Diesel not good news

[lschultz]

http://intranet.aenetad.net/library/11-2005/truckershighdiesel.htm

 

[klenger]

Linky no worky.

 

[biggieou]

Didnt work for me either. Can you just post the article?

 

[Greenleaf]

Whaaaaaaaa No work.



Wanna see.



GL

 

[lschultz]

I will try it when I get home maybe they got a block on this here puter at work.

 

[klenger]

I think the link is to a server inside your company's firewall. The "intranet" part of the path is suspicious.

 

[lschultz]

Yes its something they had on there library site. It was in the San Antonio Express news 11-6-05 was the date on it. I will have to do a little pondering :--) on it.

 

[lschultz]

Diesel prices run truckers off the road

11-06-2005

Vicki Vaughan

San Antonio Express-News Business Writer



If you think it's bad filling up your gas-guzzling SUV,try filling a fleet of trucks with diesel fuel.



Diesel,which historically had been cheaper than gasoline,soared to record levels last month. While gasoline prices are easing after a huge spike in the wake of Hurricanes Katrina and Rita, diesel has stayed high. Experts say diesel could cost even more next year.



It's high cost is likely to ripple through the U. S. economy, as 70 percent of the nation's goods are delivered by truck and rail and farmers depend on diesel to power their equipment. Diesel along the Gulf Coast sells for an average of $2. 85 a gallon,33 percent more than the $2. 14 a gallon it cost a year ago. The national diesel average is $2. 876 a gallon, up 67 cents from a year ago, according to the federal Energy Information Administration.



Truckers describe the situation as severe. More than 700 trucking companies have failed in the third quarter of this year, up from about 550 in the second quarter,a trucking association reports.

How do they plan to cope?



"I really don't know," said Bill Hale Jr. , president of San Antoino's largest independent trucking company. "Call me back in a month if I'm still in business. We're trembling every day.



Hall,whose Bill Hall Jr. Trucking Ltd. owns 72 trucks, had a semmingly rock-solid, hauling for such major clients as the Texas Department of Transportaion. Hall said he planned on diesel costing $2. 25 a gallon as "the extreme," and bid contracts accordingly. He can't add fuel surchares on the Transportation Department contracts, Hall said, so every haul is eating into his profit.



"The trucking industry doesn"t know what to do right now," Hall said. "They're afraid to bid work. "



Tiffany Wlazlowski, s spokeswoman for the American Trucking Association, which has affiliates in every state, said the cost of diesel "is putting a lot pressure on motor carriers. It's one of their top concerns right now. "



The industry expects to spend 37 percent more on fuel this year, or $85 billion, compared with $23 billion last year, Wlazlowski said.



Diesel has spiked for a simple reason: "We have a diesel shortage," said Tom Kloza, chief oil analyst at the Oil Price Information Service.



When the nation"s gas supply was severely curtailed after the hurricanes, "We were able to import a lot of gasoline," as much as 1. 5 million barrels a day, Kloza said. "But we don't import any appreciable amount of diesel fuel. "



Emerging economies depend on diesel to fire their own economies, so they aren't exporting much. In addition, U. S. diesel specifications are exacting, discouraging production by foreign refiners.



Diesel prices at this level mean "you've got people out there facing disaster," said Larry Daniel, president of America's Independent Truckers Association, based in Clinton,Miss. His organization has members who last year made $75,000 in taxable income who are likely to see their income fall to $35,000 or $40,000 this year, Daniel said.



"Some are taking loads without a fuel surcharge, just hoping they can pay the truck note and the insurance. They end up subsidizing the shippers. "

Todd Spencer, executive vice president of the 131,000-member Owner-Operated Truckers Association, agreed that some truckers are operating on the edge. "We have some truckers operating for $1. 10 a mile, and fuel is costing them 65 cents a mile. While they may operate for a while, if they're taking home anything, they're having to live on the money that should be set aside for maintenance and to replace equipment. "



The Owner-Operated Truckers Association said more than 700 trucking companies failed in the third quarter of this year as diesel prices have soared above $3 a gallon, according to a study produced by A. G. Edwards. That's up from about 350 company failures in the same quarter of 2004, when the price of diesel averaged less than $1. 90 a gallon.



And things could get worse. Spencer fears that diesel prices are headed even higher this winter. That's because demand will rise for heating oil, a product very similar to diesel that refiners produce at the same time. Diesel historically has cost more in winter.



"It gets scary," said Kloza of the Oil Price Information Service, "when you get into the deep, dark part of winter. " Rising demand for diesel in the winter months could mean the fuel will soar to $3. 30 a gallon, he said.



It was more costly diesel, along with other rising expenses, long hours and paperwork, that convinced San Antonio resident Jeff Barker to sell his big rig last summer.



"I sensed that we were going to have events to drive up fuel prices, and I decided to get out while I was still ahead," said Barker, who has racked up more than 1 million miles in almost 10 years as a driver.

"If an owner-operator encounters a major breakdown with his or her truck with profit margins as thin as they are, chances are their profits made for the week, or the entire month, are used to pay for those repairs," he said in an e-mail from the road.



Now,as an employee-driver for Crete Carrier Corp, of Lincoln,Neb, "I may not have the freedom I had before, but I don't have the same responsibilities," Barker said. "I sleep a lot better. "

 

[Jeff H]

Garages, fleets and construction companies have halted hiring for mechanics, due to companies not making enough money to buy parts. Companies have been streching out maintenance. Just hope safety does not take a back seat?

Average driver gets 32 cents a mile. Costs 65 cents a mile just in fuel. If you don't make 3 cents for every dollar you bring in. Might as well hang it up.

 

[Gary - K7GLD]

AHHhhh, you guys are worried and whining about nothing!



Those guys losing their businesses and trucks don't have ANY right to cheap fuel, and if they can't afford to stay in a fuel related/dependent business, they should simply find another job - maybe sell their homes and relocate to an area with better job opportunities.



After all, this IS a Capitalist-based, supply and demand society, and if significant numbers of transportation businesses can't cut it, they SHOULD be shut down and lose all they have, and let the bigger transportation outfits take up the slack - that's what this country is all about - free enterprise and survival of the foulest, er, FITTEST...





NO, *I* don't really believe that - just wanted to beat a few of the Big Oil sympathizers here on the board to the punch...