Owner-operators' 2023 income expectations trend sharply negative

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Updated Jan 8, 2023

This time a year ago, well before the extent of the coming year's cost-inflationary pressures were fully known, owner-operators delivered mixed signals for the coming year of 2022, though 65% predicted income to be better or about the same as prior year 2021. This year, the script has most certainly flipped on the 2023 outlook, with 61% looking out and seeing worse to come or about the same.  

Among commenters reflecting the near-majority fearing worse conditions ahead was one who, though fuel prices have moderated a bit in the last month, expected more hikes in the future: "With no end in sight on fuel prices going up, taking away from the bottom line, then '23 is definitely going to be worse than '22."

Today on Overdrive Radio, we're re-airing a September talk with Glen and Karla Horack, Glen named Owner-Operator of the Year in March of 2022. Horack's diligent approach to reserve-account savings is instructive for any owner-op looking to hedge against the chance of a big downturn. 

As Richard Davis noted in comments under the poll, reflecting on the spot-market boom year of 2021, "What goes up must come down."

Also among commenters was one commenting only as "Clint," noting the rush to the spot market of new carriers. "It's been real tough competing" with those who will take freight just to keep moving, regardless of the rate, through 2022. "Too many, in my opinion, unqualified steering wheel holders ... have been allowed on our roads."

[Related: 2023 headwinds blowing: Legal pressures, economic conditions for the year ahead]


Todd Dills: Happy New Year, everyone. It's Todd Dills again with Overdrive Radio, and popping on here before we get this episode for January 5th, 2023 fully going. As for some of you, this one will well be familiar. Truth is, I've been out of the office all week and thought to re-air this talk with last year's Owner-operator of the Year, Glen Horack, this week. It also features his wife and team operator Karla because, well, and it, Horack emphasizes necessary downtimes savings every single moment of any owner-operator's career, no doubt, well necessary in times like the present with economic conditions ahead, looking less than stellar, let's say, than they could. As I noted in last week's Year in Review podcast, almost half of all of you have indicated a pessimistic outlook for the year. Horack was thinking much the same as early as last June when we spoke for this edition of the podcast. Keep in mind that timing throughout as you listen as I'm going to re-air it as it played in September last year. Horack's millions of miles of experience speak for themselves though, so let's get to it.

Glen Horack: If you're going to do it, get your ducks in row before you do it and stick with them, that's the biggest thing is don't try to live on a shoestring.

Todd Dills: Regular Overdrive Radio listeners will well recognize there the voice of our Owner-operator of the Year, Glen Horack, Elkland, Missouri, with a simple piece of advice for those who will venture into trucking as an owner-operator. In this part two of our talk with Horack, we'll hear a great deal more from him about just what he means in that regard. Coming off a good two years for freight, speaking late in the month of June, Horack noted the cyclical nature of the trucking business.

Glen Horack: At least once every 10 years there is going to be a downturn.

Todd Dills: Best to be prepared for that always no matter what the current situation looks like.

I'm Todd Dills your host as usual for this edition of Overdrive Radio for September 2nd, 2022, just ahead of the annual Labor Day holiday. Horack, in a team operation with his wife and now longtime business partner, Karla, is looking forward, no doubt, to enjoying some time at home with family and friends with the big Sam Biggs Memorial Bike Show & Poker Run, a benefit to research into childhood cancers like the one that took the life of a close associate's seven-year-old cousin, inspired the annual event nine years ago now. It's a big family and community affair today, that's sure.

Glen Horack: We all pretty much do everything, we organize it and we work it, we participate in it.

Todd Dills: We'll hear more about the value owner-operator, Horack, gleans from his now more than three decade relationship with his leasing partner in Prime Incorporated.

Glen Horack: When you got a big company behind you, it's a lot easier to get stuff done as far as repairs. And I can go into a dealership as a single operator, they don't care when they get to me.

Todd Dills: First though, we'll dive into Horack's very early days just starting out after his time serving in the Marines with Charles [inaudible 00:03:24] three trucks, C & T Trucking.

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Todd Dills: So just who was owner-operator, Glen Horack, growing up? Was he the kind of kid who knew from a very young age that he was headed into at Class 8 over-the-road?

