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Forum: REORGANIZING THE INDUSTRY
Posted Thu, Mar 07 2019 04:40 PM CST 3 Likes 1 Dislike
JERRY ASHLEY
AGRA-LOGISTICS
Manteno, IL

Posts: 24

Hello Friends. As a couple of you know, I had a stroke, followed by a heart attack, which took the wind out of my sales and hampered my desire to come out of retirement and open a new trucking company. That being said, I have continued to keep up with most aspects of the transportation industry, including following the descussions/debates on this site in regards to dry bulk hauling. (Maybe I have too much time on my hands) With everything costing 3 to 4 times more for us than it did prior to de-regulation, and rates being low for decades, something needs to change.

HOS? As I did against DEREGULATION years ago, I have been fighting for improvements to the present too restrictive HOS rules, the government has shoved down our throats, via letters to Martinez.

Rates? Sure, who wouldn't like to receive $3.50 per mile on all loads; or, for running loaded or empty. The majority of us on the trucking side know what the operationg costs are to run rigs. My suggestion is for the bulk industry to establish minimums on what rates should be and if everyone, O/O or company, would agree to this then the playing field would become more level. Nowhere in the Motor Carrier Act of 1980, or anywhere else, are there rules against companies and Owner/Operators, operating with revised basic standards like this. Setting minimums that shipppers, or brokers, would have to become familiar with, would help insure we can become more profitable and easily pay drivers a decent wage. This would keep shippers, or brokers, from coming up with ludicrus rates like offering $1.10 to $1.90 per mile, for example, for loads. And, yes, I am sure there are folks out there who run real cheap. However, I can never imagine running for a buck ten and then not finding anything in the delivery area to return home with and ending up actually running for a round trip rate of 55 cents per mile. Sheesh!!

Loaded Miles. At the present time, at the end of the winter duldrums, the national average for hauling freight is running $2.20 per mile. For refer loads the national average is $2.32. These are DAT figures. We all know the rates will increase substantially as the year goes on. And, or course, weight is not a contributing factor in this. It costs just as much to haul a load of lettuce from Arizona to Chicago weighing 32 thousand pounds as it does to haul one weighing 42 thousand pounds. Why should weight make any difference on what dry bulk haulers are paid? Industry standard? Sure! The agricultural industry. Not trucking's!!

In the dry bulk division of trucking, my suggestion would be a basic nationwide minimum of $2.20 per mile for live loads; or, $110 per hour for local, or anything not exceding 200 miles from a shipper, with a minimum of 3 hours for the service.

I would also suggest $1.65 per mile for dead head from your base of operations to the shipper; or, from the point of delivery to the next shippers location. Someone may ask, "Who chages deadhead?" Well, in the transportation industry, bus companies charge approximately 75% less than their live rate to pick up charter/tour groups for their service, to cover drivers expenses, fuel, etc. What is the difference between running a bus empty or running a truck empty??

Demurge charges are a plague on the whole trucking industry. I would suggest $80.00 per hour after the initial 2 hours at a shippers/receivers facility.

Delivery and pick-up rate. I would suggest a fee of $50.00 for each pick-up and delivery. I have never seen in writing the law/rule that states a driver/company must give a shipper/receiver two hours of your time in regards to picking up or delivering their freight/load. All I've ever heard is the explanation; "It's the industry standard!" Where did that ever come from? The idea of "giving" a shipper/receiver two hours of your time upon your arrival has always been a sore spot with me. These people are not "giving" you anything. And they are real quick to punish you financially if you are late with a load.

Of course, other things to concider in regards to a load, that need to be charged to a shipper/broker, are the extenuationg costs regarding wash outs, tolls, fuel surcharges that may arise, and weight tickets that insure the load may be transported legally.

I would do anything I could to help improve, or possibly re-invent, this industry. Of course, the elephant in the room would be those who don't realise the benefits of making improvements to help themselves and the whole industry. As usual, your comments for/against will be appreciated.

