why is XPO expedite so dead

[ATeam]

the whole industry has been destroyed, thank you carriers and brokers....as I've said many a times....we are now carriers of straight truck loads at cargo van prices....this industry is a done deal....there is no toilet..whats flushed is flushed...and gone....this is the new and improved version of what you can expect from now on....live it with it or get out....

I'm not sure I agree that the whole industry has been destroyed. I do note that technology is an important factor that must be considered when assessing long term trends. Early expediters crow about the good money they were once able to make. They also tell stories in which the good old days included carrying a supply of coins and making frequent stops at telephone booths to check in with and/or report to dispatch.

In those days, there was no internet. Carriers, which were then few in number, were the only ones who knew where their trucks were and which were available. Carriers controlled this vital information and they could command a high price because of it. Also important in those days was the new approach in manufacturing. Warehousing became old hat and just-in-time was coming into vogue.

Since then, expediting has expanded to multiple carriers, increasing competition and driving prices down. With the Internet and mobile phones, a single truck can post itself in a number of ways to be seen by shippers, brokers and carriers. Now, shippers can use the internet to instantly bid loads with dozens of carriers and hundreds of brokers, and shippers can use load boards themselves to see thousands of trucks if they choose. Carriers no longer have the information lock they once did and the premium that comes with it faded with the telephone booth.

It seems to me that technology and increased competition have driven rates down more than any other two factors. Comparing the expediting days of old to the expediting experience today is an interesting exercise. Expecting the pay of old to apply today is an exercise in frustration.

Seeing these long-term trends continue to play out in the then-present day, Diane and I found a more appealing opportunity and got out of expediting. When we did, we were at the top of our game, running happily with Landstar Express America and making great money. But we also saw the coming decline in rates and knew that there was no way we could replace our spectacular, all-the-comforts-of-home truck with one like it in the future. There was not enough money on the horizon to live the quality of life we wanted on the road and book substantial profits too.

 

[OntarioVanMan]

I'm not sure I agree that the whole industry has been destroyed. I do note that technology is an important factor that must be considered when assessing long term trends. Early expediters crow about the good money they were once able to make. They also tell stories in which the good old days included carrying a supply of coins and making frequent stops at telephone booths to check in with and/or report to dispatch.

In those days, there was no internet. Carriers, which were then few in number, were the only ones who knew where their trucks were and which were available. Carriers controlled this vital information and they could command a high price because of it.

Since then, the industry has expanded to multiple carriers, increasing competition and driving prices down. With the Internet and mobile phones, a single truck can post itself in a number of ways to be seen by shippers, brokers and carriers. Carriers no longer have an information lock and the premium that comes with it faded with the telephone booth.

It seems to me that technology and increased competition have driven rates down more than any other two factors. Comparing the expediting days of old to the expediting experience today is an interesting exercise. Expecting the pay of old to apply today is an exercise in frustration.

Seeing these long-term trends continue to play out in the then-present day, Diane and I found a more appealing opportunity and got out of expediting. When we did, we were at the top of our game, running happily with Landstar Express America and making great money. But we also saw the coming decline in rates and knew that there was no way we could replace our spectacular, all-the-comforts-of-home truck with one like it in the future. There was not enough money on the horizon to live the life we wanted on the road and book substantial profits too.

Destroy may have been over the top....eroded may have been a better choice....
and yes Phil.....you don't see many trucks of your stature entering the field...the ROI just isn't there....the fleets now look very shabby....

 

[ATeam]

Destroy may have been over the top....eroded may have been a better choice....
and yes Phil.....you don't see many trucks of your stature entering the field...the ROI just isn't there....the fleets now look very shabby....

That's sad to hear. We saw the beginning of that trend toward the end of our expediting career. While some very nice trucks were still being built, the sleepers were getting smaller and some of the features were being omitted. With standard trucks, it seemed that their age was increasing and their appearance was declining. We met several expediters who were booking respectable profits but many of them were running older and less-luxurious trucks to do it. Having been spoiled by the truck we had, we got out while the getting was good.

 

[jjoerger]

I once planned on buying a new truck. Then I changed my plan to buying a newer used truck. Now I plan to keep my old truck and see how long I can keep it running. The money just isn't there to upgrade. With the current cost of fuel I am making the same or less per mile than when I started in 2008. Everything else has gone up in price. Tires, oil, insurance, etc. Everything but my revenue.

 

[OntarioVanMan]

I once planned on buying a new truck. Then I changed my plan to buying a newer used truck. Now I plan to keep my old truck and see how long I can keep it running. The money just isn't there to upgrade. With the current cost of fuel I am making the same or less per mile than when I started in 2008. Everything else has gone up in price. Tires, oil, insurance, etc. Everything but my revenue.

some tender loving care...a good preventive maintenance plan..maybe a coat of paint...you should be good to go for awhile...

 

[acvox24]

I looked at buying a new truck. But now there so expensive there selling them with 7 year loans. Which in this business means you need to be making double payments. Just to much I'm going just try to keep the one I got as long as I can.

 

[iceroadtrucker]

Destroy may have been over the top....eroded may have been a better choice....
and yes Phil.....you don't see many trucks of your stature entering the field...the ROI just isn't there....the fleets now look very shabby....

Agreed the Trucks look Shabby falling apart Spray Painted Hoods Wire Harness shorted out blinker lights not working, Air bags leaking trailer breaks that needs need new Hubs and pads. People not in uniform, when they go to the Shippers and Consignees. People Trucks and Equipment sad shape. Then you got the Crap in the Trailers Mold in the Reefer Trailers because people are too lazy to do wipers.

