The Driver Scramble Is On

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ArchieWhite
Posts: 2942
Joined: Thu Mar 25, 2004 11:38 am

Re: The Driver Scramble Is On

Postby ArchieWhite » Fri Oct 10, 2008 7:52 am

Investments that go up slowly, in good times, yet go down fast, real fast, in bad times, is probably not for the weak of heart. I need some nitroglycerine.

bigmove
Posts: 438
Joined: Fri Oct 05, 2007 6:56 am
Location: California

Re: The Driver Scramble Is On

Postby bigmove » Fri Oct 10, 2008 9:12 am

Up 563 from 8000, we might have found the bottom.

EastCoastMover
Posts: 173
Joined: Wed Nov 16, 2005 1:48 pm
Location: Indiana

Re: The Driver Scramble Is On

Postby EastCoastMover » Wed Oct 15, 2008 6:03 pm

seems that was wishful thinking.....its past ugly now... its really gettin fugly

bigmove
Posts: 438
Joined: Fri Oct 05, 2007 6:56 am
Location: California

Re: The Driver Scramble Is On

Postby bigmove » Wed Oct 15, 2008 6:42 pm

It is still at 8,577, so it is still possible that we have hit bottom. I must admit, I didn't expect a 700 point drop today. A lot of earnings are yet to be announced, so it certainly could find a new low.

For those industry people out there, it might be worth keeping an eye on YRC Worldwide (YRCW is the symbol). Stock price is down to 4.00/share, and they are having issues. They operate 17,000 tractors, and are a massive unionized LTL carrier. They assumed over 4 billion dollars of debt at the end of last year, to buy out of the Teamsters famous pension fund. If they bite the dust, I'm not sure who would buy them at any price.

bosoxfan
Posts: 148
Joined: Mon Feb 11, 2008 1:36 pm
Location: Maryland

Re: The Driver Scramble Is On

Postby bosoxfan » Thu Oct 16, 2008 7:22 am

I realize this forum is focused on the household industry, but I find it very interesting how much the current economic environment is impacting various trucking related businesses. Earlier this week, it was made known that Gainey Transportation is in serious trouble and is very close to filing chapter 11. Wachovia Bank claims that Gainey has stopped paying on their loan since April and owes them close to 26 million dollars. Gainey purchased the flatbed and blanket wrap divisions of NAVL from Sirva in 2005. That purchase did not work our as well as they thought.

When I see issues like this - it just makes our vote in 2 weeks even more important. The greed of the Wall St executives and the OPEC countries, are having a distinct impact on all truck related industries - which is a real shame.

gumbyhead
Posts: 5
Joined: Thu Oct 16, 2008 7:07 am
Location: Pittsburgh,PA

Re: The Driver Scramble Is On

Postby gumbyhead » Thu Oct 16, 2008 7:37 am

promover2 wrote:Hang on to your drivers!! The driver squeeze is in full effect. I have had drivers from every major van line walk through my office door in the past 3 weeks looking for a new gig. (just stole two really good ones -- one from Atlas and one from United). Most of them have been high quality contractors based on my meetings w/ them and looking over their qual packages. One guy said he was making 57% at United!!! Yikes, are agents really paying that much! We are up to 55% for our drivers that achieve van line recognition, but 57% seems awful high for an o/o. I hope he's embellishing.


Perfect. Another Van Line thinking they are paying too much money for "really good" ones. His 57% was probably the 55% plus the 2% ATC. But what is it about 55% that you apparently think is too high? Tough to make a living on 65-70% discounts and only get 55% of the revenue. Tires are up, diesel is up, labor (quality, if you can find it) is up, repairs are up, food on the road is up. We stay mostly in hotels near the shippers origin/destination so we are fresh in the morning, and those are going up. Tough to stay at a truck stop 70 miles away, get up and drive for 2 hours (traffic) and load/unload for 9 hours. Sadly, not all shippers have a place to park a truck right down the street from their house. Not to mention new trucks (white, to make the Van Line all happy and that) are up 20% over the last 5 years.

Try getting your next driver from McCollisters. He's now writing 50% contracts for buggers. Remember, ya get what ya pay for.
Faster, Cheaper, Better. You only get to pick 2.