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Posted Fri, Mar 08 2019 10:10 AM CST 1 Like
DAVE WINTERS
DWT TRUCKING
CLEARWATER, MN

Posts: 561
Jerry I believe that we are very close to that happening right now. Recently the senate held a hearing where they heard testimony how shippers were unable to move product to market, the truck shortage has now paralyzed railroads and ocean carriers operations. In the testimony they pointed to numerous examples of the supply chain completely failing at every level, domestically and globally. I don't see the problem going away without a return to regulation of freight rates. Everyone is cherry picking customers at this point, just as the ATA predicted would happen when deregulation happened, there are now shippers who can't get trucks. If the infrastructure projects ever manage to get off the ground in Washington, they will be met with failure as there are not enough drivers in the market to move material, without compromising what is left of the supply chain. Changing HOS and giving drivers more time? Unlikely to be welcomed by today drivers who supported the ELD, as they don't want to work more hours, they want to work less and get paid for more. As for us older drivers? Well our health is deteriorating from the HOS we are forced to comply with, both mentally and physically, many drivers are on blood pressure and cholesterol medication long before the general public, and our life expectancy is 62 on average. REPLY
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Posted Fri, Mar 08 2019 10:11 AM CST 1 Like
ANDREW WENGER
AWTRANSPORTATIONLLC
Tampa, FL

Posts: 87
Dave your right on the money. The government wants us pre eld folks life expectancy to fall so we can sooner be replaced with a modern driver that has usb ports on the side of his head and his brain flashed with fmsca rules to the extent that the modern driver cant live a normal life REPLY
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Posted Fri, Mar 08 2019 12:43 PM CST
JERRY ASHLEY
AGRA-LOGISTICS
Manteno, IL

Posts: 24

Hi Dave. It's been awhile and it's nice hearing from you again. Yes, I agree with, and am aware of, most everything you said. I don't have a problem with the ELD replacing paper logs. Like many others, my biggest complaint, which I have written to Martinez about, is in regards to logging off duty during a mid shift lunch/dinner break for as long as it takes; or, for a physical problem, like a very severe headache that the driver feels may impare his ability to drive safely (couple hours in sleeper bearth), without it going against the 14 hour clock And the problem with inclement weather which, in the old days, used to allow a driver an additional 2 hours to complete, or get close to, the normal miles that would have been run.

I will admit I had not thought about the "new school" drivers who want to drive less and make more money, because that had never been my desire.

After my personal problems, I never became a full member here; so, I can not access the information on what the average loads are actually paying, depending on the commodities or lanes run. Thank you for updating me on the fact that, most of you anyway, seem to be earning somewhat decent rates. And, because of Deregulation I had refrained from using the term "published rates" in my original post, and just used the term for "suggested mimimal rates". On the other hand I feel it would be great if someone took the bull by the horns and did develop a program for this industry along those lines. And screw the government. As usual, they mucked everything up, as you stated.

And I still feel that hauling by the bushel, or by the ton, should not be considered with a rate. Distance, or charged hourly time, should be the only rates paid for, as in other divisions of transportation.

Thanks, Jerry

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Posted Sat, Mar 09 2019 08:40 PM CST 2 Likes
DONALD KEIFER
RUFFIAN ENTERPRISES
Des Moines, IA

Posts: 66
ok let me make sure I'm getting this right? there's a driver shortage but now u can't find one place to park after 5 pm during the week regardless of where I. the country u are hmmmm??? second thought is as a broker told me three weeks ago there is 1 load for ten trucks....so I ask this question where is this so called driver shortage... and if there is so much shipper to market shortage then why ain't store shelves going empty? am I missing something ? REPLY
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Posted Sun, Mar 10 2019 07:18 AM CST 1 Like
DAVE WINTERS
DWT TRUCKING
CLEARWATER, MN

Posts: 561
Originally Posted by: DONALD KEIFER
Quote: "ok let me make sure I'm getting this right? there's a driver shortage but now u can't find one place to park after 5 pm during the week regardless of where I. the country u are hmmmm??? second thought is as a broker told me three weeks ago there is 1 load for ten trucks....so I ask this question where is this so called driver shortage... and if there is so much shipper to market shortage then why ain't store shelves going empty? am I missing something ?"