Glen Horack: Not really. I really had no desire drive a truck. I mean, I always liked driving big vehicles and everything. I was driving a trash truck when I got out of the military and a buddy mine was running the trucking company and I needed a job. I went over and basically, I made three trips around the parking lot and backed into three different doors and been on my own ever since.

Todd Dills: Right. Who is your friend with the truck company? What was his name?

Glen Horack: It was Charles Litterest. He had three trucks of his own and he was running a trucking company for somebody else where he had his trucks leased on at, that was KPH Transportation, they've been out business for years. His company was C & T Trucking.

Todd Dills: And so, you started in one of his three trucks there?

Glen Horack: 1976 International cabover. I worked for him, well, we were leased to four or five different companies when I worked for him. Like I said, I drove a cabover and I drove for him for two years and then, I went to work for KLM out of Mississippi and I drove for them for almost six years.

Todd Dills: Where'd you purchase your first truck or lease your first truck?

Glen Horack: [inaudible 00:05:51] it was in 1992 from Prime.

I had talked a couple Prime drivers at a truck stop one day when we were sitting there and they were telling me how things worked over there with their lease and purchase and stuff and I was young, "Sounds like you're making a lot better money there," and I came here, "so I'll give it a shot," and been at added ever since.

When you got a big company behind you, it's a lot easier to get stuff done as far as repairs. I can go into a dealership as a single operator, they don't care when they get to me. But you got somebody that brings them 20, 30 trucks a week or a month, they're a little more cooperative.

And I have never had any desire to have more than one truck because nobody takes care of your equipment like you take care of your equipment. I've seen so many people... Because my philosophy is if you can either own one truck or 10 trucks, you'll be profitable, anything in between, it's going to be tough. You only got three or four trucks, if one of them breaks down, then you got three trucks paying for four. Two of them break down, you got two trucks paying for four. And I have made awesome money from that. I mean, I've had to bust my butt to do it, but they've always had [inaudible 00:07:25] me to do it.

When I went to work for KLM, I thought I'd found a home forever, but after about five years, things kind of went to the toilet there and I was making less money after five years than I was making the first year I worked there. And I mean, all my working career, I'm always looking for something better. But I came here at Prime in '92 and I left in '95 and back in '96. And I wish I'd have never left because I've just... I know a lot of people that drive trucks, I don't know anybody that can make the kind of money... Well, I mean, there's people out there that do, but I mean, on a large scale as many drivers Prime has that drivers make the kind of money they make at Prime. We've got, I think, 1700 company drivers and all the rest are lease operators. Got almost 9,000 drivers now.

Todd Dills: They've got a huge brokerage division with a lot of dedicated carriers there.

Glen Horack: Yeah. Yeah. And there's a lot of guys over there who only got three and four trucks, but they've got the big company behind them too. But if you're actually out on your own and three trucks, boy, it's hard to make it. We get huge fuel discounts and everything else over here. I mean, a buddy of mine, he posted a receipt on there the other day, he bought fuel in California with $6.99 a gallon at the pump.

Todd Dills: And what did he pay?

Glen Horack: He probably paid [inaudible 00:09:02] at six.

Todd Dills: With discounts like those, it's easy to see the benefits of the buying power a large company affords smaller businesses like the Horacks, those that would stake their success on the connection. Some owners out there occasionally tell me that leasing to larger companies is going the way of the dinosaur in trucking, clearly, it's not the case as yet.

Nonetheless, I ask Glen then what he might say if he had a single piece of advice for a newly minted trucking business owner that's coming up in this day and age. There's plenty that can be gleaned from his story alone. In part one of his two-part podcast, we detailed his diligent maintenance emergency set-aside savings strategy. For instance, we've just heard him speak to the value of partnerships that he sees with his own at Prime. Yet when it comes to direct advice, here's what he had to say.

Glen Horack: As far as the owner-operator part is, if you're going to do it, get your ducks in a row before you do it and stick with them. I mean, that's the biggest thing is don't try to live on a shoestring because just one breakdown can put you out of business. The biggest thing is, kind of like I do, put so much aside for your repairs, and when bad times come...

