Fuel Costs and who is to blame?
- Thread starter normanjean
- Start date
That's because nothing comes out of AB unless it's on rail. The truck has to make enough drive out of the freight desert and someplace where there is freight - usually back to IL. You can wait for days out there and pay your driver to do nothing which doesn't work either.
It makes sense - 1600 miles - Chicago to Edmonton. Then drive back is 3200 miles. 3200 X 2.00 per mile = $6400.00. At $2.00 per mile that carrier is under cutting the rate.
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AB is brutal - so yes the rate makes complete sense .. FYI my truck just fueled in Michigan City IN - $5.34/gallon USD
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actually getting 3/mile out of Alberta lots of work out there last 3 months but do agree it is usually a dead zone for freight.
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Brokers that tried to keep our wheels turning over the past three years are getting favorable rates back from us. Those that didn't.. eh.
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Shakey
Site Supporter
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Yes, we do the same to carriers, treat them the way they treat us. If they have issues with it, they need to look in the mirror.
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Most of the smaller carriers I deal with don't understand fuel surcharge
We have an all in rate with many carriers -- base + FSC but not broken out, adjusted as needed.
Fuel went up 25% so they add 25% to the all in rate and say this is the new rate.
They need to go back to last rate adjustment, back out FSC at that time to find the base rate then add the new FSC.
This is a very different number and convincing them of this is nearly impossible because "diesel is over $5.00 per gallon brother"
I'm paying carriers based on the new FSC while still trying to get rate adjustments from customers, possibly looking at 1+ weeks of negative margins depending on the account.
We have an all in rate with many carriers -- base + FSC but not broken out, adjusted as needed.
Fuel went up 25% so they add 25% to the all in rate and say this is the new rate.
They need to go back to last rate adjustment, back out FSC at that time to find the base rate then add the new FSC.
This is a very different number and convincing them of this is nearly impossible because "diesel is over $5.00 per gallon brother"
I'm paying carriers based on the new FSC while still trying to get rate adjustments from customers, possibly looking at 1+ weeks of negative margins depending on the account.
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So now the fuel is through the roof. Brokers need to get it together and realize cheap freight movement is long gone. We as carriers need to be paid for the loads
It really depends on how FSC is applied, I'ev had customers flat out pay a percentage on top of the base rate as FSC. EX: $325.00 +35% ($113.75) FSC= $438.75.
Others apply it as ex. (40% of the posted FSC per FCA). If you go by All in rates then applying a FSC to it will get you carriers doing just that (add 25% on top of the All in rate).
Food For thought, see below for our postal services FSC, it went up 7% from this week to the next...
When brokers got lazy and just asked for "ALL IN RATES" instead of doing actual math, we cant really complain that carriers turn around and bump their all in rates by 25%, can we? maybe we can. Free country.
Fuel Surcharge Calculator
Fuel Surcharge Calculator What you need to know: Currently there’s no rule, law, or regulation mandating a fuel surcharge. Small carriers with direct shipper freight contracts must incorporate a fuel surcharge. Good carriers will typically pass through 100% of the fuel surcharge to their...
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