That's definitely a fair question to ask, along with why the rates are so low if it's true. I would guess that speed of movement and constant flow of goods on a set schedule would be a better way to understand it. You have several modes of transportation all working together, Ocean carriers, river barges, airlines and railroads and trucks. A bottleneck anywhere will cause a chain reaction throughout the system. For example you complain about detention time at the grain elevator, well the elevator you are at is waiting for rail cars, because the railroads waiting for the capacity to open up somewhere down the line at another location that is dependent on trucks. Now the elevator you are at knows this is a problem, so they really don't need anymore product coming in until stuff starts moving, so they drop the rate down that they pay you, to try and cut back the line of trucks building up on their end. Now in some cases when this threatens deadlines and contracts, they will utilize the spot market and try to get stuff moving with a alternate plan, but there needs to be reserve capacity in the market for that to happen, and it needs to be economically feasable. When you look at how clogged up costal ports and rail yards are, it becomes apparent that revenue is being lost on a massive scale. Let's say you could have shipped a billion tons of goods today, well because of bottlenecks and delays we wind up only shipping 80% of that? The economy just lost a lot of money, the demand for the sale of product was there but the ability to deliver prevented it.
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Posted Sun, Mar 10 2019 01:11 PM CST
DONALD KEIFER
RUFFIAN ENTERPRISES
Des Moines, IA

Posts: 66
Originally Posted by: DAVE WINTERS
Quote: "That's definitely a fair question to ask, along with why the rates are so low if it's true. I would guess that speed of movement and constant flow of goods on a set schedule would be a better way to understand it. You have several modes of transportation all working together, Ocean carriers, river barges, airlines and railroads and trucks. A bottleneck anywhere will cause a chain reaction throughout the system. For example you complain about detention time at the grain elevator, well the elevator you are at is waiting for rail cars, because the railroads waiting for the capacity to open up somewhere down the line at another location that is dependent on trucks. Now the elevator you are at knows this is a problem, so they really don't need anymore product coming in until stuff starts moving, so they drop the rate down that they pay you, to try and cut back the line of trucks building up on their end. Now in some cases when this threatens deadlines and contracts, they will utilize the spot market and try to get stuff moving with a alternate plan, but there needs to be reserve capacity in the market for that to happen, and it needs to be economically feasable. When you look at how clogged up costal ports and rail yards are, it becomes apparent that revenue is being lost on a massive scale. Let's say you could have shipped a billion tons of goods today, well because of bottlenecks and delays we wind up only shipping 80% of that? The economy just lost a lot of money, the demand for the sale of product was there but the ability to deliver prevented it. "

well detention time is a completely different animal...while I for one try to stay out of elevators I can agree that it should be after 2 hours no questions asked 200$ per hour after that.... but that's my opinion.. . now with that said for the sake of all other points that still don't explain why the parking is shorter now then it ever has been except for the elds and why the store shelves are not going empty with this supposed truck driver shortage.....Monday thru Friday u can't buy a parking spot anywhere I. the country after 5 pm and worse one west or east coast
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Posted Sun, Mar 10 2019 01:11 PM CST
DONALD KEIFER
RUFFIAN ENTERPRISES
Des Moines, IA

Posts: 66
oh btw that still doesn't explain the one load to ten truck ratio right now either REPLY
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Posted Sun, Mar 10 2019 04:37 PM CST
DAVE WINTERS
DWT TRUCKING
CLEARWATER, MN

Posts: 561
Well in 2008 there was one load for ten trucks, so if your broker is telling you that today I would suggest you find a better broker, one who knows what he is doing. If what he is telling you is correct, 9 out of ten trucks at the truck stop are empty, look around the truck stop what do you see? Trucks don't stay in business by running empty. A truck shortage looks different to you than it does to Wall Street. Wall Street looks at lost sales on a global scale, you just look at the shelves at your local store. Obviously there is some truth to the driver shortage, or why else would Everyone be raising driver pay? Wallmart for example raised their starting pay for drivers from 82k to 90k this year. Shippers are screaming about freight rates, and their earnings reports seem to back up what their saying, many are publicly traded on the stock market, their data is public, so it's hard to dispute what they are saying. Does your broker make his data public? REPLY
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Posted Sun, Mar 10 2019 04:38 PM CST
DONALD KEIFER
RUFFIAN ENTERPRISES
Des Moines, IA

