Caroline: [00:00:00] Welcome to This Week in Trucking, the podcast that tells you what you need to know about the trucking market for the week. Today, we’re talking about diesel prices, hot and cold freight markets, and trends in fraud in trucking. Hey, Gervere. How’s it going?

Gurvir: Going pretty well. What about you, Caroline? How’s Michigan?

Caroline: Michigan is good. Michigan is good. Is your dad out on the road this week?

Gurvir: No, he’s not. His truck’s been stuck in a repair shop. 

Caroline: For a while now, right? 

Gurvir: yeah, repair shop these days. They’re so busy. I feel like that’s a good business to get into. But no, jokes aside yeah, they just haven’t been able to get to him yet. And they keep saying that, we’re going to check up on it, but they’re just so busy.

No, he just chilling at home and stuck at home. Yeah. He’s getting tempted. He wants to get back on the road though. 

Caroline: Yeah, I feel for him. I also feel for the people who, he’s still in the business because he just, Really loves it. Not so much needing to support anybody anymore. And, you, kids are out of the house, it’s just for his [00:01:00] own enjoyment and personal fulfillment.

But shoot for somebody who is supporting a family, who’s trying to start a business, getting a truck in the shop for a couple of weeks, that’s rough. That’s a lot of lost revenue.

Gurvir: A hundred percent. As you said, yeah. If someone, they need to make that revenue number each week to bring something home they’re definitely getting affected and this is not a good situation for them.

Caroline: Yeah, definitely. So if you have had an experience of your truck being in the shop recently, comment below, tell us about it, and we’d love to hear more about it and share it on the channel for more people to, to from it.

Gurvir: Yeah, definitely. Always have like good repair shops and mechanics, so you’re not spending a lot of time sitting around. But what do we have this week, Caroline?

Caroline: What do you think is the on highway diesel fuel price, average fuel price across the country today? This week, let’s say.

Gurvir: this week? 3 73.

Caroline: Oh, close. 3.77, 3.768.

Caroline: we are actually [00:02:00] down from a week ago and down considerably from last year. So it looks like after four increases, the benchmark diesel price went down for the third week in a row. So that’s according to Freight Waves. We’ll link an article in the description about that. But yeah, fuel prices are still, are coming down for the third week. From the last couple of weeks. They’re down across the board. The only place that they are up is in the Gulf Coast and they’re not even up by a cent in the Gulf Coast. So things are looking pretty good for diesel prices. As we know, this is one of the biggest costs for an owner operator, obviously the biggest cost depending on what you’re paying for your truck and insurance. and definitely the biggest variable cost for owner operators for folks running fleets. Maybe that’s driver pay and fuel might be neck and neck, but fuel is the biggest cost to an owner operator. And these even changes in one cent, two cent, five cents, they make a difference.

Gurvir: Yeah. I think since July 15th, [00:03:00] we’re about 6 cents down 3.82 to 3.76. I think we’re going to keep hovering around these numbers 5 cents, 10 cents up or down. I think 2025. If we decide as a U S as a country that we’re going to drill more, you’re probably going to see those prices come down, but I think EIA the energy department does predict that next year energy prices will come down.

Let’s see. But I think this year, I think we’re going to continue to hover around these numbers.

Caroline: Potentially, too, as we transition to electric vehicles or other types of fuels, then the demand goes down for fossil fuels, the price goes down with that. 

Caroline: Let’s talk about the freight market. So I have our hot markets up here on Spotter. So I’m going to share my screen. You want to walk us through that?

Gurvir: Yeah, by the way I saw Colorado grand junction just jumped a hundred and 179%. Wow. That’s crazy. I’m sure we’ll discuss that, but overall freight market as expected. End of July, [00:04:00] we were. We didn’t knew we knew that it was going to come down, right? July 4th, all those things, holidays, a lot of freight getting moved and we saw rates go up but now we are seeing rates come down a little bit as expected, as anticipated.

So no shocker there. So let’s look at the national truckload index by freight waves. The national truckload index is down by 2 cents. So it’s down from 2.33 last week to 2.31 dollars per mile. That’s generally the rate per mile that you’re gonna see on average. It has climbed up, but just from last week it’s it has come down.

