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Soaring Price of Diesle is Idling More Big Rigs

Vicki Vaughan - Express-News Business Writer

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"Basically, I'm going broke," Godard said. "Fuel prices have pretty much run me out of business. I used to enjoy driving, but when a run pays a grand and you pay $700 for diesel, you've only made $300 on that run and one tire can cost $400.

"I lost more money last year than I ever did," he said.

Godard and fellow owner-operators have been slammed by diesel fuel prices that reached record highs in many parts of the country on Friday. In San Antonio, diesel fuel soared to a new high of $3.64 a gallon, up 44 percent in a year's time, according to AAA.

The picture is much the same in the rest of the nation, with diesel prices setting records in many cities. California's per-gallon average for diesel is closing in on $4 and prices in the upper Midwest are nearing $3.80 a gallon.

Diesel fuel historically has been less expensive than gasoline, but no more. Diesel prices are soaring for the same reasons the cost of gasoline is way up: the cost of crude oil — which traded above a record $106 a barrel Friday — and growing demand.

"Globally, especially in Europe, diesel is the transportation fuel of choice," said Ted Harper, an energy analyst with Frost Bank in Houston. In addition, diesel is a distillate, as is heating oil, which is in demand in wintertime. "In wintertime, distillates go up in price and diesel goes along with the rest," Harper said.

(Associated Press file photo)

Trucks like this might get 5.5 miles per gallon, and many truckers say they can't pay their bills anymore.

Self-employed drivers say nobody is paying attention to their plight.

"Nobody's listening," said Godard, the independent trucker from Wisconsin who makes runs through Texas.

In a Jan. 30 letter to President Bush, the Owner-Operator Independent Drivers Association said small-business truckers (those with six or fewer rigs) have been "devastated" by rising fuel prices. The association is asking the Bush administration to take several measures to alleviate tight domestic fuel markets, including ceasing to divert oil to the Strategic Petroleum Reserve.

Every time the price of fuel jumped by 5 cents a gallon, a trucker's annual costs increased by about $1,000, the association wrote. The escalating price of diesel today "is an enormous burden on the small-business trucker whose average annual income is $37,000 to $40,000."

Godard said he was coping with record-high diesel prices while making an $1,800-a-month truck-and-trailer payment and a monthly insurance payment of almost $700.

"My girlfriend has had to get two jobs to help out," said Godard, 41. "I'm going to end up filing bankruptcy. I'm calling the finance company and telling them to pick up the truck."

Godard's friends are in the same fix, he said. "Some of them aren't coming home because repossession companies are looking for their trucks," he said.

Independent operator Michael Kordi, owner of MLK Transport in Rockwall, east of Dallas, said rising diesel prices "are really making it a challenge to make a profit and move forward." He is trying to raise his rates to keep up with fuel prices, but that's left him with less work.

"The competition is really fierce, especially in Texas," he said, because there are more trucks than loads to be hauled.

Broker Marie Martinez said she knows all about competition among independent haulers these days, saying some are agreeing to rock-bottom rates just to keep going. "Some are telling me they have enough money to make the next two payments on their truck, and after that they don't know," she said.

Martinez, who explained that her job is to find loads for truckers and truckers for loads, has been in the business 15 years, working out of her house near La Vernia.

"It has been a wonderful way to make a living," she said. But now she fears her career could end prematurely. She's tried to alert politicians and elected officials to the plight of truckers, without success.

"I've got four or five truckers a week who are saying they're just going to park their trucks. It's so depressing that some days you could just sit down and cry."

Martinez did cry, Godard said, when he called her recently and told her he was parking his truck.

Godard had named his one-rig company Samantha's Freight Lines after his 5-year-old daughter. "She was real proud of that," he said, "but there won't be trucks anymore with her name."


vvaughan@express-news.net


Online at: http://www.mysanantonio.com/business/stories/MYSA030808.01D.Truckers.2d45047.html