Posts: 66
ok then let's look at this from the other side of the coin.... not saying anything is right wrong or indifferent....if there was such a shortage then why are freight rates still down where they were in the 80s ... yes I will agree that everything slows down to a point but not like I've seen it this year.....keep in mind I work of load board can find plenty of freight for a end dump walking floor or a belt last month or 6 weeks freight rates have been down worse then normal...brokers act like ur breaking their arm for more money....dead head miles have gone way up.....ins cost of equipment is up where it shouldn't be....but is cost of doing business...like I said not saying g right wrong or indifferent but if there was such a shortage parking would be somewhat easier to find freight rates would be up where they should be and if and hopper freight wouldn't be so hard to come by on the coast just my two cents REPLY
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Posted Mon, Mar 11 2019 08:14 AM CST
DONALD KEIFER
RUFFIAN ENTERPRISES
Des Moines, IA

Posts: 66
and I think the one thing that no one is taking into account is the fact that minimum wage has gone up along with everything else REPLY
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Posted Mon, Mar 11 2019 08:14 AM CST
DAVE WINTERS
DWT TRUCKING
CLEARWATER, MN

Posts: 561
In 1935 Shippers could not find trucks, in the middle of the Great Depression, so FDR had to step in with the motor carrier act, in order to save the shippers. Well here we are today on the opposite end of the spectrum with the stock market setting new records, and shippers find themselves in the same position? Now something about that seems rather odd to me. Apperantly truckers suck at business, and brokers don't? Jerry I would be interested in hearing your thoughts on the Reed Bullwinkle act, and if you think we would see something similar down the road? REPLY
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Posted Mon, Mar 11 2019 08:14 AM CST 1 Like
DAVE WINTERS
DWT TRUCKING
CLEARWATER, MN

Posts: 561
Originally Posted by: DONALD KEIFER
Quote: "ok then let's look at this from the other side of the coin.... not saying anything is right wrong or indifferent....if there was such a shortage then why are freight rates still down where they were in the 80s ... yes I will agree that everything slows down to a point but not like I've seen it this year.....keep in mind I work of load board can find plenty of freight for a end dump walking floor or a belt last month or 6 weeks freight rates have been down worse then normal...brokers act like ur breaking their arm for more money....dead head miles have gone way up.....ins cost of equipment is up where it shouldn't be....but is cost of doing business...like I said not saying g right wrong or indifferent but if there was such a shortage parking would be somewhat easier to find freight rates would be up where they should be and if and hopper freight wouldn't be so hard to come by on the coast just my two cents"

If you depend on loadboards you are always going to struggle. They are where the leftovers wind up that nobody wanted. You need to develop contacts higher up the food chain, and that is something that only comes with time and experience, it takes years to learn the market, there are no shortcuts. Load boards are useful for determining what is moving, and what isn't. By the time a load winds up here it's low priority, it has been passed between brokers multiple times, the rate has been chopped up. Of course there are a few exceptions to this, during peak times of the year you can occasionally find something useful, like every year when everyone goes into hiding during the CVSA/ Nazi 72 hour crackdown and folks are struggling to find trucks to cover stuff.
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Posted Mon, Mar 11 2019 08:14 AM CST
DALE HERMANS
HERMANS FARM
Milbank, SD

Posts: 162
I don't personally have enough knowledge on the trucking industry to know if there really is a driver shortage or not, but I'm cool with throwing out an opinion that the lack of parking comes from a 9-5 schedule at all the loading and unloading facilities. Ever see a cattle pot searching for parking? Sale barns, feedlots and most packing plants are open 24/7 REPLY
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Posted Mon, Mar 11 2019 01:50 PM CST
DAVE WINTERS
DWT TRUCKING
CLEARWATER, MN