The Price of Freight and No freight no loads People wont spend the money on Trailer Wash outs or put the extra effort to hold wipers and sweepers in the Trailers. Why well because the Pride and Conviction and Prestige that once was has went down the drain. Money, Loads , work got a lot to do with it. Look at the Crap that's out there. But that's because cost cutting. Expedite is not what it was 10.85 years ago. Back then there was plenty of freight.

Contractors made a living and were able to pay for trucks health care and eat decent meal and take care of there family. Not so today. The Companies push price of freight down in keeping with competition of the other guy.

No freight and yet the companies keep putting trucks on. That don't make no sense. If you don't have the freight base then you stop putting trucks on. If you don't have the work or need for more people in an office or company driver, are you going to keep hiring for a position that's not there No.

So why do it to your Contractors that drive for the company. In reality the truth is in the Contractor world there is no such thing being on team. In the Contractor world the guy sitting next to you at the company is your competition just as the guy on your other side from another Expedite Company is your competition as well.

The ole Term 2 Men an a Truck for Expedite is a good.. For Team Runs that is. Cant make 300 a week after taxes per person an expect to keep a team. Unemployment is 700 a week tax free get my drift.

NEED More work!!!

One last note if you want cheaper Company drivers maybe your next step but then again the big issue Tractors and Trailers and Health Care. Not to mention the Tolls. If we read the tabloids and watch the News you must agree that the Congress and Senate are Pushing to do away with 1099s due to contactors not pay there taxes quarterly and Uncle Sam loosing Money.

The whole thing is a chain reaction. Low freight Prices , Hardly no work, Shabby Equipment, not dressed for Success, all a down turn.
Need to take a round turn and take off the Blinders there is no Plow Horses out here.

Garbage is taken out
Have nice day

 

[Greg]

Expedite is not what it was 10.85 years ago.

Now that is the most specific time period I have seen noted in a while. j/k

 

[Bruno]

Looks like FedEx is trying to be like Landstar

Naw, its totally different from the Landstar board from what I have been told. No favorites at FedEx Custom Critcal. The price is posted and you either want it or you don't. It's first come first serve, meaning whoever accepts the load first gets the load. You have to be able to legally do the load also. I tried to get our old carrier to do this with the agent network and they thought I was crazy. It's a win/win for everyone if you ask me.

 

[Bruno]

Some fleets may look shabby, but not all. We try to keep our trucks washed and clean. We ask that drivers send us pictures of the truck once a month to make sure they aren't messing our units up. The truck I'm in right now is clean and washed.

 

[davekc]

I am more of a "the glass is half full rather than half empty". With that said, I do think it is a evolving business model that has put downward pressure on single truck operators. It is true that we made considerable money through the eighty and nineties. Technology is a double edge sword. It has saved money and made things competitive at the same time. Really, much like other businesses that are affected in the same fashion.

Some are getting priced out of the market. A 70k truck 15 years ago is now 160k and counting. All while running somewhere around the same rates or less while every other cost has risen. Again, no different than other businesses. Here is what I do see changing. I see more movement to a fleet owner model. Simply volume drives down the other costs. For example, insuring a fleet is cheaper per truck than a individual. Same with buying vehicles, maintenance and on through the list.

Breakdowns, accidents, health or family issues, regen issues, the whole list is more easily absorbed from a fleet owner because they have cash flow and other trucks running. Any one of those could doom a single truck operator if they are not capitalized correctly. Our industry is full of those examples. Good for fleet owners, caution for single truck operators. One of those "businessman first, driver second".

Another upside in a turbulent economy is drivers income. Not sure this applies to vans since the market is saturated, but by most standards, the folks driving for us all make well above national averages on income. If we hire folks out of depressed employment regions, expediting can and still is a winner.

 

[Moot]

you've been around a long time.....ever seen an increase over the last 17 yrs...and you can't count FSC

I have had two increases. My first raise was when Con-Way increased their rates in 2000 or 2001. Being on a percentage, my per mile rate increased. My second raise was a 1½ percent longevity raise after 5 years.

My first pay cut was a 22 percent drop going from a percentage to a flat rate per mile. Took another flat rate cut at Panther and got hosed going to the structured fuel surcharge.

 

[Moot]

I am more of a "the glass is half full rather than half empty".

What's in the glass?

 

[OntarioVanMan]

I have had two increases. My first raise was when Con-Way increased their rates in 2000 or 2001. Being on a percentage, my per mile rate increased. My second raise was a 1½ percent longevity raise after 5 years.

My first pay cut was a 22 percent drop going from a percentage to a flat rate per mile. Took another flat rate cut at Panther and got hosed going to the structured fuel surcharge.

% drivers will see the fluctuations in the rates... Kinda like the markets

 

[Moot]

% drivers will see the fluctuations in the rates... Kinda like the markets

Not back then, at least not with Con-Way. They had a set tariff for all their customers so my rate only changed when they increased the tariffs once. Eventually we began doing NLM loads at a 22% discount which over time led to the flat rate.

 

[davekc]

What's in the glass?

In my case for health purposes, it is wine.

 

[blizzard2014]

some tender loving care...a good preventive maintenance plan..maybe a coat of paint...you should be good to go for awhile...

All good cept for the fact that some shippers will not load Boxes that are older than ten years. That includes trailers and straight trucks!

 

[blizzard2014]

Shippers like Ford and others want it both ways. They want to pay extremely low rates, but they also require drivers to operate newer equipment. That's just not feasible anymore for the single operator!