The A Team’s Phil Madsen recently mentioned in some of his posts that there are flat rate trucks in the FedEx Custom Critical fleet. We became interested in knowing if there was a flat rate program for straight trucks and if so to learn more about it. It turned out there is and I posted about it in the FedEx forum.
We talked with our recruiter, contractor relations and a flat rate fleet coordinator to learn as much about this program as possible. We then did an analysis projecting income potential from this program and comparing it to our current income. We determined that the rate per mile we would receive was just a little lower than our current average, but the increased miles potential out weighed the minor loss in revenue.
But we still weren’t sure if this would be a good program for us.
We then read some more post by Phil. Phil discussed how the flat rate trucks were taking the good/great loads, long coast to coast runs and suspected preferential treatment.
Here are a couple of great quotes from Phil on the ramifications of having flat rate trucks in the fleet.
“If it is slow all over, it will be even slower for the FDCC percentage-paid trucks that are now being passed over by a preferential dispatch system that is designed to load flat-rate trucks first. If it is slow and the FDCC run count declines, the flat-rate trucks will see no difference. It will be the percentage-paid trucks that take the hit so the flat-rate trucks can keep running.”
Not good for us as we are a percentage paid truck.
“Dry box trucks will get hurt too as reefer contractors decide to play in the dry box arena. As high paying reefer loads decline in frequency, and the need to pay the bills asserts itself, it won't take much for a number of reefer contractors to go after the freight they were previously willing to let the dry box contractors have.”
Even worse for us as we are a dry van that will have even more competition.
We believe that Phil is a very knowledgeable and experienced. He has brought up some very good points and we factored his thoughts into our decision and we just want to say, “Phil, I sure hope you were right”, because as of today we are now a flat rate straight truck in the FedEx CC fleet.
We will report back and let everyone know how this program is working for us.
We talked with our recruiter, contractor relations and a flat rate fleet coordinator to learn as much about this program as possible. We then did an analysis projecting income potential from this program and comparing it to our current income. We determined that the rate per mile we would receive was just a little lower than our current average, but the increased miles potential out weighed the minor loss in revenue.
But we still weren’t sure if this would be a good program for us.
We then read some more post by Phil. Phil discussed how the flat rate trucks were taking the good/great loads, long coast to coast runs and suspected preferential treatment.
Here are a couple of great quotes from Phil on the ramifications of having flat rate trucks in the fleet.
“If it is slow all over, it will be even slower for the FDCC percentage-paid trucks that are now being passed over by a preferential dispatch system that is designed to load flat-rate trucks first. If it is slow and the FDCC run count declines, the flat-rate trucks will see no difference. It will be the percentage-paid trucks that take the hit so the flat-rate trucks can keep running.”
Not good for us as we are a percentage paid truck.
“Dry box trucks will get hurt too as reefer contractors decide to play in the dry box arena. As high paying reefer loads decline in frequency, and the need to pay the bills asserts itself, it won't take much for a number of reefer contractors to go after the freight they were previously willing to let the dry box contractors have.”
Even worse for us as we are a dry van that will have even more competition.
We believe that Phil is a very knowledgeable and experienced. He has brought up some very good points and we factored his thoughts into our decision and we just want to say, “Phil, I sure hope you were right”, because as of today we are now a flat rate straight truck in the FedEx CC fleet.
We will report back and let everyone know how this program is working for us.
