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Some port truckers shut down in Oakland to protest fuel prices, surcharges

Some truckers who haul containers in and out of the Port of Oakland shut down this week to protest the fact that their pay has not gone up enough to counter punishing fuel costs. Diesel has been about $4.57 per gallon in California’s Bay area this week.

Protest organizer Ajit Singh Gill has been traveling back and forth from the Port of Oakland and the Lathrop and Stockton rail yards to meet with truckers who have shut down because they can’t afford to fill up their trucks. Some are left with only $54 a day – after paying for fuel – to cover operating expenses and their wages.

“We really don’t consider this a shutdown. It’s just that these drivers can’t afford to drive anymore,” Gill said. “People should understand that they are not making enough money to pay for their trucks, their insurance and everything else they need.”

Gill told Land Line on Thursday, May 8, that some drivers are hauling loads from Stockton to Gilroy for a flat rate of $210 per round-trip, plus a $24 fuel surcharge. With fuel costs running them around $180 per trip, Gill said they are left with just $54 per round trip. Because of traffic and wait times at weigh scales and at docks, he said these truckers are only able to make one round-trip a day.

Some drivers on the West Coast are paying as much as $1,500 each week for fuel, according to one source Land Line spoke to on Thursday, May 8.

“These guys have no other choice but to park their trucks right now,” said the source, who spoke to Land Line on the condition of anonymity. “As the cost of fuel continues to escalate, these guys with older trucks that are only getting about 4 mpg aren’t getting the fuel surcharge they need to keep them going.”

Gill said companies at the Port of Oakland have not held up their end of an agreement they made with port truckers four years ago. That agreement calls for them to pay the truckers 5 percent of their fuel costs above $2 per gallon, he said. He said that while motor carriers’ customers are paying fuel surcharges, that money isn’t being passed along to the drivers buying the fuel.

“This is not a strike that’s getting out of hand. We gave two weeks’ written notice to the companies and brokers that truckers are working for,” Gill said. “Some of the companies responded, but some didn’t respond to the notice at all.”

Port of Oakland Spokesperson Marilyn Sandifur confirmed that as many as 150 truckers were at the port protesting high fuel prices Monday through Wednesday, but said there were only “sporadic demonstrations by truckers” at the port when she spoke to Land Line on Thursday, May 8.

Gill said that decrease in protesters at the port is because truckers began meeting elsewhere after being ticketed for parking their cars at the port.

“The Oakland Police Department is on the scene because the port area is really not a good place for pedestrian access, as you can imagine,” Sandifur said. “The port is not a safe place for people to protest so the police are out there to ensure the safety of the protestors as well as ensure the safety of everyone that’s moving through the port. And then they’re there to make sure that commerce keeps flowing.”

She said she couldn’t estimate what kind of economic disruption the protests have caused at the Port of Oakland this week.

“There’s really no way for us to estimate at this point,” Sandifur said. “We know there’s been some impact, but we really don’t have an idea if it’s a minimal impact or a larger impact.”

Tensions on the rise
One protester described the scene at the Port of Oakland as being under “martial law.” Sandifur said that wasn’t the case at all.

“There isn’t an area set up for protests; this area is set up for train, truck and cargo movement,” she said. “But their right of free speech has been protected, and the Oakland Police are there to see to it. As long as they obey the rules, no one is going to ask them to leave.”

Sandifur said she did see one of the flyers that read, “Subject: Rate adjustment due to high diesel prices,” which was being handed out by truckers at the port.

“Things are definitely difficult for people whose livelihoods depend on the cost of fuel,” she said. “I think what we are looking at is a nationwide issue not a local issue. The elected officials really need to be examining this.”

Oakland Police Department spokesman Roland Holmgren said there have been a few incidents involving protestors at the Port of Oakland, but that overall things have been relatively quiet there.

“There was one arrest for someone who threw a rock and broke a windshield of a truck, and there have been two reports of vandalism,” he said.

Holmgren said he has heard varying statistics on the number of protestors, with as many as 200 protestors reported at one time at the Port of Oakland earlier in the week.

Gill said some companies have come out to negotiate with truckers. He said he was hopeful the protest would be over in the next day or two.

“We are only asking for companies to give us what they agreed to pay us four years ago,” he said. “If you calculate how much it costs to own and operate a truck, there’s no way we can make it on what they are paying us.”

