Trucking companies are covering more miles and using creative strategies to make up for a downturn in loads because of the decline in housing construction, says a Medford trucking company president.

Wheels of change

With the residential housing market in retreat, trucking companies such as Combined Transport find themselves on the offensive.

It takes more trucks covering more miles and some creative strategies to keep rolling.

"We're a flatbed carrier and we've been hit pretty hard by the downturn in housing starts," says Mike Card, president of Combined Transport on Crater Lake Highway in Medford. "We haul glass, lumber, steel and stuff like that — all the things that have to do with houses — and our business has dropped considerably. With the lumber loads reduced, competition has increased and when that happens, price becomes an issue."

Even though housing starts have declined 24 percent for the 12-month period ending in May, Combined has added both to its own fleet and owner-operated rigs, giving it 362 rigs at its command, compared to 329 a year ago.

Card says the company looked for different commodities to deliver. "We've done heavy-haul and oversized loads in the past. We've done a lot in energy business loads lately."

That means delivering windmills to farms on the Columbia Gorge, Colorado and Iowa.

"There are 50 ethanol plants in production right now, including one in Clatskanie, and we're hauling quite a bit of material for that," Card says.

The second element is adding miles, extending trips farther across the fruited plain.

"Construction in the Pacific Northwest and California has been hit pretty hard," he says. "We already go to 48 states and Canada, but we're going longer distances, because places like Atlanta, Salt Lake City and Las Vegas are still pretty strong."

Through May 31, Combined Transport trucks rolled up 14.599 million miles, up 7 percent from the 13.645 million miles logged the first five months of 2006.

With diesel prices hovering 15 cents a gallon higher in the West Coast than the national average, longer trips to lower-priced regions can help, but there are other factors.

"What we measure is revenue per mile," Card says. "We're going farther away with less-favored customers, going to areas that don't pay as well just to keep trucks busy. With more competition in pricing it makes it more difficult sometimes to get (the rate) you want."

Combined Transport operates in the truck load sectors, picking up and delivering a single shipment and taking it to a specific destination. While customers have gotten used to paying fuel surcharges, trucking companies absorb the costs when they're rolling without loads — known as deadhead runs.

"If we're taking a load of lumber from Roseburg Forest Products to Sacramento and then going deadhead to Fresno to pick up a load of glass, nobody is paying a fuel surcharge for those empty miles," Card says. "We're running a higher percent of deadhead miles than in the past."

Cross Creek Trucking runs a combination of truckloads and less than a truckload, says the Central Point company's president, Mike DeSimone. The company transports food in its refrigerated trailers and still runs 75 percent to 80 percent up and down the West Coast.

Cross Creek's fleet has expanded to 115 trucks from 92 a year ago and it anticipates logging 13.142 million miles in 2007 after traveling 11.176 million in 2006.

"We've grown with our customer base," DeSimone says. "We work more with receivers than shippers and a lot of them are small. Most everything we take south is a full load so we can place our trucks in growing areas and then they return to the Northwest with less than a truckload."

He says marketplace pressures have weeded out inefficient haulers that undercut companies that understood their costs. Shippers that went for the lower price find themselves without a truck.

"Now when the phone rings," DeSimone says, "it's someone on the other end needing a truck and our dance card is full."

Card says that after three years of 13 percent growth, Combined Transport will see less than 2 percent growth in 2007.

"Still, 1 percent means there is 1 percent more trucks on the road," he says.

Reach reporter Greg Stiles at 776-4463 or e-mail

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