Freewheelin' on XM Radio, with Women in Trucking

Photo by Tom Saunders, Virginia Department of Transportation

I was honored to join Ellen Voie and Marge Bailey of Women in Trucking as a guest speaker this morning on the Freewheelin' radio show. The show airs live on the Sirius XM Road Dog channel at 11 AM weekdays, with hosts Chris and Meredith. I had a chance to discuss one of my favorite topics: the effect of extreme weather on truckload rates.

If you subscribe to Sirius XM, check out the show. When you tune in, you can also catch DAT's own Don Thornton, a regular weekly guest on the Road Dog channel on Wednesday afternoons. Don discusses truckload trends on Landline Now, with host Terry Scruton.

On my radio segment, I talked a bit about one highly trafficked van lane: Chicago to Dallas. Add the back haul, and that one round trip illustrates most the trends I've been following this winter.

Road conditions in both Chicago and Dallas were absolutely awful in the first two weeks of February. Ice and snow covered the roads, a rare event in Dallas, while Chicago experienced all that plus fog and tornadoes. This week, Chicago is expecting more ice, record low temperatures, and a flood watch, too.

Head haul rates have been unusually high, but only in the southbound direction. This week, brokers were paying an average of $2.49 per mile on that lane, including fuel, according to DAT RateView. In February. That's a full 40¢ higher than the 365-day average and 19¢ above the average contract rate. Yes, brokers are paying more than the shippers pay their core carriers in February. Why? Because the weather is terrible, there is a backlog of freight, and the shippers, brokers and 3PLs just can't find enough trucks.

Back haul rates are dropping because rainy, windy weather in Dallas may be unpleasant, but it's not impeding traffic. Instead of a one-year average rate of $1.68 -- admittedly, not that great -- the northbound trip from Dallas to Chicago is paying $1.08. Don't despair.

There are alternatives. For one thing, Fort Worth typically pays better than Dallas. Today the difference is 11¢ per mile to Chicago. It's still not a great rate, but hey - it's another 100 bucks. Another option is to construct a TriHaul route: take a load from Dallas to Knoxville, TN for $1.48 per mile, deliver that and pick up another load from Knoxville to Chicago, at an average rate of $1.95. You will have to add a day to your transit time, but you'll make $3,560 in three days (almost $1,200 per day) instead of $1,020 in two days ($510 per day.) If you can spend the extra day on the road, this is a good trade-off -- especially if your overhead is low.

Keep the truck full, keep it moving. This winter, especially, that means you need to monitor the weather and road conditions very closely in all your lanes. If there's snow, don't go.



Peggy Dorf

Peggy joined DAT in 2008 as a writer and market analyst. She was instrumental in developing DAT Trendlines, and she writes extensively about the impact of economic trends on companies and individuals in transportation and logistics. Peggy is a Certified Transportation Broker with decades of experience in technology marketing and an MBA from the Wharton School.



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