Posts: 561
Dale raises a good point about limited hours of operation at the pick up, or drop off point, but the reality is that's unlikely to change. I believe Change is coming not because us truckers want it to, but because Wall Street needs it to. Let's say farmer bob has 50 loads of beans to sell, the local elevator tell him if he can deliver all of them by Friday they will pay $20.00 a bushel, but after that the price drops to $12.00 a bushel. Well if farmer bob can't get enough trucks in time, and he only can get enough trucks to deliver 36 loads before the market drops at the end of Friday, he's going to loose money and blame it on a truck shortage. Well it works the same way on Wall Street on a much larger scale, a global economy is extremely volatile, and dependent on rapid movement of freight. Nobody cares about us truckers until they experience economic pain. Our infrastructure was never designed to work at lightning fast speed to meet the demands of a global economy, it was designed for a domestic economy. The congestion and bottlenecks around places like Chicago are only going to get worse, the railroads are land Locked in most major cities, making rail expansion impossible, the barge system can't figure out how to maintain the locks and dams without posing major disruptions. More trucks appear to be the answer, but it's a job none of us want anymore, so something will have to change to make it attractive. REPLY
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Posted Mon, Mar 11 2019 02:46 PM CST 1 Like
JERRY ASHLEY
AGRA-LOGISTICS
Manteno, IL

Posts: 24

Wow, Dave, did you task my memory! I had to refresh it. For those not familiar to the Reed-Bulwinkle Act, you might want to research it. This occured through the old ICC back in '48 and officially stated: 'That act allowed “rate bureaus” operating under ICC-approved agreements to set rates collectively, and immunized the activities of bureaus operating under an ICC-approved agreement from the antitrust laws. In the environment of pervasive regulation, almost all carriers belonged to a rate bureau. Most customers paid the undiscounted rates that the bureaus set for classes of goods and published for their member carriers. The bureaus also published adjustments to those rates (whether reductions or increases) that any member carrier might request. The bureaus calculated and published, for their member carriers, the amounts of any across-the-board increases or decreases to rates that should be applied to take into account changes in the carriers’ labor and fuel costs. All rates were subject to regulatory challenge'.

After the Motor Carrier Act of 1980, however, the scope of antitrust immunity for motor carrier rate bureaus was greatly reduced, and collectively agreed single-line rates were no longer generally immune from the antitrust laws. The main exception is the formulation of general rate increases.

These rules/laws were enacted for "consumer protection". Which consumer? The manufacturer who consumes grain to make cereal, or the end user who purchases products from a retailer?

General Rate Increases? We all know rates have been stagnant for years. Yes, freight and refridgerated load rates are increasing, finally, whether it's due to driver shortage or companies realising they need to make more to combat the rising costs of doing business. And those hauling aggricultural products, or dry bulk, should do the same.

Most of us have heard about manufacturing companies complaining about higher prices they must pay to have stuff shipped. Let's face it, they have been too used to having their stuff shipped cheaply over the years since de-regulation. And to whose expense?

In my original post I suggested finding a way to have everyone agree to a minimum standard rate to haul bulk products. Not a published, or "rate bureaus" type of operation, which would proably bring the government into play. And, in my opinion, we don't need anymore government intrusion.

As for parking problems at night, since the government has basically made drivers "9 to 5 ers", with their desire to have less rigs on the roads at night, they have created this bottle neck. Some truck stops may be able to increase the size of their lots; however, most can not.

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Posted Tue, Mar 12 2019 06:48 AM CST
DALE HERMANS
HERMANS FARM
Milbank, SD

Posts: 162
Well so far I really enjoy this thread. But I have a question hopefully someone smarter than me can answer.... obviously alot of people must be taking these low paying loads for this to continue. How are they doing it? I feel I have a modest rig. 40k in the tractor, 30k in the trailer. How are other people getting by with 1.20 loads? Or aren't they? Are there that many people getting in, going broke and getting out, and start the cycle over? REPLY
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Posted Tue, Mar 12 2019 10:25 AM CST
DAVE WINTERS
DWT TRUCKING
CLEARWATER, MN

