Truck drivers have received a lot of media attention in recent weeks. During the COVID-19 pandemic, many people are realizing how essential drivers are to the nation’s economy, society’s way of life and even our survival. For a change, nice things are being said about truckers in the nontrucking media. Restaurants are finding ways to feed drivers whose trucks can’t fit in the drive-thru lanes, food trucks are serving truckers at rest areas, and ordinary people are giving free lunches to truckers.
However, drivers in one segment of the driving population say they are feeling decidedly unappreciated. Owner-operators, who depend largely upon loads they find on the spot market, are fed up with low freight rates.
Tensions came to a boiling point April 20 when an estimated 75 drivers staged a protest on Houston’s East Loop Freeway, a portion of Interstate 610. The drivers were cited for obstruction of traffic, and one was charged with inciting a riot.
A few days later, on April 24, a group of more than 100 drivers participated in a “slow roll” along several Los Angeles and San Bernardino County freeways. Several of these drivers were cited for obstruction of traffic. A similar protest took place in Phoenix.
More protests are scheduled for Friday, May 1, in the Los Angeles area, Chicago, Washington and elsewhere as disgruntled drivers call “mayday” on the traditional May Day.
A lot of owner-operators depend on loads found on the spot market for their business, since many aren’t large enough to swing their own contracts with customers. Most of those loads are posted by brokers, who arrange for the haul, track the shipment, bill the customer, pay the owner-operator and keep a percentage of the load revenue for their efforts.
After an initial rise in the first part of March, spot-market freight rates have steadily fallen. Part of the reason for this is simply supply and demand. Throughout 2018 and most of 2019, trucks sold at near-record levels, causing capacity — the supply of trucks available to haul loads — to increase dramatically. This increased supply of trucks pushed rates downward. Then, after the initial surge of products shipped as people locked down due to the COVID-19 pandemic, shipments declined. Shipments from overseas fell dramatically as China and other countries shut down manufacturing, followed by domestic manufacturers doing the same. The end result was a double whammy of fewer shipments (reduced demand) combined with higher capacity (increased supply).
Another cause of declining rates is the cost of diesel fuel. Spot rates usually include any fuel surcharge amounts, so when the cost of fuel drops, so do rates. The national average price for diesel fuel, reported on Monday, April 27, by the U.S. Energy Information Administration, was $2.44 per gallon. A year ago it was 73 cents higher.
As business owners and managers, most owner-operators understand how fluctuations in freight rates and price can impact their earning potential. However, they are frustrated that rates have dropped further than market forces dictate and that unscrupulous brokers are taking advantage by keeping too large a percentage of what the loads pay.
Rick Santiago said he has heard enough. The Carteret, New Jersey-based owner-operator is organizing May 1 protests in Chicago and Washington.
“Enough is enough,” he said in one of the numerous live videos he has posted on Facebook. The videos are wildly popular. One has more than 130,000 views and has been shared thousands of times on the social-media platform. And interest continues to grow.
“What I would like to push is for legislation to have these brokers regulated with a just percentage, a small percentage,” he said in an April 27 video. “There is no room for price gouging during a pandemic,” he said in another video the following day. “We understand that it’s supply and demand. We understand there’s less freight, but it doesn’t give any broker the right to monopolize the freight.”
OOIDA, the Owner Operator Independent Drivers Association, weighed in on April 28, with Media Spokesperson Norita Taylor telling The Trucker, “Brokers have always been adept at getting as much as possible from shippers and giving as little as possible to carriers, with or without a national crisis.”
That’s what brokers do. It can be a lucrative part of the trucking business — so much so that most larger carriers have opened a separate brokerage department of their own, at times with profits large enough to overcome a bad financial quarter by other segments of the company.
While there are several regulations that regulate broker conduct and brokers’ relationships with carriers, there are no regulations that specify how much money the broker can keep or how much they must pay an owner-operator.
“My only objective is to bring awareness and bring resolve, now, during a pandemic,” Santiago claimed in an April 28 video. “Our only objective is to be treated fair. In no way am I trying to say, ‘Eliminate brokers.’ Our problem is, during a pandemic, they have exposed themselves by price gouging.”
OOIDA’s Taylor noted, “Truckers are generous. They like helping in disasters, but they need to make money.”
Editor’s note: This story is the first installment of a three-part series. Check TheTrucker.com tomorrow for Part II about owner-operators’ issues and upcoming protests.
Photo Credit: Rebecca Doty from The Disrespected Trucker Facebook group of Crystal McIntosh and her husband’s truck as they head to Washington D.C. to take part in the mayday protest planned for May 1.
Cliff Abbott is an experienced commercial vehicle driver and owner-operator who still holds a CDL in his home state of Alabama. In nearly 40 years in trucking, he’s been an instructor and trainer and has managed safety and recruiting operations for several carriers. Having never lost his love of the road, Cliff has written a book and hundreds of songs and has been writing for The Trucker for more than a decade.