ArchieWhite
Posts: 2942
Joined: Thu Mar 25, 2004 11:38 am

Re: The Driver Scramble Is On

Postby ArchieWhite » Thu Oct 16, 2008 7:56 am

Thats the way to jump right in there Gumby, good points too. This website now has a good cross representation of drivers, sales, mgmgt, bankers, customers, both happy and sad, agency owners, even a lawyer or two. We're all in this together, and we may all be on the same sinking ship. ( and thats not a Mayflower double entendre)

I run about 25 HHG vans and 5 spec coms, and I can tell you, the buggers ( hhg) can only make money 3 or 4 months out of the year. They haul stuff year round, but break even, or lose ( go in the hole) and then have to work like crazy in June-July-Aug, to get back to even. Our drivers haul a fair mix of COD,Mil and NA, and some pack and load, some just haul. 1/3rd are coast to coast the rest 1200 mile radius. None of them have bought a new tractor in 5-6 years, we have not bought any new trailers in 4-5 years, and don't plan on doing it, until we see if this industry will survive. The next 2-3 years will tell me whether there is a chance or not. If people cannot buy and sell houses, if corporations cut way back on transfers, and if the military ends up doing what they always do ( going with the low bid), this industry will go back to where it was years ago, cowboys and gypsies instead of quality drivers, who own their own truck and run their operation like a professional.

And I don't think whichever party wins next month will make much of a difference. Sure, one says he will raise taxes, and the other says he won't but you can't trust those guys. Most politicians have never had a real job, where they had to meet payroll on Friday. Or had to deal with customers in distress, decisions on pricing, hiring, firing, purchasing, all that stuff. Most politicians are ex-lawyers, who make a living off of other peoples distress, usually. I'm painting with a broad brush, but my observations ( this was my 43rd summer in this biz) is that we are headed for trouble, things will get worse before they get better.

If I were a hhg driver, I would hook up with an agent that has a decent mix of all tonnage, or was heavy into Military, which is the best right now....I would study all loads before accepting, and turn down the crap that won't pay the bills. I would also have my truck paid off, or would only own a 3-4 year old low mileage truck with affordable payments. The days of $140,000 condos may be over for a while. I would fight every claim charged back to me, of course that means making a good inventory first. Lots of claims are paid just to quiet a national account customer, and charged to the driver, hoping he won't notice.....they can still pay the claim, but if the driver cannot be proven to be responsible, the agent/carrier should eat it, not try to sneak it onto the drivers settlement.

I think I would challenge most bound jobs too......if there is any doubt. As desperate as things are, you just know that some salespeople are going to shave weight, and keep their fingers crossed.

Stay on the forum and give your opinions, nothing is sacred here,

oldschool
Posts: 11
Joined: Fri Jun 06, 2008 7:32 am

Re: The Driver Scramble Is On

Postby oldschool » Thu Oct 16, 2008 8:27 am

Don't mean to steal your thunder Archie, but I thought this was interesting.


Gainey Corp. Issues Statement Regarding Chapter 11 Reorganization Filing
GRAND RAPIDS, Mich., Oct. 14, 2008 – Gainey Corporation today issued the following statement:


“As we noted in our Sept. 30 announcement, the nation’s financial crisis has compelled our lenders, including Wachovia Bank, to make ill-advised decisions based on their own cash constraints. Those constraints have placed Gainey Corporation and its operating companies in a very difficult situation,” said Harvey Gainey, CEO.
“Our exhaustive efforts to negotiate a constructive agreement with our lending group have been met with a series of increasingly aggressive actions by these lenders.
“Faced with recent actions by Wachovia Bank, the Company has decided that the only reasonable course that will allow us to serve our customers and preserve jobs is a Chapter 11 reorganization filing. Our sound business fundamentals – which include positive cash flow and operating income – will continue to ensure our uninterrupted operations, including paying all suppliers, delivering all freight and meeting our payroll.”