Posts: 561
It's easy to see to see why Bernie sanders has taken a interest in truckers, and started going after their vote. There was a video on Facebook where he met with "independent contractors " working at the ports in LA, and after looking at the rates being paid, he seen a opertunity to recruit voters, the only way those guys made a paycheck was if they quit maintaining the truck, and even then still not even close to minimum wage. Low rates are the cancer that spawned the safety Nazi culture that now infects all of us. The FMCSA has been weaponized by the meggafleets, they care nothing about safety, which has been proven by the ELD scandal, their only interest is in serving their masters at the ATA, and promoting a constant exploitation of workers, using ELD's like cattle prods to force productivity out of workers, and denying them adiquit pay, as evidenced by the way they interfered with California's meal and rest break requirements, trampling all over states rights. They care nothing about public safety, or the needs of the shippers, if they had they would have advised congress on why the ELD was a bad idea, using the crash data that they already had from the meggafleets, and they would have informed congress how the real problem with safety was the low rates, that coerce drivers into driving tired, and prevent them from doing proper maintenance on their trucks. REPLY
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Posted Tue, Mar 12 2019 12:28 PM CST
DAVE WINTERS
DWT TRUCKING
CLEARWATER, MN

Posts: 561
Jerry something for everyone to think about, when insurance becomes a big enough issue, the little guys like us won't be able to exist, unless we lease onto a self insured carrier. In the last year 50% of the company's that write truck policies have exited the market, and given the major increase in violations and spike in crashes that the smaller carriers are now seeing since the ELD, it's a safe bet that we will see another wave exit the market in the near future. At some point this will happen, because it's driven by numbers. Large fleets don't use brokers the same way us small guys do, because they have the capacity to deal directly with shippers, and get a direct rate. Many of you brokers won't be needed if that happens, and you shippers will see a spike in prices with less competition in the market, Just like your health care. A return to government regulation of freight rates would be the only way to prevent that, because a gentlemans agreement between truckers would never be honored. Consider this when was the last time any of you shippers were able to convince the railroads to haul your freight at a back haul price? REPLY
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Posted Tue, Mar 12 2019 03:18 PM CST
JERRY ASHLEY
AGRA-LOGISTICS
Manteno, IL

Posts: 24

Back Haul!!. (Cheap freight) Dear God do I hate those words. Dale, Dave basically answered your concern. Sure, I ran for a buck a mile for a while. But, that was back in the mid to late '70's. And I had my first brand new tractor and was hauling containers between Chicago and Dundalk Marine in Baltimore. I made $725 per trip/$1,450 per round and completed two round trips per week. (With a little creative logging) Since everything costs 3 to 4 times as much as it did back then, you would think average mileage rates would be around 3 to 3.50 per mile today. I am sure that those making less than 2 bucks a loaded mile today, must be shorting themselves and their businesses somewhere. Whether it's wages,maintainance, repairs, replacement, or the combination of all. Divide their rate by half if they can not find a live load returning back near their home base.

If you are in business, you are there to make money. Not give your services away. The same goes for shippers and brokers. Most of the time the money is there for everyone to make a decent living. A driver/company hauling cheap is hurting themselves. Certainly not for the other guys. If a shipper/broker can find someone to haul stuff very cheap, that just adds to their profitability. Some drivers may feel that if they haul cheap, they may endure themselves to a shipper/broker. Hardly!! They will just laugh at you for being stupid; however, continue to USE your services because you do run cheap. That's the way of life! Whether you want to believe it or not. Of course, maybe some guys liked to be laughed at!!!!

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Posted Wed, Mar 13 2019 08:00 AM CST 1 Dislike
JERRY ASHLEY
AGRA-LOGISTICS
Manteno, IL

Posts: 24

Hi Dave. Your information concerning the insurance industry is fairly accurate, unfortunately. And I totally understand your statement of: "A return to government regulation of freight rates would be the only way to prevent that, because a gentlemans agreement between truckers would never be honored". As much as I have come to hate government intrusion in our lives, new published basic rates that are reasonable, not ourtlandish, would notify everyone, company/driver/shipper/receiver, as to what they may expect to earn/spend. Yes, rates should fluctuate upwards, depending on destination, commodity, freight availability at the other end, etc. The same as they do in the freight/refridgerated sections of transportation. But, customers will learn over time what to expect in their own area of operation.

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