Since the recession it has gotten out of hand. I own a fleet of 20 trucks and have company drivers. I try to avoid taking brokered loads because… the only way they make money, is if I don’t.
Where is starting point for rally/protest in Washington on May 1. And also what time.
I don’t think truckers understand that customers set rates and if brokers don’t accept that rate, someone else will and once that rate is agreed to several times, the customer expects that rate regularly. Also, brokers have a tough job servicing customers. They have to cold call people, get information about their freight, scheduling, recruiting multiple carriers, and tracking and tracing every load. That takes a lot of time and effort, let alone, having to deal with several thousand other brokers competing for the same freight. It takes a lot to acquire a new customer and then compete with other brokers/ carriers to service that customer, when this happens, the main thing the customer starts looking for, is “how low can you get the rate?” If drivers had to acquire and service a customer as well as drive their truck, there would not be enough hours in a day….
Yes,truckers don’t understand))They have no idea what are they taking about)) But let me give you an example about what truckers “dont understand”… Load is $1250…Broker take $750 and driver gets $500 …That what we dont understand,you stupid brokers ass!!!
Thank you Benjamin Skots!
You are right right big Ben .
A lot of time brokers take way more than that
I know I’ve seen it
I won’t work for a broker ever again
That still doesn’t mean the broker should get half the cut, but they do don’t they? I’m happy I’m not a carrier anymore, if I try it again, I’ll be a local carrier to eliminate the ridiculous risks an otr liabilities.
BC this article is very true, “there are no regulations that specify how much money the broker can keep or how much they must pay an owner-operator.” This is the very sad truth.
You sound like a Liberal Democrat.
All they want is give me everything. What agency are you with so I will not haul any of your junk.
Yes but no where near the expenses we have. Nor all the regulations we have to put up with.
lol sure anonymous you really believe that? i have 50 units and a full service brokerage – customers set their contacted rates in OCT-DEC for the next year i haven’t had a single customer call me and ask me to reduce a rate on a dedicated lane since the pandemic started – the linehaul rate stays the same throughout the year with only the FSC changing according to the price of diesel – go sell your BS somewhere else
They said fuel is reduced, but what about other bills, truck payment,insurance,living expenses etc etc..they are not reduced…broker’s are big problem for as owner operator’s..
As a Driver you have No “Living Expenses”. You dont have a Real Job or Career. You are a “DRIVER”. Your home is technically your “TRUCK”.
My truck is my living expenses!!!! Do you know when it breaks down because of the motor the cost is over$30,000, the transmissions are just as much, oil changes monthly are at $350, fuel is at $2000-$3000 monthly, King pins$1800, shall I keep going!!!! I spent over $45,000 in repairs, $77,000 in fuel and so much more in expenses on our so called “HOME”!!!! So you brokers can live beyond your means while us owner operators struggle just to keep our homes working and on the road and you make your nice fat paycheck!!!!! You need to thank us rather than f**k us!!!!!!!
I’m a truck owner. I decided to stop my truck going on my. 5th week. When I go shopping at the supermarket everything is more expensive eggs,milk, bread etc; what that tells me is they are paying more for shipping. Brokers are charging more but we the driver that are risking there life are getting Payless.
I seen this coming since two years ago around October 2018 when we only had Gm Arlington project , I used to argue with drivers about trucking is going down due to the president trumps trade war , but every one is no way we are doing better then ever , they were like oh shit ur from MI that’s why you think is slow .
I was a broker 10 yrs. I could make 6 to 800.00 dollars in 4 hrs. I lived on the beach in aa condo overlooking the water.i had a new Corvette, new Ford explorer,and a 30,000 iron horse motorcycle. I had one customer everytime I moved his load I would make a 1,000 off the top in 10 to 15 min.as quick as I could send the rate confermation over and get it signed.
I went back to driving again 32 yrs driving, 10 yrs brokering. I wanted all you drivers to know, what you can really make. But the worst are these stay at home moms that have gotten into this broker business,I know one who makes 5 to 7,000 a week,and beleive me there is alot of women making a killing.