ArchieWhite
Posts: 2942
Joined: Thu Mar 25, 2004 11:38 am

Re: The Driver Scramble Is On

Postby ArchieWhite » Thu Oct 16, 2008 8:32 am

No problem, my thunder usually is barely a drizzle anyway........I've heard of other companies, in other industries, unable to get short term cash, so this could be a trend. Sounds like the old 'Cash is King' theory is true.

promover2
Posts: 243
Joined: Sat Mar 08, 2008 9:29 am
Location: Tampa, Florida

Re: The Driver Scramble Is On

Postby promover2 » Thu Oct 16, 2008 8:58 am

gumbyhead wrote:Perfect. Another Van Line thinking they are paying too much money for "really good" ones. His 57% was probably the 55% plus the 2% ATC. But what is it about 55% that you apparently think is too high? Tough to make a living on 65-70% discounts and only get 55% of the revenue. Tires are up, diesel is up, labor (quality, if you can find it) is up, repairs are up, food on the road is up. We stay mostly in hotels near the shippers origin/destination so we are fresh in the morning, and those are going up. Tough to stay at a truck stop 70 miles away, get up and drive for 2 hours (traffic) and load/unload for 9 hours. Sadly, not all shippers have a place to park a truck right down the street from their house. Not to mention new trucks (white, to make the Van Line all happy and that) are up 20% over the last 5 years.

Try getting your next driver from McCollisters. He's now writing 50% contracts for buggers. Remember, ya get what ya pay for.


Gumby,

So you're wanting to take the price of diesel, labor, food, etc. out of the agent's cut? How is that the agent's responsibility? Why doesn't anyone bitch to the van line??? Has any van line lowered their percentages to help out the drivers and agents (TOGETHER) who both have the burden of paying for these things? No.

And FYI, I just raised our linehaul commission to 57% as our max and contracted with the owner/operator I was talking about. When the other drivers' contracts are up, they will all get the increase without having to ask for it. I think we do a good job of making our contractors happy. Since I am taking the hit, I have earned the right to complain about it. I just don't like the drivers that come in and lie that they were making 60% at some other agency, when I know we are pretty close to the top of the pay scale. Your comment about McCollister's proves that right. But they have volume. Would you rather have 50% of $300,000.00 in linehaul or 57% of $200,000.00?


Those of us who own small agencies are not the fat cats that sit around board rooms all day. One day this summer, I showed up at my office at 4am, completed payroll and other managerial tasks, met with a potential national account at 9am and by lunchtime I was blasting up I-75 in a truck to deliver in Georgia the next day. So don't expect the agents to play violins for you when it comes to the cost of tires, diesel, labor, food, hotels etc. Blame your President, Congress, Wall Street or the OPEC nations.

My advice to you, stop staying in hotels, make it a rare occurrence when you absolutely need one. I've rarely been forced to stay in a hotel, you can always find a truck stop, rest area, agency, parking lot, etc. within a reasonable distance from the shipper's house. Also, if you're going to stay in the industry, invest in a generator. You'll use less fuel, which by the way is down below $80/barrel. Diesel has dropped since it's peak in July.

gumbyhead
Posts: 5
Joined: Thu Oct 16, 2008 7:07 am
Location: Pittsburgh,PA

Re: The Driver Scramble Is On

Postby gumbyhead » Thu Oct 16, 2008 8:59 am

Arch: I was terrified I'd have some smartass agent rip me a new one with that post, but had to put it out there.

I drove for UVL when they rewrote the tariff to the 400N, and, maybe it was just me that figured it out, but it boiled down to the fact that they can't get us to drive for less than a 50% contract, and to discount more than 70% would hurt THEM too much, so they just re-write the tariff to get US to pay more out of our own pocket. But we were assured that we would make the same revenue on the 400N. I want their accountant.

The labor that we're getting now is the worst I've seen in years, yet they all want minimum $15 an hour/$1,50 ctn wgt. to stand around and talk on the phone and take a smoke break every 30 mins.

My latest truck cost an astounding $135k, the roads eat shocks and tires for breakfast, not to mention the truck now rattles like marbles in a can, insurance has skyrocketed, repairs are now up to $110 and hour. And your lucky if they fix it right even on the second try. I just saw diesel in IN for $3.60 a gallon and thought that was a steal. But then I'll get hammered on the fuel tax cause I'm going into NE.

Military is now back to the old days with the families first stuff. My line haul from Colo Spgs to the NE with 24k is $9000. 105%. What a great country. We have now turned the HHG industry into WalMart. What's next? Brain surgery on a budget? "I'll take the low bid on my bypass surgery, thank you."

I hope that more customers read these posts and realize that this is a SKILLED job, and that you GET WHAT YOU PAY FOR. You want a budget move? Expect crackheads for lumpers and a Swift driver to supervise. There's not a driver shortage, much as the transportation wonks would have you believe. There's a shortage of drivers that will drive/work CHEAP.