– By Clarissa Kell-Holland, staff writer
Courtesy of LandLine Magazine

Last-minute Mother�s Day shopping? Just pay her what she�s worth

For those who haven’t had time to shop around for the perfect Mother’s Day gift this year, here’s an idea. How about writing Mom a check for $117,000?

According to the research company Salary.com, that’s how much a stay-at-home mom would be paid each year if she was actually compensated for everything she does. Those responsibilities include taxi service for the kids, housekeeper, cook, psychologist and nurse for family members.

The researchers figure a working mom is worth an extra $68,000 beyond what she brings home from her outside job.

So for those of you who are buying your mothers some flowers for $20, just think how much you’re saving.

Courtesy of LandLine Magazine

CARB schedules workshops about in-use truck retrofit rule

The California Air Resources Board has scheduled several workshops to discuss and accept public input regarding its proposed requirement that an estimated 1.5 million in-use trucks meet 2007 emission standards by the year 2012.

The proposed plan would force at least 1.5 million trucks to be replaced or retrofitted in order to cut diesel particulate matter and oxides of nitrogen.

CARB announced a proposed in-use truck rule in August 2007 that would have forced truck operators to replace engines twice in a nine-year span. The current proposal requires truck fleets to meet 2007 emission standards by the year 2010. CARB was redrafting language of the proposed regulation Thursday and Friday, May 8 and 9, after outcry from trucking industry representatives about the regulation’s potential costs.

CARB plans to consider approval of its in-use diesel retrofit rule in October.

Upcoming workshops are scheduled for:

From 10 a.m. to 2 p.m. on Wednesday, May 21, at the CARB Auditorium at 9530 Telstar Ave. in El Monte, CA.
From 10 a.m. to 2 p.m. Tuesday, May 27, at the California DOT’s Garcia Room, at 4050 Taylor St. in San Diego.
From 6 p.m. to 9 p.m. on Tuesday, May 27, at the El Centro Community Center, at 375 S. First St. in El Centro, CA.
From 5 p.m. to 8 p.m. on Thursday, May 29, at the Riverside County Administrative Center, at 4080 Lemon St. in Riverside, CA.
From noon to 4 p.m. and from 5 p.m. to 8 p.m. on Friday, May 30, at the County of Santa Clara Isaac Newton Senter Auditorium, at 70 West Hedding St. in San Jose, CA.
From noon to 4 p.m. and from 5 p.m. to 8 p.m. on Monday, June 2, at the Shasta County Board of Supervisors Chambers, at 1450 Court St., Suite 263 in Redding, CA.
From noon to 4 p.m. and 5 p.m. to 8 p.m. on Wednesday, June 4, at CARB’s Byron Sher Auditorium, at 1001 I St. in Sacramento.
From noon to 4 p.m. and 5 p.m. to 8 p.m. on Tuesday, June 10, at the Fresno County Plaza Ballroom, at 2220 Tulare St. in Fresno, CA.

The proposed rule has been changed and is likely to continue changing before it is formally proposed in October, said Karen Caesar, a CARB spokeswoman.

Until then, truckers and others are encouraged to give input, she said.

“We’re working hard to listen to the truckers and the folks that would be directly affected by this rule,” Caesar told Land Line.

CARB estimates the proposed in-use truck regulation will cost private businesses between $3.6 and $5.5 billion, although the California Trucking Association reportedly have said that estimate is low.

For more information, visit www.arb.ca.gov/msprog/onrdiesel/onrdiesel.htm.

Courtesy of LandLine Magazine

Check out weekly USDA produce truck rates

The popular phrase “knowledge is power” rings true right now for many owner-operators who are struggling to make ends meet. The USDA publishes a weekly “Fruit and Vegetable Truck Rate Report,” which is available on its Web site and updated every Wednesday, but few produce truckers are actually aware that the report exists.

OOIDA has added a link to its Web site so truckers can quickly access the USDA numbers. Visit ooida.com and click on the USDA report button in the upper right corner to read the weekly government report. OOIDA Regulatory Affairs Specialist Joe Rajkovacz, who worked as a produce hauler before joining the Association staff in 2006, said the USDA information can be a valuable benchmark tool for truckers.

The USDA bases the rates in its reports on open – or spot – market rates “that shippers or receivers pay depending on basis of sale, per load, including truck brokers’ fees for shipment in truck load volume to a single destination.”

