Keep on tracking: new ways to squeeze that extra gallon and save on high fuel prices.

• Author: Bohi, Heidi
• Position: ATA SPECIAL SECTION

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As diesel fuel prices rise on an almost daily basis with energy experts projecting the average will reach more than $4 per gallon this summer--and with West Coast stations reporting prices as high as $4.61--Alaska's trucking industry is bracing itself for a right-between-the-eyes backlash as prices show all signs of getting uglier throughout the year and painful economic impact ripples through the economy.

"Trucking companies will not be able to weather the dramatic increase in fuel costs that we have been experiencing," said Alaska Trucking Association Executive Director Aves Thompson said. "Something has to be done."

A one-penny increase in the price of diesel annualized over an entire year costs the nation's trucking industry an additional $391 million a year. High prices at the pump are being driven by surging crude oil prices, increased global demand for diesel fuel and an unexpected drop in crude inventories, along with steadily depreciating U.S. currency and investors who are purchasing oil because returns have outpaced stocks and bonds. Trucking burns an estimated 730 million gallons of diesel and 290 million gallons of gasoline each week and the industry is expected to spend an unprecedented $135 billion on diesel this year, $22 billion more than a year ago.

Historically, diesel fuel represents the second-highest expense after labor, accounting for as much as 25 percent of total operating costs. For the first time, for many motor carriers fuel is surpassing labor as their largest expense. Because Alaska receives 97 percent of all goods via water before being trucked from the docks to the front doors of businesses statewide, what are already astronomical shipping charges are undoubtedly going to have a dramatic effect on net disposable incomes for working families. As it is, the industry's per-mile cost of doing business is 30 percent more expensive than the Lower 48 states, resulting from higher wage, insurance and maintenance costs--all passed onto the consumer. Higher fuels costs are also placing tremendous economic pressure on the trucking industry and the business community. Fuel surcharges are one way the industry attempts to offset the high costs of diesel, but in many cases, operators simply have to absorb the loss, said Chuck Onstott, general manager of Midnight Sun Transportation and vice president of ATA.

Jimmy Doyle, vice president of Weaver Brothers, agrees adding that in some markets it means a...