Truck Topics

End of the Year Observations

2008: Quite a rollercoaster ride, eh?

This past year will go down in the books as a year of highs and lows.  Fortunately, it is almost over, but unfortunately, it is ending on an extremely low note with the economy tanking and nothing but negative stories on the evening news.

Some of 2008's top stories, in no particular order, include:

Fuel Prices:  The year of 2008 saw oil hit a record $147 then plummet to $35 a barrel.  After years of steadily increasing fuel costs, culminating in $5.00 and above tariffs, owner-operators were given some relief towards the end of the year.  

Hours of Service: After considerable legal maneuvering and grappling over the past five years, nothing has really changed in the HOS regs. Many in the industry found themselves protesting the “new” regs alongside trucking watchdog Joan Claybrook of the consumer group, Public Citizen. She announced her retirement after 27 years, but will remain on the board.

Companies fall victim: Flying J truck stops and IdleAire both filed for Chapter 11 bankruptcy protection while Jevic Transportation and Alvan Motor Freight closed their doors along with nearly 2,000 other trucking companies.

Daimler closes Sterling: In a major restructuring of Daimler Trucks North America (DTNA), its parent Daimler AG announced that it will end production of the Sterling brand, close its Portland, OR, and St. Thomas, Ontario, truck plants, and move production of Western Star trucks to a new plant in Saltillo, Mexico.

Obama victorious in presidential bid:  Barack Obama’s election as the 44th President of the United States will have wide-ranging effects on the nation’s energy and transportation policies, as he has pledged to increase funding for infrastructure and alternative energy development and to make efficiency standards more stringent.

Economic bailout: According to trucking industry analysts, it is difficult to forecast exactly what impact the $700 billion financial-market bailout signed into law will have on credit availability and the trucking industry in general.


What about expediting?

Once again, the fast freight industry has seemingly avoided the bankruptcies, closures and train wrecks that regularly occur in general trucking during tough economic times.  Despite slow freight, stagnant and even decreasing freight rates and the automakers' plant shutdowns, expediting keeps pluggin' along.

Even though the economic forecast is a generally gloomy one, the officials of two successful expedited carriers are optimistic about the coming year and share their thoughts here:


Jeff Curry
President, Express-1 Expedited Solutions

2008 was a year marked by collaboration as well as conflict with city, county, state and federal governments.  With the support of county and city officials, we were fortunate to receive a grant of over $200,000 to extend fiber optic cable to our offices in Buchanan.  This took our Internet connection from the speed of a two-lane highway to that of an 80 mph German autobahn. We complemented this new technology by replacing our backup power systems.  The city convinced Comcast to run cable to our building, which gives us superior redundant internet capability.

While our infrastructure was improved with the help of government, we spent a lot of time arguing with the state over the harsh nature of the new Michigan Business Tax (MBT). We hosted the senator chairing the MBT committee and the president of the Michigan Trucking Association (MTA) to present our views. While this tax has been instituted, we hope that a revision will be forthcoming once the harsh results of the tax become evident. Secondly, we fought against the state’s attempt to drastically increase its fuel tax.

Again, we worked with the MTA and our state senator to cut off  this onerous legislation at the pass. While we continue to wait for the Senate to act in our favor, I am proud that the MTA wanted to team with Express-1 on these issues.

In 2008, Express-1 undertook two important initiatives with the federal government.  We were successful in becoming a SmartWay Transport Partner with the Environmental Protection Agency and began an educational program to help owner/operators see the financial advantages of going green.  
In house, we expanded our recycling program and reduced energy consumption.  Earlier this year, we received approval from the Department of Labor for the nation’s first owner/operator-based truck driver apprenticeship program.  We are now working with the Veteran’s Administration to have this program approved for GI Bill benefits to give us the means to reach out to veterans wanting to pursue a driving career.

As we enter the new year and as the economy continues its contraction, we are fortunate to have a diversified business mix in which only 20% of our revenue comes from the automotive industry. In 2008 we had more international freight than expected and we see this part of our business growing in 2009. We’ve increased our sales staff and are expanding our sales presence into new markets.

As an ex-banker, I know that in the current economy, bankers may look more closely at carriers doing business with automotive shippers, and some carriers may face liquidity issues due to tightening credit. As a result of that and other factors, we may see consolidation in our industry in 2009 like we’ve never seen before. Express-1 is well positioned to take on the challenges of 2009, and we expect to emerge stronger than ever when the economy rebounds.  
www.Express-1.com


Ben Bauman
President, Bolt Express

2008 was a challenging year anyway you slice it...we work extra hard to obtain the numbers that we budgeted for the year. Overall Bolt Express experienced a very solid year, however, we did feel a softening in November and December. The first ten months we surpassed our revenue goals and even with the softening, we were still very happy with the year-end results.
 
Our drivers also experienced a very difficult year with the issues of fuel cost, hours-of-service rules, credit issues for new truck purchases and balancing their dead-head. Bolt focused this past year on help the drivers with each of these issues and plans on rolling out some new, very creative, tools to assist the drivers in 2009.
 
2008 was a year of expansion for Bolt Express. We opened Bolt Express Dedicated Truckload operation and expanded our Bolt Logistics operations to include Truckload, LTL, Airfreight and Specialized services. Also in 2008 we opened a domestic Mexico company called Bolt Logistics, s.v. de c.a. which is focused on intra-Mexico services.
 
In 2009 we will be focusing on recruiting the following: Dedicated Truckload will be recruiting tractor teams for dedicated truckload lanes. Our Expedited service will be recruiting tractors, straight trucks and Sprinters. Even with the down turn in the economy, Bolt is still projecting growth for all companies in 2009.  
 
Bolt Express has won the prestigious GPS award for "Highest Revenue Growth Year-over-Year" for two out of the last three years it has been presented. This award considers over 400 carriers in the Expedited market in US and Canada. We hope to win this award again for 2008, as we are a contender for the award to be presented at the GPS Conference in Las Vegas on January 18th, 2009
 
For more information about joining the Bolt Express team, go to www.bolt-express.com.