daily News,by STEPHANIE GASKELL -May 6, 2008: -- Truck drivers reeling from the skyrocketing price of fuel are pushing those extra costs down to their customers... Delivery trucks are increasing the amount of fuel surcharges on their invoices... In some cases, they're adding the charge for the first time... He said an April invoice for a food delivery showed a $2.28 fuel surcharge. The next month it was $2.49... He also said fuel surcharges for deliveries of cash from armored car companies - which are heavy and use a lot of gas - have jumped about 25%... Gaige Clark, owner of Spruce florists in Chelsea, said she's seen her fuel surcharges increase by as much as 10%. Grappling with that and the rising cost of imported flowers, she was forced to raise her prices... Tom Hanna, who was delivering fabric yesterday in the Garment District for New Jersey-based Wrag-time Trucking, said there's not much that business owners can do... Gene Walton, who owns Walton Hauling and Warehouse Corp. in Manhattan, said he was recently forced to ask one of his biggest customers for a fuel surcharge after seeing the price of diesel double in the past year... (Xanthos for News - Trucker Tom Hannah, 44, of Lodi, N.J., says soaring cost of diesel has hurt his business)


* Canada - A rough ride: Cost of diesel hurting carriers

Halifax,NS,Canada -The Chronicle Herald, by TOM PETERS -May 6, 2008: -- The high cost of diesel has put Atlantic Canada’s trucking industry between a rock and a hard place. Industry executive Shane Esson more aptly describes it as being in survival mode.
Skyrocketing diesel prices have put several Atlantic companies in a precarious financial position and any short-term relief is not on the horizon... Diesel prices have increased as much as 50 per cent in the past year and trucking companies are paying in excess of $20,000 a year more per truck for fuel over last year... The industry can apply a fuel surcharge to try and compensate for the high diesel price, and although that may seem like a simple solution, it doesn’t necessarily work in the carrier’s favour... The Freight Carriers Association of Canada, through a formula, recommends a surcharge on a weekly basis. Presently it is in the vicinity of 40 per cent of the basic shipping rate. But trucking company customers may refuse to pay that much, so hauling cargo may become a bit of a bidding war based on surcharges... So fuel surcharges can, in effect, become a bargaining chip for customers. Furthermore, these surcharges have, in an indirect way, deterred trucking companies from raising their basic hauling rates... Carriers need a fair return for their services to survive, not only because of the cost of fuel but to pay for new equipment, especially for new engines to meet stringent emission standards, higher labour costs and increasing compliance costs with all the programs required at the Canada-U.S. border... But customers are not anxious to pay an additional three or four per cent on a hauling rate when they are already paying fuel surcharges... In the end, it will likely be the consumer who will pay as transportation costs continue to be a major part of retail prices... (Photo by Christian Laforce - A truck driver fills up with diesel at a Halifax service station)


* Truckers Bemoan Burden of High Diesel Costs - Higher transport costs get passed on to consumers, truckers warn

Washington,DC,USA -Consumer Affairs -May 7, 2008: -- Truckers want Congress to put a cap on diesel prices... Testifying on behalf of the American Trucking Associations before the House Subcommittee on Highways and Transit of the House Transportation and Infrastructure Committee, American Trucking Associations State Vice President Mike Card said the dramatic increase in the price of diesel combined with a downturn in the economy and softening demand for freight transportation has many trucking companies struggling to survive... Because trucking is a highly competitive industry with low profit margins, many trucking companies are reporting that higher fuel prices are greatly suppressing profits. In the 2008 first quarter, 935 trucking companies with at least five trucks failed. This represents the largest number of trucking-related failures since the 2001 third quarter... ATA said it believes that balancing the need for an efficient petroleum market with the desire to limit petroleum speculation could help burst the bubble that has formed in the petroleum markets. The trucking industry also said it is making every effort to limit fuel consumption, including lowering speed limits and utilizing equipment to reduce idling...


* High diesel prices parking small trucking businesses

Barstow,CAL,USA -Desert Dispatch by Abby Sewell -May 6, 2008: -- In the past, truck driver Jimmy Mallow might have taken a break during a long haul to sit down for a meal at a truck stop diner... These days, “As far as at home, (I cut out) going out to do anything extracurricular besides paying the bills,” he said... Mallow has given thought to the prospect that if diesel prices continue to rise, the company will close up shop. If that happens, he said, he’ll just have to look for work elsewhere, either at Fort Irwin or driving for a bigger trucking company... Like many truckers, especially independent owner-operators and those who work for small companies, Mallow is feeling the effects of high diesel fuel prices on his wallet... Tom Lewis, who owns T.L. Trucking in Barstow, said "As far as at home, (I cut out) going out to do anything extracurricular besides paying the bills. We’re going to hang on as long as we can, and when we can’t do it, we’ll fold up” ... Darin Clark, who runs a one-man trucking operation out of Tucson, Ariz., stopped to fuel up in Barstow at Flying J Travel Plaza. He can’t cut back on maintenance and repairs, so the fuel prices are forcing him to cut back in other areas, from truck washes to personal expenses... “I can’t survive with a three-percent profit margin. That doesn’t pay my mortgage.”... Ed Jake, another independent trucker who stopped to fuel up at the Flying J on his way down the coast from Canada, said, “If it keeps going the way it has for the past month and a half, I’m going to park my truck.”... Brian Lattner has already done that. Lattner drives for the RDF Trucking company out of Ohio now, but he used to have his own business, running expedited freight in small trucks. He ran the business for three years but closed shop two years ago when rising fuel prices began eating away at his savings... “That’s what I had to do for my family — I had to do it to make ends meet,” he said... (Photo by Abby Sewell - Trucks fuel up at the Flying J Truck Stop in Barstow. Tom Lewis, owner of T.L. Trucking in Barstow, said that it costs his company about $1,000 each time they fill up a tank)

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