High diesel prices squeeze truckers

Independent drivers have been hit especially hard, and some will be forced out of business.

from the April 11, 2008 edition

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The Owner-Operator Independent Drivers Association says it doesn't think strikes are the way to go. Instead, it is pushing for legislation that would require shippers to pay truckers a fuel surcharge and that would make the transactions between brokers, shippers, and independent truckers more transparent.

Currently, many drivers get some surcharge to cover rising fuel prices, but rarely all of it. Some shippers balk at paying one at all.

"The independent trucker doesn't have anybody on their side to help them recover costs," says Larry Daniel, president of America's Independent Truckers' Association, which is also advocating a mandated fuel surcharge. "As much as I hate government intervention under normal conditions, these are not normal conditions."

Many drivers, for instance, are desperate enough that they'll accept a price that doesn't even cover their costs, in hopes of getting somewhere where they can get a better load.

Still, most experts say such a mandate is both unlikely and tricky to impose in a contract situation.

"The free market will deal with it," says Aaron Gellman, founder of Northwestern University's Transportation Center in Evanston, Ill. "If the market will stand a fuel surcharge, so be it."

Eventually, say Mr. Gellman and other experts, the cost is likely to be passed on to shippers and to consumers. But in the meantime, truckers will bear the burden, and some independent drivers will be forced out of business.

For now, many truckers say they simply use all the techniques at their disposal to stay in business.

"It's a learning experience every day," says Tom Harris, a trucker from Davidsville, Pa., speaking by cellphone from Huntington, W.Va., where he's delivering a load of scaffolding. As soon as he receives an offer, Mr. Harris gets on the phone with his wife, who looks on the computer to figure out fluctuating costs, the route, and what tangential expenses might be involved.

"My way of fighting back is just not hauling the cheap freight," he says. "I won't put a load on my truck anymore that I'm going to lose money on."

But negotiating the prices, when there always seem to be drivers willing to do it for less, can be tough.

"The load I'm on now, I tried to get more, but they say they can't afford to pay it," says Bob Benson, a trucker from Bemidji, Minn., who owns three trucks and has been in the business since 1974. He doesn't remember it being this bad in the 1970s, when fuel prices also skyrocketed.

Right now, he's struggling just to hang on to his other trucks and the two men he employs to drive them. "It's just about impossible," he says. "I'll keep on as long as I can."

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