The report also states that extra charges for delivery to terminal markets, multiple pickups and multiple drop shipments are not included “unless otherwise stated.” Rates are based on the most usual loads in 49-foot to 53-foot refrigerated trailers from the origin shipping area to 10 destination receiving cities, which include: Atlanta, Baltimore, Boston, Chicago, Dallas, Los Angeles, Miami, New York City, Philadelphia and Seattle.

OOIDA member and produce hauler DuWayne Marshall of Watertown, WI, said he wasn’t aware of the USDA’s truck rate report until a few weeks ago, but now he has set the link to the USDA report as a “favorite” on his computer.

“Right now, everyone is looking for a competitive advantage, and my feeling is that information is always power,” he said. “I talked to my customer who admits he does look at the report from time to time to see what the rates are, and I think this would be very useful for truckers to take a look at, too.”

The USDA’s weekly report also outlines which regions are reporting a shortage, adequate or surplus supply of trucks for certain commodities. Click here to read the USDA report.

Courtesy of LandLine Magazine

OOIDA member fights for tow bill charged before Mother�s Day �07

Julie Harned hopes Mother’s Day 2008 turns out better for her than the 2007 holiday did.

Harned, an OOIDA member and co-owner of the DanTrans LLC trucking company of Sturgis, MI, was stuck with a $5,500 towing bill after a DanTrans driver hauling a load of Mother’s Day flowers hit a bridge in Chicago last May.

Harned said a truck shop and tow service unfairly overbilled them, so she pursued a civil lawsuit. The court ruled in her favor, but a year later, the shop still hasn’t repaid them.

“I’m struggling as it is,” Harned said, adding that the total cost for missed loads and overbilling was $18,000.

According to Harned, Kelly’s Truck Center towed a DanTrans truck and reefer on May 10, 2007, to the mechanic shop after the accident, offering to make repairs to the company reefer. Kelly’s workers locked the DanTrans truck behind a gate and wouldn’t allow the driver back into the cab until the bill was paid more than two weeks later, she said.

A Kelly’s driver hauled the DanTrans reefer loaded with Mother’s Day flowers to a Wal-Mart in the area, damaging the load when stopping abruptly, Harned said.

Managers at Wal-Mart stores rejected the load, negating the load and costing DanTrans another $500 to dispose of the flowers.

“We have a statement from the Wal-Mart manager stating that the flowers were all over and off the racks,” Harned said. “Drivers were in back trying to pick up the flowers.”

The Harneds won a $6,000 judgment against Kelly’s Truck Center in Cook County Circuit Court. It was later reduced to $2,045.

The owner of Kelly’s Truck Center in Melrose Park, IL, wasn’t available Thursday, May 8, and didn’t respond to three phone messages left by Land Line on Friday.

The Better Business Bureau rates Kelly’s Truck Center as “unsatisfactory,” and also stated that the shop had not answered any complaints.

The shop hasn’t responded to Harned’s requests for payments and may owe thousands more with interest, Julie Harned said. Kelly’s has 30 days from late April to decide whether they’ll appeal the judgment.

Courtesy of LandLine Magazine

Truckers Hear Cautious Optimism About Business Climate

Truckload carriers are running the anchor leg of a brutal two year race, according to Donald Broughton, transportation analyst with Avondale Partners.

The Wall Street analyst spoke to about 200 Arkansas trucking executives attending the Arkansas Trucking Association conference Thursday in Rogers.

Broughton predicts the worst is about over in terms of weak freight demand that has helped to drag down profits among carriers of all sizes and classifications for six fiscal quarters.

This was welcome news for Greg Carman, CEO of Fort Smith-based Carman Inc., a traditional truckload carrier of dry freight in the Midwest. He also serves as board chairman for the Arkansas Trucking Association.

"There have been days I wish my family would have opened a flower shop," Carman said, referring to the unprecedented high diesel fuel prices and weak freight demand that have hammered profits and made for long and worry-packed days for small operators.

Carman, who operates 50 trucks and employs 66, said the rough business cycle has been unlike any other in his history.

When compared to the national recession of 2001, which was characterized by a stagnant economy deflating demand, Carman said he and other trucking companies are fighting a two-front war this time with record fuel costs and tepid demand.

While encouraged by the fundamental economics shared by Broughton, Carman said the major worry for he and his colleagues are fuel costs. He said tonnage demand is cyclical and nothing new but $1,000 to fill the tank of one truck is daunting.

Fuel costs, Broughton said, are a demand problem, not a supply problem and relief is not expected any time soon. He told the truckers that energy costs were not a catalyst for weak freight demand.

