‘Empty miles’ racked up by truckers putting pressure on vital Canadian industry

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It’s mid-morning and truck driver David Phillips has already spent about an hour hooking up his giant double trailers that are stacked with fruits and vegetables. Weather permitting, by 11 a.m. he’ll be on the road for the little more than five-hour run from Winnipeg to Grenfell, in southern Saskatchewan.

Because of a snowstorm that parked the entire Winnipeg crew of Bison Transport the day before, and lingered into Friday, Mr. Phillips is playing catch-up. On the return leg of the journey his trailer will very likely also be fully loaded.

It’s shaping up to be a pretty good day during a particularly tough couple of weeks for Bison, a Winnipeg-based trucking company that transports goods all over Canada and the United States, and employs more than 2,000 drivers.

Due to the shutting down of non-essential businesses across the country because of COVID-19 restrictions, truckers are racking up more and more “empty miles” – driving empty trailers that generate little or no revenue.

“We are hauling a lot more empties than we used to because of the virus,” said Mr. Phillips, who’s been driving long haul for 33 years.

“There are days where I’ve hauled two empties all the way back.”

A few weeks ago, many trucking routes would have seen drivers haul essential goods on one leg of the journey but non-essential items, such as auto parts, snowmobiles or bathroom fixtures, on the other leg. No more.

“Any route that’s non-essential, that’s where we’re hauling empties,” Mr. Phillips said.

The empty-miles phenomenon is putting increased strain on a vitally important industry that already operates on spindly margins.

“Trucks are paid to move from point A to B, and from point B back with a loaded trailer. Trucks are not paid, for the most part, if there is not product in the back of that trailer,” said Stephen Laskowski, president of Canadian Trucking Alliance, which represents 5,000 member companies.

While the immediate pain is being borne by the trucking companies whose expenses, including driver salaries, insurance and maintenance, pile up on a weekly basis, over the longer term consumers will likely feel the pinch as well, as higher supply chain costs are passed on to everyone.

Rob Penner, chief executive of Bison Transport, said that before the virus hit, the company’s empty miles percentage was between 7 and 10 per cent. It’s currently running two to three times higher.

“Margins in trucking – it’s a penny business,” Mr. Penner said.

“Doubling your empty miles, you’re talking about taking your profit margin out.”

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A typical route for Bison this time of year might have seen one of its trucks departing Winnipeg with a load of peat moss bound for the U.S. Midwest. From there, the trucker might pick up a shipment of granola and take it up to Toronto. The final leg back west, to Winnipeg, could be a shipment of canned food.

But now, with peat moss classified as non-essential, it’s not being shipped, so Bison no longer gets any revenue for the first leg of the journey. The company’s costs, however, remain more or less the same.

Kriska Transportation Group, which employs 800 drivers, is also in a tough spot. The Prescott, Ont.-based company has seen entire routes wiped out, such as its deliveries in and out the Honda auto plant in Alliston, Ont. Kriska has had to lay off some of the drivers on these routes.

The company has also had to approach its customers about price hikes, or in some cases request that they wait an extra day or two to pick up a shipment, as the company scrambles to minimize empty miles.

“Those are tough conversations to have with customers right now,” said Mark Seymour, CEO of Kriska.

Sometimes adjustments can be made that ensure one leg of the journey that previously might have hauled non-essential goods is now transporting essentials, but no amount of strategizing can fix the dynamics of certain routes. Manitoba, and Winnipeg in particular, is a prime example of a “high consumption, low production," spot for essential goods, Mr. Seymour said. While there are options for shipping non-essential goods out of the city (peat moss, for example), there are very few options for essential goods, meaning Kriska has to swallow the empty miles for now.

Despite the hit, Mr. Seymour knows that compared to other industries that have been completely decimated, the trucking industry is so far holding up okay.

“A lot of things have gone to zero. Ours hasn’t. I feel blessed and grateful," he said.

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