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Carrier cutting rates

xmudman

xmudman

Veteran Expediter
Owner/Operator
B114, just imagine yourself in a 9-to-5 job. Your boss tells you that your pay is going to be cut by 12.5%, but that you will be able to make it up with overtime. So you go from $16/hr to $14. Instead of grossing $640 for 40 hours of work, now you have to work 43.8 hours* to make the same $640. That's time out of your life, that could be spent playing pool with your buddies, ball with your kids, "grownup games" with your significant other, whatever.

*$14.00/hr x 40 = $560.00, $14 x 1.5 x 3.8 hrs = $79.80. Added together, $639.80, which is pretty close to $640.00.

Sure, more miles is preferable to fewer. But more miles at less pay per mile is rarely, if ever to your advantage. See my post above, re: truck getting paid before you do.
 
Steady Eddie

Steady Eddie

Veteran Expediter
Owner/Operator
Tennesseahawk said:
Then tell us, dammit. :D
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Well, I made money with the 1.00 + FSC. I made money with the .70, after loading, the freight that was .70 turned out to be 1.00 due to height, number of skids, and weight. I ran more and made more. Express-1 has really been a good fit for me. They were also good to me in time of need. I returned their goodness in kind. I was their biggest surporter, cheer leader. Had some very good rates, sometimes over 2.00 a mile, including tolls, rate and D/H pay, layover etc. I would tell anyone to sign on with them. Now? I will just tell'em the rates and let them make up their own minds.

Up til now they have been good to drive for. They still have, at this time, good folks in dispatch.
 
paullud

paullud

Veteran Expediter
So that guy is a Kobe Bryant and E-1 fan interesting, he likes it when people get away with rape.
 
OntarioVanMan

OntarioVanMan

Retired Expediter
Owner/Operator
he can whine about it or live with it...HIS choice...and he has done just that. Maybe his brother is a truck mechanic who knows and he can reduce his costs with something we know not of...his business...
 
scottm4211

scottm4211

Veteran Expediter
Owner/Operator
OntarioVanMan said:
he can whine about it or live with it...HIS choice...and he has done just that. Maybe his brother is a truck mechanic who knows and he can reduce his costs with something we know not of...his business...
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It's our business when he makes a ludicrous statement that running more miles for less money is a good business plan.
 
Turtle

Turtle

Administrator
Staff member
Retired Expediter
Moot said:
Exactly! Why is it so common among truck drivers to want more miles, faster speed limits and more hours, instead of a higher rate of pay? You never hear of hourly workers demanding a 60 hour week.
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Actually you do. As someone who hired and managed hourly workers for a long time, one of the most common things I heard was, "I need more hours." And it didn't matter whether they were working 20 hours a week or 40, more hours meant more money.

As for running more miles for less money, it is true that you have a cost per mile to move the truck, but the CPM isn't a static figure. Your CPM will be higher for 40,000 loaded miles per year than it will for 80,000 loaded miles. Fuel and other operating expenses are relatively linear (although it's more fuel efficient to run a single 500 mile load than it is to rune five 100 miles loads), but all fixed expenses (insurance, for example) get cheaper per mile the more miles you drive.

If you're in a van and you make an average of $1.10 a mile, and run 800 miles per week, those are profitable miles. But you can't live very long on $880 gross per week.

On the other hand, if you get $.90 per mile and run 2000 miles a week, those miles aren't necessarily as profitable as the 800 miles, but you can do a lot more with $1800 gross per week than you can with $880. You're still going to net about a third, either way. But they key is getting more miles for less per mile. If you're running the same miles but for less per mile, then you're CPM goes up and you clear even less than the rate reduction alone would indicate. So if they say the reducred rate means more miles, then you'd better hold them to it.
 
OntarioVanMan

OntarioVanMan

Retired Expediter
Owner/Operator
scottm4211 said:
It's our business when he makes a ludicrous statement that running more miles for less money is a good business plan.
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I didn't say it was a good business plan..it is his plan.....

We don't know his circumstances...we are ASSUMING his is like most here...he MIGHT have his own repair shop?.... he might have a dealer license where he gets his parts a heck of a lot cheaper.... he makes a wild statement and WE attach OUR values to it....
all he has to do is reduce his over all costs by about .12 per mile....heck he can do that thru fuel...

added: see Turtles post above....
 
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scottm4211

scottm4211

Veteran Expediter
Owner/Operator
OntarioVanMan said:
I didn't say it was a good business plan..it is his plan.....

We don't know his circumstances...we are ASSUMING his is like most here...he MIGHT have his own repair shop?.... he might have a dealer license where he gets his parts a heck of a lot cheaper.... he makes a wild statement and WE attach OUR values to it....
all he has to do is reduce his over all costs by about .12 per mile....heck he can do that thru fuel...
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Then why did he wait forE1 to reduce rates if it's such a great idea? Why not run cheap from the start?
 
zorry

zorry

Veteran Expediter
Is John bleeding dollars,i.e. subsidizing the van fleet,OR is he just being truthful with his numbers and all is well.
Let's hope it's the later.
 
paullud

paullud

Veteran Expediter
OntarioVanMan said:
I wonder what the reaction will be when and IF our rate cuts come?...John can not keep bleeding dollars like this for ever...it is only common sense.
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So you are saying Load 1 is losing a lot of money? If there is a break even on the vans or even a slight loss is it just an advertising program that brings in more money from ST or TT?
 
xiggi

xiggi

Veteran Expediter
Owner/Operator
paullud said:
So you are saying Load 1 is losing a lot of money? If there is a break even on the vans or even a slight loss is it just an advertising program that brings in more money from ST or TT?
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Pay no attention to the man behind the curtain.

Sent from my Fisher Price - ABC 123
 
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