Trucking, it's an up and down thing forever. We've basically had two real good years as far as freight-wise because it got behind so bad. But I'd say, at least once every 10 years there's going to be a downturn. And you don't have a lot of choices anymore, you're going to have to run newer equipment because as you're doing specialized in certain states because for long you won't be able to take some of these old... You already can't take a lot of it to California. It's a tough deal right now because I mean, at some point, fuel is going to have to change, it's probably going to be about two more years. But if you're charging the surcharge that you need to charge, like I said, I actually, make money off surcharge.

Todd Dills: Yeah. What kind of fuel mileage is your surcharge based on and what kind of fuel mileage are you getting in that 579?

Glen Horack: Fuel? I think Prime's got their surcharge based on seven miles a gallon and I get about 8.7.

Todd Dills: That's substantial.

Glen Horack: Plus with Prime's discounts, I mean, it's different all over the country, if you watch where you buy fuel, you can even make that greater too. I think that's one of the biggest challenges that true owner-operators have is they don't get the discounts that the big companies get. I mean, Love's and a few other places got some programs that if you factor with them and stuff with your discounts and stuff... But to get the discount that Prime give, I mean, I'd say, most places, we get a dollar a gallon off on price.

Todd Dills: There are in fact a variety of resources for independence relative to fuel discounts. The National Association of Small Trucking Companies Fuel Card program is well-known and we routinely hear good things about it. There's the Mudflap app for a variety of independent stops and plenty other fuel card programs for major chains and others like Love's program Horack mentioned. As noted, with Horack speaking in late June as Fuel continues to rise before falling some in more recent weeks in most places, Horack had this to say about his own discounts.

Glen Horack: But it seems right now that the actual discount is shrinking though. They send us a message every day on our app letting us know what fuel's going to do at midnight.

Todd Dills: Yeah.

Glen Horack: It'll go down for one or two days, then it'll go up for the next five days in a row, then it goes up much quicker and it goes down.

Todd Dills: Yeah. Sometimes you've got to laugh to keep from crying, right? Fortunately, at least, dynamics changed for fuel in the intervening weeks. Diesel prices certainly remain, no doubt, elevated above $5 per gallon in a national average in the most recent week. The latest hike came alongside the big fire at BP's big Chicago area refinery and shut it down temporarily. Let's hope those supplies get back rolling to normal levels quickly.

When I talked with Glen's co-owner, operator and wife, Karla, in the first part of this podcast, at least last week, she mentioned a real acumen for cooking in the truck, something that's helped the pair run an even leaner operation in more ways than one. Karla's cooking methods and recipes are diverse, though her in-cab cooking equipment is just a single, quite versatile piece that Glen describes here.

Glen Horack: She's got a rice cooker and she can cook anything that needs to cook right in that. She can fry, she can boil, she can just about anything she needs to do in that. We had Instant Pot on the truck, but it was so big that it just got in the way. One of the drawbacks of trucks is refrigerator space. If you're running hard, you don't have time to go to a grocery store every day.

Todd Dills: It can be difficult to scout out where you can get into a good grocery store, right?

Glen Horack: Yes, it can. I mean, there's more and more places out there that don't allow trucks on their parking lots. And the bad part of it is our wonderful drivers have done it to ourselves, they go in and trash a place, throw their trash out the window. And it's probably only 5% of the truckers out there that are like that, that's the 5% that shows up. Plus with the thefts that are going on out here now, it used to be that you could drop your trailer at the truck stop, bobtail over and do whatever you needed. But nowadays, you drop your trailer at a truck stop, you might come back and it's not going to be there.

Todd Dills: The CargoNet Cargo Theft recording firm just this week alerted members and folks in the trucking media too to be watchful this weekend, the Labor Day holiday upcoming, a time when extended down periods for many drivers can mean more trucks sitting idle in a variety of places. They noted, historically, that thefts recorded the Friday before Labor Day and the Tuesday after were the most common over the last five years. In a full 20% of those theft events, truck or trailer was last known to be left secure on Friday and almost a third of all theft complaints were then reported on the Tuesday after Labor Day.