"The days of $40-per-barrel oil are history, because demand from developing countries is expected to increase and it will be a few years before those countries can develop needed fuel efficiencies," Broughton said.

Broughton told the group that traditional truckload carriers that have continued to stay afloat because of management efficiencies could find more strength by the end of the year as failure rates among less-fortunate carriers are escalating.

He told the truckers that few people, including their customers, realize that trucking companies are paid this week on last week's prices. This creates a financial lag, which in an inflationary environment can quickly erode operating cash flow.

The crowd agreed.

Also, truckers who need a little help from bankers face tighter lending standards that could result in being denied access to cash, Broughton said.

According to Broughton, less-than-truckload (LTL) carriers could see some excess capacity relief by consolidation among two of the sector's largest players before the end of the year. He predicts UPS will likely purchase a large LTL carrier and he predicted the possible failure of another large unionized LTL carrier.

Broughton said interest rate declines should promote better operating conditions for American business, including trucking, in the next two to three quarters.

He encouraged companies to adopt progressive driver policies.

"As the manufacturing base gains steam on the back of the weak dollar and freight demand increases, only the carriers who have drivers to put in the seat will benefit," he said.

Broughton's long-term survival guide for traditional carriers includes:

• Eliminating deadhead - running empty trucks - is crucial because no fuel surcharge can be assessed on those loads.

• Partnering with a railroad for longer haul business, also known as intermodal.

• Using brokerage operations to add flexibility.

• Utilize technology for visibility and planning loads.

• Steal shamelessly good ideas from the best competitors.

By Kim Souza
The Morning News

British Columbia considers truck jail, Rocky Mountain doubles

In British Columbia, Canada, the Transportation Ministry is considering setting up a so-called truck jail similar to the one Ontario has had since 1998.

Trucks found to be grossly unsafe could be impounded for up to 30 days. A truck with “several brakes broken, in combination with bad tires, in combination with bad steering,” would be a suitable candidate for jail, Paul Landry, president of the British Columbia Trucking Association, told the Times Colonist newspaper.

Truck News reported that the province is also considering allowing wider use of so-called “Rocky Mountain doubles,” which proponents say can cut fuel consumption by 30 percent.

In other Canadian trucking news, the Atlantic Provinces Trucking Association in New Brunswick is calling for a provincial tax cut of at least 40 cents per gallon (10 cents Canadian per liter) on diesel fuel.

Diesel has been selling for around $5.60 per gallon ($1.40 Canadian per liter) in the province.

Courtesy of LandLine Magazine

SPECIAL REPORT: Fuel surcharge legislation moving in House, Senate

Wednesday, May 7, 2008 – The days of middlemen using fuel surcharges as a way to beef up their profits may very well be numbered thanks to bipartisan legislation being considered in both chambers of Congress.

A bill introduced May 6 by Rep. Peter DeFazio, D-OR, and co-sponsored by Rep. Thomas Petri, R-WI, and Rep. Brad Ellsworth, D-IN, seeks to mandate 100 percent pass-through of fuel surcharges to whoever actually buys the fuel.

The bill, HR5977, “Truth in Reliable Understanding of Consumer Costs Act,” or the “TRUCC Act,” is identical to a bill introduced in the Senate in late April by Sen. Olympia Snowe, R-ME, and co-sponsored by Sen. Sherrod Brown, D-OH.

“This bill will go a long way toward helping truckers and their shipping customers weather the brutal cost of fuel,” said Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association.

Fuel surcharges have been a staple in the industry as a way that trucking companies can recoup the high cost of fuel. And now with skyrocketing fuel prices, more and more is being collected – but not passed on.

There currently is not a uniform fuel surcharge standard for the trucking industry. Fuel surcharges must be negotiated individually, leaving shippers and truckers vulnerable to opportunistic middlemen.

“It’s all too common for middlemen in the trucking industry to push shippers to pay fuel surcharges, but only pass along a portion of those surcharges to the truckers who are actually hauling the freight and paying the fuel bill,” Spencer said.

To make matters worse, small-business truckers are often denied access to the contracts and rate information negotiated between freight brokers and the shipper or customer they are hauling freight for.

The TRUCC Act also seeks to ensure that brokers and middlemen negotiating a contract to haul freight for a shipper are not using the high price of fuel to exploit that shipper or the small-business trucker who actually hauls the shipper’s freight.

