Truck companies are using new strategies to combat rising fuel prices

Filed in archive Market Overview on April 24, 2008

It's common knowledge that the price of Diesel in the U.S. has been rising like crazy. For example, average price per gallon of diesel is currently $4.143 per gallon-representing an 8.4 cent spike over last week's $4.059.

In order to combat these issue, there are only two options: Reduce the prices and reduce the use of diesel. Unfortunately, the prices are rather uncontrollable now, so the truck companies have started to look for new strategies to reduce the amount of diesel used:

- Analyzing the freight portfolio carefully and look for ways to decrease the weight (e.g. packaging removal where possible).

- Partnering with other companies and buying in volume (marginal effect on cost because of high volume buying but not that much).

- Using more sophisticated forecasting techniques to estimate the fuel requirement and act beforehand in the case that helps to reduce the price.

- Using new techniques to reduce the tax on the fuel (from lobbying to transport optimization of fuel regarding tax).

What experience do you have with this?