If you look at without fuel cost line haul only, it has also come down from 1.73  to 1.71, a 2 cent drop. And the spot rate went up. We were trending in the right direction. The difference between spot and contract was only 47 cents last week. Again, at some point we’re gonna actually cross that where spot market will become more favorable and better off than contract.

I think that’s probably [00:05:00] gonna happen later this year. But in just this week, it moved in the opposite direction. If you look at DAT spot loads are down about 1.4 percent from last week. Truck posts are down 1.9 percent from last week. Dry van rates are averaging 2.07. We were at 208 last week so we’re about, about 1 cent down.

Flatbed is at 2.49, about 2 cents down. From June and July reefer rates are hovering around 2.44. So essentially we’ve saw, we’ve seen rates drop in the spot market in the last two weeks of July as expected. But overall good news is that the market continues to get tight. I saw an article today, two articles actually on a Freightwaves, we had Werner and Lanstar both reporting that, hey, we’re getting closer and closer to the inflection point.

I think that’s going to happen sometimes in the next three to six months. Once that happens, I think spot rates are going to go up and that’s really good news for truckers out there. So it’s been a long two and a half years.

Caroline: Yeah, it’s been a long, slow bleed.

Gurvir: Yeah.

Caroline: Lost a lot of really good carriers. [00:06:00] to that too. I’s rough that we have to wait for people to exit the industry and wait for businesses to go out and leave the industry. I would rather see an injection of investment into the industry and have that be the reason that rates go up, but that’s the name of the game in business, right?

Gurvir: If people that have stuck around, I’m very sure they went through a lot of hardships. And by the way, everybody from factoring companies to trucking companies, to brokerages, it actually, it’s painful for everybody in the industry. Obviously truckers feel a lot more pain.

But but people that have stuck around, hopefully the, the next year to two years could be good. I’m not saying it’s going to go crazy like COVID. But look, at the end of the day, we all want to make a decent living. I think it’s just, they’re just normal. Decent, we’re all making good money and it’s not too crazy because that does invite a lot of problems when rates really go crazy.

Caroline: Yeah, definitely. We get way too many entrants into the market and then it’s hard to then equivalent. Yeah, it’s hard. It’s hard to even that out.

Gurvir: Do you want to go over the [00:07:00] hot states?

Caroline: Let’s do it. So you just mentioned Grand Junction, Colorado. I want to know what the heck happened in Grand Junction, Colorado. Because check this out. Yesterday it was nowhere near this. And now it’s by far the most profitable market for dry van. So this is wild numbers here. You can see the chart down here.

We’re using Spotter and we’re using their index, which is a measure of profitability in these markets. So it’s not necessarily rates but how much profit can be made per hour moving freight from these areas. This is just a crazy jump from yesterday at 3 p. m.

Gurvir: Yeah. And then you have a bunch of West Coast states and then you have some Midwest Evansville, Cedar Rapids, Iowa, Saginaw, Michigan. Definitely. Yeah. You still have some Midwest that’s hot but South is done now, right? Like at the South is turning blue again, that’s also anticipated at end of July as produce season is winding off, holidays are winding up and we’ll see a pickup [00:08:00] again I think closer to September.

Caroline: Yeah, so that’s what you’re seeing for Vans. Let’s look at Reefer. Reefer is similar. You’ve got a lot of hot markets out on the West Coast still. Fresno, Ontario, California, Grand Junction. Again, number one. It’s been up there though so this isn’t a big surprise to me, but Grand Junction, Colorado is very hot on the Reefer market right now.

And then you’ve got a lot of the Midwest, Illinois, Indiana, Kentucky Nebraska, Kansas even some parts of Texas and and other states here that I’m scrolling over right now that you can see.

Gurvir: What about for flatbed? How are we looking for flatbed?

Caroline: Same story as the, as two weeks ago, pretty much the southern Midwest and south. Getting into Texas, Louisiana, Mississippi is a hot market for flatbeds right now. It’s nice that they’re all in the same [00:09:00] region, right? If you can stick around this region, people who have flatbeds that live in this region are feeling really good right now because it’s easier if they’re all together, you can flip from one to the other.