CargoNet also reported a troubling trend, not related to cargo at all, but to the guts of trucks and tractors' computer systems. Thieves across the country have been targeting the quite expensive and hard to find truck electronic control modules. They expected a spike in such activity this Labor Day weekend too, so be advised.

The rise in cargo equipment theft through the decades has been a detriment to Horacks full enjoyment of the road in other ways too. As he notes and as his wife and partner in the business noted in part one of this podcast, it's limited opportunity to enjoy the various sites around the country the pair might otherwise have visited. Regular listeners will recall that Glen sold Karla on trucking with a CDL herself in part on their ability to see the country together.

Glen Horack: Because that's one of the biggest things I miss about the way that trucking has changed. Like she was saying earlier, no, I went and visited a lot of tourist style stuff when I was running by myself because you could do that, you could drop your trailer and then do bobtail. Well, you can't do it anymore.

Todd Dills: Perhaps as a result, the Horacks have been making their time at home, in Elkland, Missouri, count for more. Big part of that for Glen, for the last nine years, has been the Sam Biggs Memorial Bike Show & Poker Run, a benefit for research into childhood cancers named after a young cousin of a fellow Prime owner-operator and fellow Owner-operator of the Year as you'll hear. The ninth Annual Sam Biggs event is fast approaching too, set for next weekend after Labor Day is done this year, and launching from an American Legion location in Springfield, Missouri with a separate event in Illinois as well.

Glen Horack: Yeah, the one in Missouri is the week after Labor Day, and then, we have another one up in Illinois the following weekend.

We've been playing with that for years because the first three or four years, we had it the second week, August, and we got rain and rain and rain every year. Kind of moving around trying to find a sweet spot and it seems like beginning of September usually works out pretty good for us.

Todd Dills: Before the big snow storms and after the summer rains. How did that Sam Biggs run get started? And how much are you involved with it still in terms of organizing?

Glen Horack: I'm still involved with it just as much as ever, if not more. But a buddy of mine that I've known for years, he drives for Prime too, but his cousin, I'm not sure his first or second cousin, but their son died at seven years old of childhood cancer. And actually Thomas's daughter, she was 12 and her friend was 12. And they used to go on rides with their dads on the bikes. And they just come up with the idea, "Well, we're going for this ride, why don't we try to raise some money for research or whatever." And that's how it started. They started first year in Springfield and it was just basically a ride and people donated. And then, we changed it into bike show and poker run. And it's grown every year. We moved locations this year, we used to do in the parking lot of a bar and we've outgrown that, so now, there's an American Legion post there in town that we're using this year.

Todd Dills: Glen Horack's partner on the benefit bike show and poker run, his fellow owner-operator, Thomas Miller, as noted, with a storied pedigree himself, in 2015, he won the Owner-operate of the Year award in Overdrive and TCA's joint program. The Sam Biggs event is more than just these two owner-operators' baby though, it's a big tent affair from all involved, from family and friends, and the community at large.

Glen Horack: We've got probably a dozen people, all of our wives and friends, we got friends. I mean, we all pretty much do everything, we organize it, we work it, we participate in it. I've got a 2018 Indian. And I've got a 2016 Victory.

Todd Dills: Which one is the one that you ride the most? The Indian?

Glen Horack: The Indian. Yeah. Actually, I parked my 2000 Victory 'cause we got rid of our house years ago and we went and bought a fifth-wheel and we pretty much just stay in it, or we stay at my daughter's house, one or the other. And my Indian or my Victory, I park in my son's a garage. Well, he's got an older Honda. Well, since I park my bike in his garage, he ain't rode his bike since.

Todd Dills: He might be on his way to inheriting that one, as it were.

Glen Horack: Yeah. Yeah. Yeah, probably. It's probably been four years since I even rode that one. The only reason I got two of them is back when we were doing our dedicated flowers up to Canada, I kept one in Missouri, I kept one down in Florida 'cause we were down there a day and a half every week.

Todd Dills: Yeah, you would use it down there when you were off. Yeah.

Glen Horack: Yeah.

Todd Dills: Take some downtime.

Glen Horack: Yeah, because I mean, ride all year down there. I'm not going to lie to anybody, I'm a fair weather motorcycle rider. I've ridden in the cold a couple times, that's not for me.