Record prices at the pump may be putting a new kink at the very end of the RV industry’s supply chain and could prevent RV buyers from getting their new rigs.
RV transporters are an essential yet mostly unheralded segment of the RV manufacturing industry. In most cases, the folks who move new RVs from factories to dealerships are independent contractors working for larger dispatching firms that contract with manufacturers.
Typically, RV transporters sign up with the dispatching firms, agreeing to haul new RVs from Point A to Point B for a set “per mile” fee that usually rolls in the cost of fuel. When fuel prices jump significantly, transporters can sometimes negotiate for extra fuel surcharges. But the surcharges—if there are any—aren’t keeping up.
Some RV transporters are giving up
Transporters are now saying that current fuel costs have them operating at a loss, and many are either parking their trucks or thinking seriously about giving up.
“This is crazy,” said one transporter recently on an industry Facebook page. “Unless rates go north of $2.50 (per mile), we are hauling (RVs) for free.”
Social media sites intended to connect transporters are now filled with comments about parking transporting vehicles until fuel prices allow for a fair profit. Since most transporters own their own vehicles and are independent contractors, they cover their own expenses including insurance, fuel costs, maintenance, and depreciation, among others. The cost of an oil change for some large rig haulers can run more than $200.
“Profit?” asked one transporter on a social media chat board. “What about truck payments, trailer payments, insurance, maintenance, tires, food, license plates, all your compliance costs, dispatching percentage, and all the chains, binders, tarps, straps, and signs? I don’t see a profit at all.”
Fuel surcharges—intended to offset gradually rising costs—aren’t keeping pace with recent rapid price increases. If a fixed cost such as fuel increases substantially, it cuts directly into an RV transporter’s profits.
“Well, boys, as of today I have officially shut down my truck and I want to just wish those of y’all still running good luck and safe travels,” posted one RV transporter.
Many RV transporters who already have the proper licenses are now giving up the RV transport business and going to work for traditional over-the-road freight trucking companies desperately in search of drivers to move consumer goods from ports to stores.
Dealers caught in a bind, too
Josh Winters, host of the popular RV Nerd YouTube video series and an RV dealer at Bish’s RV in Coldwater, Michigan, said high fuel prices will likely continue to disrupt RV deliveries to dealers.
“I have heard that a few have basically parked for now until freight rates rise,” Winters said. “Some manufacturers are announcing things like 25-cent-per-mile increases, but the shipping companies pocket most of that and relay only fractions to their drivers. With fuel costs and wear and tear, many are simply refusing loads until a more reasonable and favorable climate finds them.”
If enough transporters decide to park their rigs and wait out high fuel prices it could severely curtail shipments to dealers and further delay delivery to buyers.
At least one transporter agreed with Winters.
“That fuel surcharge needs to come up at least a dollar,” said an RV transporter from Montana. “The (dispatching) company is getting a higher fuel surcharge (from manufacturers) that is not getting passed on.”
It’s even more difficult for transporters who can’t find a return load to haul back to their home base—which is usually near manufacturing plants in Northern Indiana. The cost of fuel for an “empty” return trip is borne by the drivers.
Many RV transporters who are parking their trucks, for now, are blaming the middleman in the transaction—the transport company that contracts with both drivers and manufacturers to haul new RVs.
“Any of you who don’t think your load broker didn’t tack on a big increase to the manufacturers and dealers since the fuel prices jumped are smoking something,” said one transporter on social media. “That increase that’s supposed to be passed on to you, the transporter, is going into their pockets. They aren’t buying your diesel, you are. It’s time to quit buying the boss a new car.”