Major Carrier Fuel Discounts

Topic 32073 | Page 2

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Glenbob's Comment
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My company has a graduated surcharge based on price per gallon built into contract(s). At one point in prehire indoc I remember being told the company fuel bill was approximately $4 million a day. Needless to say if you are spending that much you no doubt get a substantial discount. Just in the short time I’ve been with them fueling at assigned stops has become more stringent.

Prehire:

What Exactly Is A Pre-Hire Letter?

Pre-hire letters are acceptance letters from trucking companies to students, or even potential students, to verify placement. The trucking companies are saying in writing that the student, or potential student, appears to meet the company's minimum hiring requirements and is welcome to attend their orientation at the company’s expense once he or she graduates from truck driving school and has their CDL in hand.

We have an excellent article that will help you Understand The Pre-Hire Process.

A Pre-Hire Letter Is Not A Guarantee Of Employment

The people that receive a pre-hire letter are people who meet the company's minimum hiring requirements, but it is not an employment contract. It is an invitation to orientation, and the orientation itself is a prerequisite to employment.

During the orientation you will get a physical, drug screen, and background check done. These and other qualifications must be met before someone in orientation is officially hired.

Grumpy Old Man's Comment
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That was my thought as well.

Maybe a reduction of $1.60 off retail?

Grumpy Old Man's Comment
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Yes that is exactly it.

We have stops that are considered terminal stops, in other words our discount is such that we can fuel there any time.

Lately though we get daily discounts about some that are close together to use whichever one is cheaper for the day.

Yes they add a fuel surcharge on contract freight. Pricing is a bit complex so I just am giving you the bottom line.

Your company is probably being strict with assigned fuel stops because those are where they are getting their best discount.

Terminal:

A facility where trucking companies operate out of, or their "home base" if you will. A lot of major companies have multiple terminals around the country which usually consist of the main office building, a drop lot for trailers, and sometimes a repair shop and wash facilities.

HOS:

Hours Of Service

HOS refers to the logbook hours of service regulations.
Grumpy Old Man's Comment
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That may be part of it as well.

Primes is around $4.28 iat THAT exact location. And we usually get $2 off the pump price. In 2020, we were only paying 56 cents per gallon at Road Ranger in Marshall IL. Every prime lease op ran through there as much as possible.

Now... It is possible this is a lease op at a company where they pay for fuel but are guaranteed a certain amount in exchange for the company keeping the IFTA rebate and fuel surcharge. For example, Hirshbach does something like that... The lease op pays 99 cents per gallon.

PackRat's Comment
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Some contracts will be with a specific truck stop. "We agree to buy XXX gallons for the month of XXX for $$$, usually a greatly reduced price. This is a major reason companies are strict concerning fuel stop locations, and the gallon amount you are told to pump.

Fuel is the #2 largest expense, only exceeded by the initial purchase costs of the trucks and trailers.

BK's Comment
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What is the number 3 expense? Driver payroll?

PackRat's Comment
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What is the number 3 expense? Driver payroll?

Depending on the size of the outfit, yes. The other huge one is maintenance and upkeep.

Bush Country's Comment
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This is a photo of a ticket for fuel on the well site I am currently working on. We usually get four loads a day, so we are spending about $100k a day just for fuel. I am not sure how much it is marked up but it is the best I could come up with for the wholesale price of diesel. The dyed diesel is used in our frac pumps and is untaxed. The tax shown is on the clear diesel. We are getting this from a refinery in Big Spring, Texas which is only about 15 miles away. For comparison, the TA at Big Spring is selling diesel for $5.49 a gallon.

0548514001657963530.jpg

Bobcat_Bob's Comment
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I meant to reply to this last week but forgot.

I saw a sign for a intermodal company hiring O/Os and it said $1.50 per gallon through them.

Intermodal:

Transporting freight using two or more transportation modes. An example would be freight that is moved by truck from the shipper's dock to the rail yard, then placed on a train to the next rail yard, and finally returned to a truck for delivery to the receiving customer.

In trucking when you hear someone refer to an intermodal job they're normally talking about hauling shipping containers to and from the shipyards and railyards.

BK's Comment
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I meant to reply to this last week but forgot.

I saw a sign for a intermodal company hiring O/Os and it said $1.50 per gallon through them.

$ 1.50 per gallon must be a company subsidized price? Correct? Or not?

Intermodal:

Transporting freight using two or more transportation modes. An example would be freight that is moved by truck from the shipper's dock to the rail yard, then placed on a train to the next rail yard, and finally returned to a truck for delivery to the receiving customer.

In trucking when you hear someone refer to an intermodal job they're normally talking about hauling shipping containers to and from the shipyards and railyards.

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