“The slowing economy and the worst winter in many years were the main factors that affected Smithway’s profitability during the first quarter, along with many other companies in our industry,” said William G. Smith, the company’s chairman, president & CEO. “Soft freight demand caused a combination of fewer loads, rate pressure, higher non-revenue miles and more layovers.”
Smithway said its average revenue per tractor per week dropped $130, reaching $2,193 in the first quarter of 2001, down from $2,323 during the same period last year. The harsh winter added to the problem, increasing fuel, towing and repair expenses, making deliveries difficult, and further slowing the activity of customers in Smithway’s core building-materials group.
In addition, increased engine idling because of the cold weather and higher non-revenue miles reduced the overall effect of its fuel surcharges, the carrier said.
However, the company believes there may be a silver lining to these problems.
“As much as the current trucking environment has impacted us, it has hit many of our competitors even harder,” said Smith. “Some have gone out of business and more will follow.”
