Heartland Express, Schneider, and the U.S. Truckload Market: Drivers’ Impact on OR

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Why don't you do relays? Why can't one trucker only transport loads within a certain maximum radius from his home? Then he would just hand over the trailer to another trucker for the next leg etc.

In truckload, the prices are so low that you can't afford to have relay points. Every relay point would require terminal land rent somewhere, and you'd need to rent yard space. The timing of arrivals is complicated. Here in South Texas, we do a lot of business, but Ryder does a lot with Tesla. Tesla had most of their manufacturing in California and wanted team service. Ryder had a relay service going. They would leave Laredo, go to a little town called Fort Stockton, and another driver would pick it up from there and continue. The issue is that the timing has to be perfect for it to work properly. If there's a flat tire, you have a driver waiting, doing nothing while repairs are made. By the time the truck arrives, some of the driver's hours have expired because they've been on the clock. Relays work on paper but not in reality because there are many factors you can't control. You don't control traffic, weather, or mechanical issues. Just like in Europe, if you're going to Barcelona and there's an accident, it could delay you by two hours. Your schedule is thrown off, and the person waiting for you at the border between France and Spain is wasting time and money. You didn't generate any revenue because you planned on a perfect relay, but things happened in between.

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As a trucking company, you were set up to send your truck driver out for a month before returning home. Now, you're saying sometimes they get back home every week. How do you manage this internally? What changed operationally for the full truckload carriers to enable this?

Full truckload carriers started focusing on shorter hauls. They stopped considering longer hauls or converted them to rail. Previously, you never looked at short distances. Nowadays, you have carriers specializing ins routes like Houston to Laredo, which is 300 miles. That's not much of a day. Dallas to Laredo is 420 miles. You might think, "I could have done 200 more miles for more productivity." But if you do that, your driver never gets home, and you risk losing them. There's a balance between keeping drivers happy by getting them home more often, every other day or every third day, and keeping trucks productive. So, you find routes that make more sense, like triangular routes from here to Dallas, Dallas to Houston, back to Laredo. It takes two days, so every other day, you're home.

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Yes, that would be local. But how would you deliver from your location to Chicago, the 1,350 miles, if you're focusing on shorter hauls?

I would use a local driver in Laredo to pick up the cargo, load it onto the rail to Chicago, and then use a Chicago local driver to pick it up from the rail and deliver it to Indianapolis and back. My local driver in Laredo is happy because he's doing local work and is home every night. My Chicago driver is also happy because he's home every night in Chicago. Did that make me more money? No, it didn't. There's a lot more expense now. I've got two employees instead of one for a three-day run. My line haul is a lot less because I used the rail. But I've got two tractor expenses, one here and one there. It's a lot of financial finagling to make it work. Day cabs are not as costly as sleepers, but they're still expensive.

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