Gurvir: Yeah. And flatbed does really well when the housing market does well, right? So right now, the housing market is not doing too good. There’s a lot of room for improvement and obviously flatbed struggles because of that. So there’s a pretty good correlation between the housing industry and flatbed.

So let’s see what the housing industry does. I think we’re all anticipating rate cuts towards september. 

I was just listening to feds’ press conference. The rates will stay the same. They’re not decreasing rates right now or they’re not reducing rates. That was expected. But but yeah, I think there, people are anticipating rate cuts, at least one this year. So hopefully all those things will move some economic [00:10:00] activity. And by the way, to highlight.

All of the rates are going up because of capacity leaving the industry. It’s not like we’ve seen a huge jump in a supply of loads.

Gurvir: And essentially this has not been a demand problem. It has been a supply problem. But if interest rates comes down later this year, could we see economic activity next year?

And that could mean even higher rates for truckers, right? Despite capacity leaving the space. A lot of unknown factors. It’s election year. Let’s see what happens. I think all good news though, by the way. 

Caroline: Yeah, don’t forget about the big infrastructure bill that was passed about a year ago.

A lot of that won’t be seen until probably 2025. And so that’s tricky because you don’t always know exactly what the impact of that is going to be. But I was just talking to Balaji Ige of Overdims.

She runs a platform where you can get quotes on how much your permits are going to cost to haul oversized freight. And we were talking about this because you can predict to a certain extent that we [00:11:00] are going to see a lot higher rates for flatbed and step decks, particularly for those oversized loads to improve, construction on bridges, roads, buildings.

There’s just a lot, there’s going to be an infusion of investment over the next year or so. Right now it’s just in the process of getting contracts and projects up and running, and then they’re going to need all those construction materials to build all that stuff and repair and maintain all that infrastructure.

Gurvir: Yeah. I’m pretty bullish on trucking for next year, 2025, but I think we’ll start seeing some stuff, activity end of 2024 from now until 2024, but I’m excited about next year. That’s some good news for truckers. Y

Caroline: Let’s talk about fraud in trucking. We talk about this a lot, right? Because Bobtail’s on the frontline of [combatting] a lot of fraud. We’re the ones that have to collect on invoices. So [00:12:00] anything on double brokering affects us a ton and we have to do a lot of research. We have to do a lot of due diligence with our customers and their customers to make sure that everybody’s going to get paid what they need to get paid.

And I was also talking about this in another conversation that I had that’s already up with Dale Prax. He’s a freight broker that I talked to about what he looks for in carriers, and particularly in newer carriers. He works with a lot of vans box trucks and cargo vans. So he’s working with new businesses all the time.

He’s saying it’s really a shame that because of this increase in fraud, it gets infinitely more difficult for a new carrier to come into the market and get loads. Because if you don’t have inspections, if you don’t have history with that broker enough, then you’re not going to get chosen for those lanes.

And so I was looking at a article on overdrive. This was talking about how this freight fraud causes enormous [00:13:00] financial losses for everybody, particularly for carriers. I think they run the most risk, but also for brokers, also forfactoring companies like ourselves. And so brokers are now, because we have such a loose market and they can be more selective, they’re often excluding those carriers for what some would say are pretty arbitrary reasons, like the lack of a roadside inspection.

So they gave an example of a carrier. Who had just gotten their authority in 2022, but had been working as an owner operator for years and had already amassed a bunch of really strong relationships with brokers. But some of the big ones were starting to reject them because they hadn’t had an inspection yet, even though it was the same driver that had been hauling loads for them for a decade. So this is really affecting people. And I wonder what your experience is on this, what you’ve heard from carriers about this issue.

Gurvir: it’s a big issue. I [00:14:00] want to give the people the why this is happening. So fraud is affecting brokers a lot. I think a few weeks back there is a company agility express out of Illinois. They’re holding 36 loads as hostage. I think the value of these loads are almost 5 million. So you can understand why brokers are being very careful, right?

There’s double brokering fraud going on. People are holding loads hostage, people are probably stealing loads as well. And that just makes it really difficult for the genuine and honest truckers out there, the real companies that are not, planning on committing fraud, just want to run their business.

