While the big rigs on our highways get bigger, it seems as though the profit left in the pockets of truckers, is declining. Along with the increased tractor trailer dimensions and equipment improvement demands of the trucking industry over the years, thus in turn, the operating cost per mile has also increased.
The trucking industry continues to bow to the shipper’s demands.
When I initially became involved with the industry, one of the first trucks we owned, was a conventional long-hood tractor…. a 42′ trailer, 96″ in width.
It was the maximum tractor trailer dimensions allowed at the time….. state-of-the-art equipment, if you will.
We’ve watched tractor trailer dimensions increase from a 42′ trailer, to 45′, to 48′, with a width increase to 102″, to a 53′ trailer with a height increase to 110″ (hi-cube), and the legal limit of tractor trailer dimensions, continues to increase.
Since this time, the industry keeps struggling to meet the demands of the shippers and the incessant demands of the industry…. all with the end goal of increased profits.
However, it’s turned out to be nothing more than a pipe dream.
Bigger Trucks, Less Profit
However, logic dictates that when hauling more freight, the profit would in turn, increase. But, the overall rates never ‘truly increased’, but the trucking cost per mile continues to climb.
In fact, the freight rates have decreased over the years. Yet, we in the industry have been forced to spend large amounts of money, to update our equipment in order to meet the demands of the shippers.
How Equipment Costs Rise
This factor has contributed to the rising costs of doing business. Initially, parts of Canada and California, (later all of the U.S. and Canada), implemented laws for stringent emissions, eventually causing CAT engines, the biggest player in the industry, to bow out of the competition, rather than attempt to build an engine, whose design, thanks to government intervention, was not mechanically sound.
This indirectly affects the trucker population, as they now have fewer choices of engines for their tractors, tightening up the engine manufacturers competition, which in turn, means more expensive engines for trucks.
Truck Tires: Commercial Truck Tire Changes
Tire manufacturers are now being forced to produce low resistance rolling tires. What does this mean in layman’s terms to the industry? It means a tire with shallow tread depth that will be virtually useless on snow-covered highways. This issue means greater tire costs, as these tires with shallow tread depth, wear out much more quickly.
There’s more lost time in delivery schedules when big rigs spin out and have to chain up or be towed. The super singles are being pushed into the industry as a fuel saver. But, if a truck blows a super single on the highway, there’s the price of a new tire, new rim (due to no other tire to support the axle), and the cost of a service call to deliver and install a $1200 (minimum cost) tire and rim to the stranded truck.
Truckers are now installing fairing kits on tractor trailers, in order to help diesel fuel economy. These accessories are light weight and tend to vibrate and flex as the truck travels at highway speeds. They eventually break both the faring and the mounting brackets, and add to the maintenance costs for the trucker, when they require repair. Save fuel? Maybe. But equipment repair costs may out weigh any fuel savings.
Fuel Efficient Trucks
Truckers can now purchase more fuel-efficient tractors. Our profits continue to decrease with the never ending rise in fuel costs, so we combat this, by purchasing new big rigs that are supposedly more fuel efficient.
But, with these new fuel efficient rigs comes the maintenance costs of keeping them running to their potential. Also, along with the introduction of this fuel-efficient technology, comes the cost of DEF fluid to keep them running, as well as greater labour costs in a repair shop.
Is Change Always the Best Solution?
We’ve managed to take the tractor trailer unit from being a pretty simple piece of equipment that could operate efficiently and be repaired by the trucker…. a unit that could maneouver through busy city streets easily, and have managed to turn them into large, cumbersome units that are expensive to operate and repair, all to meet the demands of the shipper.
Meeting the needs of the shipper by increasing tractor trailer dimensions, may have been a huge mistake made by this industry. With these changes in dimensions, a huge loss of profitability for the truck driver has resulted.
Recently, statistics have revealed, that the trucking industry has gone from 80% of big rigs on the road being operated by independents and small trucking companies, to less than 10% of the big trucks on the road today….. a staggering statistic.
These shocking figures suggest that only the large truck fleets are able to operate at a profit today. The increasing trucking costs, along with demands for bigger trailers and equipment improvements, have been devastating to the independents, owner operators and small trucking companies. Larger fleets still manage to survive in spite of the costs, due to their volume.
The bottom line? Over the years, we’re hauling a greater volume of freight for less money.
Future of Independents, Owner Operators and Small Carriers
Where does this trend end? Will there only be 2-3 Super Carriers that will move all freight in North America? The present trend certainly points to this conclusion.
In the end, manufacturing may prove to be it’s own worst enemy, when through attrition, it has eliminated, all but a few huge carriers.
Only time will tell if these few huge carriers will have the ability to provide the service their customers desire, as efficiently as the small carriers and independents were able to.
I seriously doubt if they can do it.