For the trucking industry, which consumed 39 billion of diesel in the US in 2016, such a steep decline in a major cost center should be good news. Such savings are particularly important now as the coronavirus brings the steepest declines to trucking volumes seen since 2009.
But one major sector of the trucking industry actually relies on high fuel prices to smooth out financially rocky times: less-than-truckload, or LTL, carriers.
All trucking companies charge their customers for the fuel that they spend. Because the price of gas varies wildly, and because a single trucking trip can rack up hundreds or thousands of dollars in fuel, the fuel surcharge is necessary to ensure that the trucking company can move goods profitably.
But when fuel prices hit unusual lows, as they have in 2020, that means the fuel surcharge dips.
A quirk on the LTL side means that those truckers can actually earn a small profit off of the fuel surcharge.
How it works
The typical trucking company will…