Editorial: The Spreading Pain of Rising Fuel Prices

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he frustration truckers feel over surging fuel costs began to spill over in recent days, with protests first on the West Coast and then in the East.

The dramatic events drew more attention to an issue that too often has been seen mainly as a problem of gasoline prices cutting into consumer wallets. Business goes on.

But the protests underscored what readers of these pages have long known — sharply rising fuel costs are a threat to trucking, to the industrial and retail sectors that depend on trucking and other transportation modes, and to an economic recovery that only recently moved out of a shaky phase.

While protests, such as one-day port shutdowns, gain public attention and disrupt business, less visible is the daily pressure on freight transportation of steady increases in fuel costs. Increasingly, we hear of fleets turning away business from shippers that won’t pay carriers enough in fuel surcharges. We hear of drivers parking their rigs as they wait for loads that will pay enough to give them a good wage after covering those growing fuel costs.

In recent weeks, some carriers that specialize in moving containers to and from ports have begun to impose fuel surcharges for the first time. Other fleets that had long charged such fees have had to raise them repeatedly this year. And still, many say, they have trouble keeping up because pump prices have risen so fast.

As haulers reject low-paying loads even as the economy heats up, trucking capacity tightens. At least one major railroad system, which also serves most western container ports, is clogged with freight and trying to dump more loads onto trucks, but the fuel cost increases complicate the intermodal handoff.

With many fleets pushing fuel cost hikes onto customers, factory purchasing managers say their direct costs have increased significantly.

Last week, the Federal Reserve avoided raising interest rates for now, but signaled that move would probably come soon. The Fed’s job is to head off inflation before inflation starts to feed on itself, and many months of sustained fuel cost increases have set the stage.

Fleet executives are watching to see whether fuel costs fray the system or sap the bottom line. They are mindful that the pain can grow more acute as the pass-along effects of trucking’s pump prices dampen first consumer spending and then demand for factory shipments.

This article appears in the May 10 print edition of Transport Topics. Subscribe today.

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