[the48thronin]

No I am not going to quote any news... simply start a thread based on the premise that as of midnight last night fuel costs in New York at TCA truck stops rose from the 370s to the 399 range. at this point some ( I estimate 1/2 of small fleets one owner trucking companies etc) will start to run at a loss. If this continues for 2 weeks, trucking company failures will begin to cascade again leaving the market to the big boys who can report millions of dollar losses for the quarter but continue to exist.

The answer is fuel surcharges which I can raise instantly, but most small fleets cannot. Most large fleets have contracts that will need to run their course before cost increases can get included. Look out below.. here goes the second wave ( actually including 2001 the third) of transportation failures.)

Just as an example loads are canceling all over the country as shippers face fuel surcharges that are now 20 cents a mile up from 3 months ago. ( including the one I was supposd to load Friday sigh)

[Plantagenet]

Treasury Secretary Timothy Geithner gave a speech just yesterday saying that the US economy is now in great shape and the gas price increases won't be problem for the economy.

[vision-master]

Gas just went up from $3.29 to $3.49 today - should be @ $4 sooon, Oh this doom is so much fun to watch. All those idoits who drive big SUV's and 4X4's are gonna be using that credit card to survive pretty soon.

[vision-master]

Off another 4um...

Check this shit out.
i drove my mom to the doctor and we passed the Hess station the price for a gallon was $3.49 for regular.

1-1/2 hrs later on our way home the sign said $ 3.57..

WTF in just those 90 minutes they raised the price !!! ...

[dolanbaker]

Panic over, Brent is back down to only $110.

[buddylee]

From the same guy who was predicting the end of JIT delivery and the collapse of grocery stores everywhere 2 years ago. I'll believe it when I see it.

[vision-master]

What do you know about the trucking industry?

[Puchica]

3.25 here in Central Pennsylvanial; this means I cancel my trip to Harrisburg to the Flower Show. Necessities only.

[the48thronin]

The last "spike" left behind results including the banishment of the number of different items stocked in Walmart by 50%, that change doubled the flexibility of their JIT system at the cost of fewer products available for sale in each store. The change in JIT structures of the surviving big box stores, and the failure of several distribution networks proved the necessity for loosening JIT schedules and gaining that flexibility.

Trucking was saved from imminent collapse when the collapsing economy reduced the price of fuel so precipitously that survivors were able to creep along remaining in business. Government stimulus and green grants helped many of the bigger carriers to pretend to make smaller losses. After a year profits were wrung from every book keeping trick in the book. A chorus of "the recovery is at hand has disguised the slowed failure of transportation infrastructures. Make no mistake, kicking the can has almost finished, the end of the road you can kick it down might be in sight.

Union give backs saved for now the giant LTL carrier that invested too many marbles in the China to store drop shipment idea. But businesses representing the major manufacturing systems from Auto to home appliance have continued to trickle off shore in search of greater shares of the "developing Asia market". Meanwhile that LTL carrier continues to slowly fail. In a reversal of norm, the advanced age of much of their equiptment has actually helped them aviod the low fuel mileage and high mantanence issues other carriers are dealing with.

Back here in the USA the green mandates have been either put on hold by states that ordered them, ( as their fuel guzzling aspects and defective technology became apparent), subsidized by grants ( in the name of emission free or hybrid establishment), or subsidized by a can kicking 100 percent depreciation in one year schemes.

None of the underlying problems have actually been successfully addressed. Transportation taxes are still being diverted from freight carrying systems to exotic rail passenger projects, museums, or any other pet project of dubious value that cannot attract private financing. The ankles of the economic colossus are still shattered, the tipping slowed with the decrease in fuel costs, however those ankles are still shattered.
80% of all food and end user freight is still dependent on small ( less than 6 owned) fleets for transportation, in fact many of the bigger fleets survived only by adopting a cost sharing "fleece purchase" scheme putting the burden on ever smaller less able to stand a shock "independent" contractors.

The push of higher cost SPIKES will re-accelerate that tipping. Debt service for smaller operators may well be the fulcrum as "independent" ( yeah right) contractors face the choices. The choices facing many are how to pay for operating cost increases without increased revenue, send money home so the wife and kids can eat ( yes that cost is also growing), or pay your quarterlies to the ravenous overlords. The primary debt for the tractor lease will be extracted from earnings before the contractor ever sees them by the nature of the slave collar relationship with their debtor and masters at the carrier they lease to and get revenue from. The failure rate from these "fleece purchases is high by design, but with this price spike it may reach cataclysmic proportions quickly. Most of the "fleece purchase" operators I talk to are taking home "no pay due" already 3 out of 4 weeks at a time due to maintenance factors. Their fingers are clinging to the rock wall as they hang from the cliff, but the family at home is beyond struggling and the Tax man is forgotten for the moment. That situation has one outcome unless costs regress or revenue goes up.

The largest JIT carrier in the USA brags that it owns not one truck. They purchased many smaller and mid sized carriers at the distress sales caused by the last spike. That tactic has a limited ability to help them replace the failure rates they are about to experience. Those carriers they purchased that owned trucks found themselves forced into "fleece purchase schemes or to layoffs of drivers as their trucks were sold.

