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Companies both big and small struggling in tough economic climate

ALEXANDRIA, Va. — At this point, the size of the trucking company doesn’t matter. All are finding the current industry climate pretty tough, says the president of the Truckload Carriers Association.

“I’ve heard from some carriers that they’ve seen a slight uptick over the last month or so, but I think overall, it’s still pretty challenging,” Chris Burruss told The Trucker. “I think the biggest problem right now is a lot of concern that if and when volumes pick up, the question of profitability still remains a pretty pressing one.”

To no one’s surprise, Burruss said, the biggest culprit behind the current tough times is fuel.

“It’s not just the cost of it, but the unpredictability of [fuel prices] also creates some big problems.”

And, Burruss noted, trucking companies by no mean are able to recoup the additional fuel costs through surcharges.

“There may be some carriers having more success than others,” he said. “Certainly, I don’t think anyone is recouping all of their fuel costs because to recoup them all, you have to take in deadhead miles and all that typically is not going to be covered under anybody’s fuel surcharge program.”

He said TCA kept no data on the percentage of deadhead miles members run.

“I think it [recouping costs through a surcharge] is still a big problem. Again, it’s a supply-and-demand issue. With excess freight, if in fact there still is, or excess capacity, I think carriers are much more challenged in their ability to negotiate or renegotiate fuel surcharges. If demand or capacity is tight, then I think carriers are in a better position to do so, but I don’t we’ve gotten there yet.”

All trucking companies are facing a dilemma now, Burruss said.

“With the lag in time it takes for a carrier to get paid, I think there are a lot of cash flow problems out there now,” he said. “They are having to carry more of the burden of fuel on the front end and it takes a longer period of time in a lot of cases to get those costs back or to get paid for hauling the freight and yes, I think that’s causing a lot of problems for a lot of people.” 

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