The rates have been in a downturn cycle since 2019–if you review news for the trucking industry you’ll note that thousands left the market after demand dropped precipitously, all last year. Then add the China trade war, resulting in a 25% decrease in the Los Angeles outbound market, just as the national market was beginning to lift–bringing rates WAY down on the traditionally high end of West Coast trips. Return trips into California are considered the “back-haul”, or lowest rates, coming into an area that pays high rates to haul loads out of. Volume on outbound loads coming in from China caused the higher outbound rates to disappear. Higher outbound rates normally balance the low rates into CA. It nearly cost us our business. We are a single truck carrier, running out of California–to comply with state regulations we must maintain newer carb-compliant equipment, pay higher taxes, licensing and insurance and ALWAYS have some of the highest fuel prices in the country. The cost of running as a commercial carrier is daunting and none of those costs stop if the truck is parked, waiting for good rates. This Covid-19 shutdown caused the huge decline in volume industry-wid, so brokers are actively seeking to offset their volume losses by taking an unfair percentage of the shippers’ fees while also facing competition from other brokers willing to undercut their contract prices with the customer. It is dog-eat-dog and the industry is “self-regulating”; all scratching for any toe hold to survive. The FACT is our country is unprepared to provide timely assistance to the 90% of small carriers and owner operators that make up the trucking industry. As an example, we applied for an emergency SBA loan as soon as they cleared the first funding for support and are being told it is still waiting in line to be considered–not even assigned to anyone to review and we are a week into funding on round 2 of assistance. I worry that govt is failing to notice the cliff edge–too many small carriers and owner operators may end up being forced out of the business, leaving the industry unable to meet demand if our country ever recovers.
So , the only way your going to change things is shut all the trucks down. 90% of americans can’t stand truckers or have no idea how the grocery stores get there food,and they dont care. You are just a jerk who is in there way going down the highway,shippers and receivers treat you worse than a dog and all you guys let them. I been in this business 45 yrs nothing going to change.shut the trucks down until nobody has nothing, then you will get there respect.But the big companies will not stand with you. You got a lady in ms champions who is head of the D o t and she does not know even know how to get in a truck, much less take care of what we need. We need someone like me in there representing us. So all you guys write Mr.trump and have him apoint me Hoot Gibson. Good luck drivers I just turned 65 and iam retiring.
Quit whining and crying about the cheap rates and crooked brokers and park your trucks.
Yep Sam, i sure hope that happens this time because NOW IS THE TIME!!!
It’s coming and you will see it. Your ass will be in trouble
Park the trucks everyone , till then no one will do anything.. between brokers and companies your not really hauling the load for no more then 50% , then where is the cost of operating, fuel and driver
Drivers need to take what is given to them, if you drivers refuse we will find other resources for our loads to be delivered.
Who or what? There are places that only trucks can get to, no train, no plane, and people won’t do it. I know several drivers who are not rolling and right now won’t roll because of wages from years, years, and years ago!
How come drivers were cited with obstruction of traffic but people standing in the roadway is ok to protest?
Those Hillbillies have no right to protest. They need to OBEY the law or the law will issue citations. Those trucks have no business blocking my right if way of TRAFFIC flow.
what its fear is fear. So tell me do you think that a $1 a mille
after diesel, repair that are expensive, insurance, dot, regulations, tolls, road expenses, tag, working over time ALL the time, all the risk that are in the road, not able to eat or take a shower sometimes, as animal in the road and much more that’s it’s fear. At the end its all about been united, that’s what we need because everyday we are more and more a necessity to move this country but instead we are treated disrespectfully and paid less than minimum wage.
I personally parked my tractor/trailer on 04/08/20 and keep declining loads offered by my dispatch company. The only reason is low rate. Owners/operators, my dear OTR brothers, please do the same and we can make them play our rules.
This protest will not be tolerated and will be severely delt with. All that protest, block, impede traffic shall loose their drivers License, fined bo less than $10K per VIOLATION. I have reported a number of Red Necks Blocking my right of Way of traffic. I have seen troopers pull these red necks over and issue VIOLATION tickets.
lot of drivers don’t know about fuel card discounts and more. Every body needs to know about this cause. I know one to 4 companies that do this they will charge u 2 to 4 dollars every time you use a fuel card or charge u 15 or less when u get a check for lumpers and also they will put lumpers towards your gross on every payroll show it has a cash advance. these r companies that u lease onto and I found out that they don’t charge at your major truck stops every time u use a fuel card. This is one thing all of us need to look into not just what brokers r doing. I would like to see why do other companies get a way bigger discount then a small business that uses the same fuel cards. I say if i get a load through a broker that has his on trucks i should be able to get the same discount as him. that’s where we as owner operators need to do something about this cause lot of companies pay fuel from 1.18 to 1.02 a gallon when fuel is 2.399 to 2.609 i shut my truck down because no money was there last year
I know a couple of companies that’s not honest about everything. I worked for a couple of companies that will say they take care of IFTA fuel taxes. But the issue i have is if he tells me. I’m the only one that gets the fuel discount and he’s not honest with other owners what else is he hiding. I like to work for a company that is honest with everyone. I still haven’t got my last check cause he wants to tell me i’m late on loads and i know for a fact that he is a liar about everything. I say all trucking companies need to be looked at on everything. I say all Brokers and trucking companies need to be looked at to.
NO carrier should take a load for less than $3 per mile. If we keep taking cheap loads, the brokers will keep doing the same. Many times, I have hear the brokers say “other carriers are taking it for this amount”