How Low Diesel Fuel Prices Are Impacting the Business of Trucking
Lower Diesel Prices
Now that diesel fuel prices are beginning to slide downwards, consumers with diesel powered autos couldn't be happier. But the biggest consumers of diesel fuel are truck drivers who depend on it to get the job done. The truth of the matter is that, fuel prices are the single greatest expense when it comes to the trucking industry, and lower diesel fuel is always a welcome sign.
Obviously, lower prices at the pump result in a lower overall fuel costs, and that equates to lower surcharge fees. Less money spent at the pump means more money spent for better freight prices, better wages and potentially, for better benefits too. It's a win-win situation for carriers and suppliers.
It also has major benefits for trucking companies. With lower fuel prices, more businesses will rely on trucking to get their goods to market than other forms of transportation. This is especially true for an industry that has lost some of its business to rail freight. In fact, trucking companies are seeing an increase in transferring shipments from rail back to trucks for the first time in 5 years. Lower fuel surcharge prices are the major driving force for that shift, and that's good news for truckers and good news for the economy as well.
Plus, independents see a bonus on their revenue if fuel prices are high one month and then drop the next. Most carriers are compensated for fuel surcharges according to last months fuel prices, so they reap the benefits when fuel prices are high one month and drop the next month.
The bottom line is that lower diesel fuel prices affect everything in the trucking business, from lower fuel surcharges, to gaining more customers and giving contractors and independents a little extra cash in their pockets every month.
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