OOIDA issued a national Call to Action on Wednesday, May 7, urging its members to contact their lawmakers in support of the legislation. To read the Call to Action, click here.

Truckers wanting to express their support of the TRUCC Act should call both of their senators and their representative. Those who don’t know who their lawmakers are can call the Capitol Switchboard at (202) 224-3121 and provide their ZIP code to the operator to be connected to the appropriate office.

– By Jami Jones, senior editor

SPECIAL REPORT: Truckers need help �soon� OOIDA tells Congress

Tuesday, May 6, 2008 –If there were any members of the House Transportation and Infrastructure Committee who didn’t think fuel prices were strangling small-business truckers – they probably don’t have the same opinion following a hearing on the topic today.

Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association, told committee members in his testimony during the hearing that small-business truckers are victimized not only by high fuel costs, but also by questionable business tactics in the industry.

“The rising cost of fuel is causing harm to the trucking industry as we know it. Across this nation, small-business truckers are experiencing unprecedented operating cost increases and are being forced to make tough decisions in the name of saving their businesses and providing for their families,” Spencer told members of the committee.

“Unfortunately, the climbing diesel prices have already painted many truckers into a corner and for them it is too late.”

Spencer cited a recent report released by Donald Broughton, a long-time trucking industry analyst now with Avondale Partners LLC. Broughton reported that in the first quarter of this year, 935 companies with five or more trucks failed. That’s a failure rate the industry hasn’t experienced since 2000 and 2001.

“While this data is shocking, it is not the complete picture. Broughton’s data is not representative of the industry as a whole because it only counts trucking companies with five or more trucks,” Spencer told the committee.

Spencer explained to committee members that the blame for these failures cannot rest solely on the shoulders of high fuel prices. Fuel surcharges are a long-standing mechanism the industry has used to recoup fuel costs.

The problem, Spencer told the committee members, is that more and more middlemen are charging a fuel surcharge and pocketing a chunk of it rather than passing it on to the trucker who actually bought the fuel.

“It is common practice for motor carriers and especially brokers to push shippers for higher fuel surcharges, but only pass along a portion of those surcharges to the truckers who are actually hauling the freight and paying the fuel bill,” Spencer told the committee.

When pressed by members of the committee, especially acting Chairman Rep. Peter DeFazio, D-OR, on how this can happen, Spencer pointed to the lack of transparency in trucking transactions.

“(Keeping a fuel surcharge is) often done by charging the shipper in one way … then withholding information or misrepresenting transactional information and compensating truckers in another manner, for example providing one flat rate, which is usually much lower,” Spencer explained.

Even if a trucker finds out a broker is skimming fuel surcharges, Spencer said that with the lack of regulation and oversight of brokers it’s far too easy for bad brokers to fade into the night.

“Every day at our headquarters in Missouri we hear horror stories from small-business truckers about unscrupulous brokers with FMCSA authority who collect money from shippers, but never pay the truckers who actually transport the loads,” he told committee members. “Often, when the truckers try to collect the money due to them, they find the broker has closed up shop and moved on.”

In the end, Spencer called for quality regulations and oversight of the industry to give truckers some relief.

“If we do not find ways to help them soon, small-business truckers will continue to lose their businesses or refuse to drive unprofitably. I have no doubt that we will see greater disruptions in the movement of our nation’s commerce and our economy,” he said.

– By Jami Jones, senior editor

LAWSUIT UPDATE: Allied/North American offer $1.25 million settlement

After having negotiated an $8 million settlement in the fall of 2007 with truckers in a lawsuit about problems with their owner-operator leases, Allied Van Lines and North American Van Lines filed for bankruptcy in February this year with $5 million still due to be paid.

However, the Owner-Operator Independent Drivers Association had its legal team go to bat for the truckers, and the companies have proposed paying $1.25 million of the balance due. Under the original plan filed with the U.S. Bankruptcy Court the carriers wanted the entire $5 million balance wiped clean.

Lawyers from The Cullen Law Firm in Washington, DC, argued that it would be in the best interests of the reorganized companies to ensure that their owner-operators received as much compensation as possible.

The court must still approve the revised bankruptcy plan, and the timing of payments will be determined at a future date.

Originally filed in May of 2004, the truckers’ case alleged that the carriers’ leases failed to comply with federal truth-in-leasing regulations regarding compensation and chargeback disclosures. As part of the case settlement, Allied and North American were also required to implement a new uniform independent contractor operating agreement.

Courtesy of LandLine Magazine