He’s making big investments to grapple with rising gas prices.
In the past 18 months, Coley has replaced almost half of his 34-truck fleet with newer, more aerodynamic models and has outfitted all 34 vehicles with speed limiters and air inflation systems to regulate tire pressure.
According to AAA, gas prices have risen for 29 consecutive days, and are 35 cents higher than a month ago. Businesses that rely heavily on the trucking industry are forced to either endure a slimmer bottom line or pass this hardship on to consumers.
Coley said high fuel costs and the investment outlay he has made significantly impact his profit margin. Each truck costs about $135,000.
Wiley Noah, a salesman at Busylad Rent-All, says the company has implemented a fuel surcharge in response to rising fuel costs but has not increased prices. “When the price of trucking goes up ... companies have no choice but to offset,” he said.
John Bean, president of Eat With Us group that owns Sweet Peppers Deli, Park Heights and Harvey’s, said although higher gas prices have not significantly increased overall food costs for the company, they have affected volume. Bean said the strain on household disposable income has a big impact on dining out.
“The first thing people cut is entertainment expenses,” he said. “The first entertainment expense cut is dining out.”
Fears over diminishing profits could inhibit hiring, making a timidly optimistic economic outlook more bleak.
According to GasBuddy.com, an analytical site, you shouldn’t count on seeing lower prices at the pump any time soon. Analysts warn it could be November before prices drop back to the lower rates seen at the start of the year.
The increase is due to several factors including the closure and/or disruption of several refineries this year and uncertainly about Iran’s nuclear ambitions that many believe could threaten supply.
Also, gas prices usually rise in the summer due to a more expensive blend of gas refined in response to peak demand aimed at curbing emissions.
Experts say the best advice for now is to start making changes to reduce fuel consumption and plan for prices at the pump to remain high.