Pulse

Max Heine | February 01, 2010

MaxForewarned is forearmed

 

Some lessons are learned the hard way. Just ask the 1,400 drivers or owner-operators formerly with Arrow Trucking, many of them stranded after the Dec. 22 shutdown.

The subsequent lawsuits will take months to shake out, but in the meantime here are a few takeaways from the episode:

HEED WARNINGS. When paychecks bounce, as reportedly happened with Arrow Trucking, it speaks more loudly than any excuses from management. And there were other signs. Mark Miller of Portland, Ore., who in 2005 began a lease-purchase through Arrow Trucking of a 2006 Kenworth T600, told me of repeated appeals he and others had to make when denied permission to use escrow funds for maintenance. Not to mention three cases where his escrow funds were withdrawn for repair work at Arrow Trucking’s shop that was never done. “So I threatened to sue them, and the money reappeared,” he says.

MAINTAIN AN EMERGENCY FUND. Arrow Trucking’s abrupt closure is out of the ordinary, but the need to change carriers isn’t. Your downtime, fees and the readjustment to a new operation can drive the cost of changing above $10,000. It’s hard enough to save for major maintenance, but add a little extra for major business fixes, too.

KNOW THE OWNER-OPERATOR MARKET. Compensation terms are constantly shifting. (See Max Kvidera’s story about this on Page 31.) Talk with other drivers. Read recruiting ads. If a need to change carriers comes unexpectedly, you’ll want to know where to hunt and what to expect.

In the case of Arrow Trucking, whose officials have been unavailable to respond to media inquiries, the point about warnings is perhaps the most glaring, though not everyone was free to act quickly. Those in Miller’s position didn’t want to walk away from thousands of dollars invested in their lease-purchase.

“Guys with three or four years’ worth of payments – some of them had their trucks taken back,” he says, after Arrow Trucking cut their miles and made it virtually impossible for them to make payments.

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Mark Miller is fighting to clear the title on his lease-purchased truck.

Miller says that was about to happen to him in August. He immediately sold some assets, paid off his truck early and leased to another carrier, only to learn later that Arrow Trucking had refinanced his truck without his knowledge. Now he’s unable to drive until he can clear his title from its lien.

 “I’ve been warning drivers of this for over a year,” Miller says. “I told everyone the same thing: Have $300 in your pocket because they’re going to abandon you.” Many disagreed, saying the owners were putting their own money into the 61-year-old company. “I said, ‘No, they’re robbing us blind. I’d start looking for another job.’ ”

 When confronting reality is hard, it’s human nature to engage in denial, but that can be a painful path. You chose to become an owner-operator because you want to control your destiny. Do your best not to let control slip to someone else.


Do you have questions or comments about this column? Email Heine at mheine@rrpub.com

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