It makes it really hard for them. So that’s really the reason is why this is happening and why brokers are saying you need an inspection or they’re being just very thorough in who they’re giving loads to. I would say you definitely want to get an inspection. And I know a couple of scale houses and DOT are not, doing any more voluntary inspections.

I know it’s tough, but I would just really try those ask your brokers at the end of the day. If somebody is not giving you loads, Hey, what can I do? I’m a legitimate carrier. What can I do? Do you need inspections from me? Do you need a selfie verification? Do you need me to take a picture outside of a shipper to [00:15:00] send you and give you confidence that it is me?

And also, stay away from any probably red flags you can you don’t get because of this, right? Don’t give your friends loads, don’t try to double broker loads, even if you’re trying to do it legitimately make sure everybody’s booking loads under their own MC and you just don’t want to be caught in those things because once a broker finds out that you’re double brokering and that sort of spreads out the new spreads out to the industry and they can listed on carrier 411 and other websites and then that really shuts you down from business.

So you want to be very careful. I think inspection is the only one of the top reasons that I’ve heard that you can literally just show like a lot of legitimacy to your business and I’m sure FMCSA is working on it and hopefully they solve this thing right. At the end of the day it’s very hard to know you know who’s good and who’s a bad actor

Caroline: Yeah, it’s really difficult. And now we’re seeing more fraudulent activity on the cyber cyber threat side. So we have seen a couple of reports of an FMCSA [00:16:00] Hacking phishing scam, where they’re sending emails that look like they’re from the FMCSA, but are actually phishing people and trying to get access to people’s computers.

What do you know about this? I know I got an email, I think you forwarded one to me from someone’s account that looked like a FMCSA email.

Gurvir: It was a customer of ours that accidentally clicked on it and filled out the information and shared it with us and you. First of all, FMCSA will not email you, right? Most of their communication is through mail. So this was a total bummer and they make it look so real. So you never want to whether it’s other types of fraud as well people can make it look like, Hey, your Wells Fargo account is asking for your login or bank of America.

But FMCSA, I think it’s requesting your driver’s license and all of these other things, not sure what they’re going to do with this information. And probably use it for identity theft and then some sort of fraud somewhere. But please don’t click on anything. You want to be very careful about links that you receive.

An easy thing is always check the URL. So this link came from, a URL. And if you just type that [00:17:00] in Google and you look it up, in the website search, that it doesn’t go anywhere. It actually does not go to FMCSA website. So that’s one quick and easy way to find out whether this is a legitimate or, a link or not, but I would say always stay away from links.

Don’t click on anything. Just make a phone call to Wells Fargo or FMCSA. And it just look, fraud is never going to go away. Okay. And we just have to all get better at recognizing it, get better at making sure we’re not just clicking random links.

And that would be my suggestion to everyone. Just make sure don’t click on any links and FMCSA will never send you an email.

Caroline: Yeah, it looks like this email, I’m looking at it now, looks like it came from safety@fmcsa.gov. That looks super official, right? Like

Dot gov, I didn’t even know that someone could a dot gov domain for their email. It says fmcsa.gov. The actual domain for [00:18:00] fmcsa is actually fmcsa.dot.gov. So if you were to get an email that looks like it’s from fmcsa, if it’s not from that domain, it’s probably a phishing scam. If it’s from fmcsa.dot.gov, call. Message them on their website. Look it up. Make sure that this is legitimate. Because this is scary stuff. We used to be able to just open our emails see, emails from legitimate government authorities and be able to answer them and not be afraid of this. But now we have to be on super high alert.

Gurvir: Totally. Yeah. I would be very careful of the links, right? Generally, emails that have links and they want you to click on it, unless you know it’s coming from a very trusted source, you want to be very careful. 

Caroline: Yeah, definitely.

Gurvir: Awesome

Caroline: All right. Gurvir. If anyone listening has [00:19:00] stories that they want to share, questions that they have, please comment on our videos or write to us at hello@bobtail.com. I am the person that goes through and reviews every single email that we get, and we’d love to hear from our listeners about what struggles you’re having, what challenges, what questions you have about running a trucking business or the trucking industry and freight market in general.

We’d love to answer them on the podcast. So thanks for joining me, and I hope everyone has a great day.

Gurvir: Everyone drive safe!