Whew! Think I'll go lift 15k so I can cool off.
Faster, Cheaper, Better. You only get to pick 2.

ArchieWhite
Posts: 2942
Joined: Thu Mar 25, 2004 11:38 am

Re: The Driver Scramble Is On

Postby ArchieWhite » Thu Oct 16, 2008 9:11 am

I think the driver situation ties in with the struggles that we are all facing.....in the last couple of years, I have seen many long time, family owned and operated moving companies go out of biz. Big and small, and more to come, maybe the shakeout is good in the long run, but all the movers I've known, down thru the years, are exactly like promover......long hours, low pay, sell a job one day, load it and deliver it the next. Since most of the movers in smaller towns were almost always mom and pops, mom answered the phones and did the paperwork, and pop dispatched the crews, supervised the warehouse, filled in wherever, and did the dirty work. Some lucky ones had a salesperson to do that part, but not all. Kind of like Joe the plumber on tv last night. Joe is willing to buy a biz, and work long hard hours, but if his industry disappears, so will he.

gumbyhead
Posts: 5
Joined: Thu Oct 16, 2008 7:07 am
Location: Pittsburgh,PA

Re: The Driver Scramble Is On

Postby gumbyhead » Thu Oct 16, 2008 9:19 am

promover2:

You just proved my point. You, the agent, can write more volume to make up for sales people that can't sell; who just discount and take orders. If competition is so tough, become better salesman. To keep business coming back to my company, and no matter how bad things have gotten, I've kept my driver ratting up (1-100).

I can only carry so much tonnage based on working hours and drive time. And as the discounts get deeper, and the cost go up, I keep looking for ways to save money.

I only stay in motels when I am in an area that doesn't have a place to park close to the shipper. And I do have a gen set. But I insist on showing up at the shippers showered and shaved, and if I stay at an agents lot, where do I do that. Very few have those facilities. Stay at the WalMart lot? Where am I going to do that. Truck stop? if I'm picking up in LA, the closest truck stop is 65 miles away. 2 hours in LA traffic. This doesn't include having to stop at the agent to get laborers, who lately don't seem to have a DL.

The point I'm making is that even if I stay on the road 12 months at a time, my take home is now getting down to a McDonalds manager level. How is that fair? I'm not asking for you to bear any of my costs, and never implied that. But my pay is shrinking every year, and thats getting tough.

Thanks for listening.

BTW: Archie, told ya someone would jump on me!
Last edited by gumbyhead on Thu Oct 16, 2008 9:25 am, edited 1 time in total.
Faster, Cheaper, Better. You only get to pick 2.

promover2
Posts: 243
Joined: Sat Mar 08, 2008 9:29 am
Location: Tampa, Florida

Re: The Driver Scramble Is On

Postby promover2 » Thu Oct 16, 2008 9:25 am

Very true. If the situation doesn't improve, there will be nothing to talk about because many of us will be out of business. We made a calculated decision in 2006 to stop buying equipment and to stay put in our tiny 15,000 square foot warehouse. We did buy a straight truck last year, but that was because one blew an engine. So we're just replacing the old, but no expansion.

I envy those like Archie with minimal debt and a lot of paid off equipment. I value the amount of work that goes into a paid off truck or building, etc. We are still in our infancy (only 8 years old) and most of our trailers plus 3 or 4 company trucks still have notes on them still. (many of the banks that gave us our initial vehicle loans are gone). SouthTrust Bank was our first lender which was bought by First Union, which was bought by Wachovia which was bought by Wells Fargo last week.

Gumby - $135K is a tough loan to tackle on a tractor - not knowing what you put down of course. Hopefully you can pay it off and get your Return on Investment on the back nine. I just had a driver pay off his tractor - freed up $1,800.00 per month. He was so happy and I was happy for him.

ArchieWhite
Posts: 2942
Joined: Thu Mar 25, 2004 11:38 am

Re: The Driver Scramble Is On

Postby ArchieWhite » Thu Oct 16, 2008 9:26 am

I don't think he was jumping, just a little different perspective. I think we all wonder sometimes why we do it. Long hours, low pay, low respect from customers, it gets to be a drag sometimes.


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