A second problem related to the 05 to 07 emissions technology failures, and the 08 and 09 motor defects caused by emissions reduction technology, and the more rapid than usual transfer of that defective equipment from fleet owners to "independent contractors" would be too technical to fully include, but I will add the statement that unlike previous failure rates in the secondary small truck sector, the failure of that equipment is preordained to make failure rates in that sector of the industry that actually delivers the majority of food from farm/cooler/packer to DC extremely high as the defects cause catastrophic failures to those people unable to handle that financial strain the most. There is a reason Caterpillar has withdrawn from the class 8 motor market. That reason and related issues might in fact be the tipping point as it matures as those trucks reach the 500k mile era where fleets usually dump trucks off into the used fleets. Many of those trucks are available now with 300 to 350k miles of use because they original carrier purchaser knows the math on failure of those drive trains. 2010 motors are in fact already becoming known for their own systemic failures.

[vision-master]

I heard those 'older' Caterpillar engines are not sold in the USA anymore, they have gone to China now. Their replacement's (thanks to the EPA) are junk from what I've been hearing.

[the48thronin]

I heard those 'older' Caterpillar engines are not sold in the USA anymore, they have gone to China now. Their replacement's (thanks to the EPA) are junk from what I've been hearing.

Caterpillar experimented for 4 years trying to manufacture a motor for class 8 trucks that met the new emissions standards, and failed to find any way to do that in a motor that could last the average 10 years before major overhaul. They settled in07, 08, and 09 on a two turbo charged design that has had catastrophic maintenance problems and decided to sell their factory when PACAR ( the owners of Peterbilt and kenworth) whose trucks were the last remaining ones using Caterpillar started construction of their own motor plant in Columbus Mississippi. That plant opened recently building a copy of their European designed motor for USA markets. My wife carried away some of the equipment last week after their "show" for the American and Brazilian dealers of the new products that are now coming on line.

[Arthur75]

Don't understand the title of this thread

[ColossalContrarian]

Don't understand the title of this thread

Then you probably should be visiting this site -> Disney.com instead.

The title requires one to understand the ramifications of energy cost on the economy. It's actually pretty simple for *most* people.

[Beery]

Treasury Secretary Timothy Geithner gave a speech just yesterday saying that the US economy is now in great shape and the gas price increases won't be problem for the economy.

What? Did you expect him to say: "Oh God, no! Panic! Sell everything! Run to the hills!"? He's the Treasury Secretary for goodness sake.

[Arthur75]

Then you probably should be visiting this site -> Disney.com instead.

The title requires one to understand the ramifications of energy cost on the economy. It's actually pretty simple for *most* people.

It was a syntax/language remark more than anyhting, as to fuel/energy cost, the US keeping its ridiculous tax level on fossile fuel, just show what criminals they are, towards themselves primarily.

[dolanbaker]

Don't understand the title of this thread

Then you probably should be visiting this site -> Disney.com instead.

The title requires one to understand the ramifications of energy cost on the economy. It's actually pretty simple for *most* people.

The title is meaningless if English isn't your first language, plus it's grammatically incorrect!

[AdTheNad]

Don't understand the title of this thread

Then you probably should be visiting this site -> Disney.com instead.

The title requires one to understand the ramifications of energy cost on the economy. It's actually pretty simple for *most* people.

I'm going to give you the benefit of the doubt and assume it was just something lost in translation. It just means that with fuel shooting up in price, people in the economy (everyone) should watch out for problems since everything is interconnected.

[the48thronin]

Don't understand the title of this thread

Then you probably should be visiting this site -> Disney.com instead.

The title requires one to understand the ramifications of energy cost on the economy. It's actually pretty simple for *most* people.

I'm going to give you the benefit of the doubt and assume it was just something lost in translation. It just means that with fuel shooting up in price, people in the economy (everyone) should watch out for problems since everything is interconnected.

Thank you I guess the americanism was lost to those not knowing it! Your transliteration is correct!

Kinda like " Hey watch this" means something to a combat engineer that ordinary people miss...SIGH,

[the48thronin]

Treasury Secretary Timothy Geithner gave a speech just yesterday saying that the US economy is now in great shape and the gas price increases won't be problem for the economy.

What? Did you expect him to say: "Oh God, no! Panic! Sell everything! Run to the hills!"? He's the Treasury Secretary for goodness sake.

HMMM how about some HONESTY maybe a discussion of the real problems and difficulties.. OH wait.. He's the treasury Secretary, We mustn't ask anyone in government to start being honest with the public, the shock would be too great!

Unfortunately unless the government realizes the only way to address those difficulties is to drop this sham recovery and honestly start discussing the coming changes and hardships nothing will come but the candle light vigils at courthouses as citizens begin to demand the dissolution of the slave master/corporative fascist state. The middle east probably is a symptomatic vision of the future of the western world, would it be better to emulate Egypt or Libya?