Why are there murmuring of a strike? Owner drivers are in an unprofitable Capital Intensive business. Refrigerated Transport: Driver Shortage limits carrier capacity
Another approach to reduce the driver shortage is to get more owner-operators. However, the number of owner-operators has been shrinking.
“I don't see anything that is going to change that,” Albrecht said. “The reason is simple economics. Owner-operators at fleets that pay per mile are generally making 88-91 cents per mile. The cost per mile for fleets is about $1.30. Even with fuel surcharges of 15-20 cents per mile, how can owner-operators make it at $1.10 per mile?
Diesel is at record levels (a 66% increase versus 53% for gas over the last 2 years) and the forecast is for Distillates (the group of fuels Diesel is part of, along with Heating Oil and Jet Fuel) to rise about 30% this Winter...assuming there are no more supply disruptionsEIA:Short Term Energy Outlook Sept 7, 2005 In addition the industry is hurting from a 3-10% loss in fuel economy due to the EPA regulations that took effect in October 2002.
I still do not believe we will see a massive strike (the vast majority of trucks in the market are owned by large nonunion carriers), but small work actions will be possible as the market gets tougher,
Even if truckers do not strike, the destruction of Truck Supply due to small operators failing may tighten the freight market further.
Truck Repossessions increased by 45% the first Quarter this year over the same period in 2004
And a 38% increase year over year in the 2nd Quarter this year.
And this is in an industry already shrunk by more than a decade of reduced margins followed by a record wave of bankruptcies in 2001-2002 link.