Mixing Reefers into large Dry Van Operation

Gordon Trucking fits the profile of a small refrigerated carrier in a niche market extremely well, although the company actually is a dry van truckload carrier with a fleet larger than all but a few of the largest refrigerated carriers. This may seem a contradiction, but both images are correct.

Gordon Trucking in Pacific, Washington, a small community in the inland valley south of Seattle, was founded in 1946 as an intrastate malt beverage carrier. First, it used dry vans to haul beer in the state of Washington. In the 1970's, some beverage customers began shipping refrigerated beer, so reefer trailers were added to the fleet to provide a wider range of capability. After deregulation in the 1980s, the company expanded its dry van truckload carriage, with finished paper products, providing the largest volume. Today, Gordon Trucking operates 780 tractors and 2,500 trailers with annual revenue of almost $100 million in 1998.

Gordon Trucking also expanded its refrigerated service. It maintains a fleet of 100 refrigerated trailers that move beer, and frozen foods, including ice cream and fresh meat, south along the Pacific Coast and haul produce back north. In addition to its basic lanes, Gordon Trucking moves some produce south, especially cherries. Cherry volume doubled in 1999 from the previous year. Beer moves both directions. The company hauls beer from Seattle to California and returns with product from a different brewer in the San Francisco Bay Area.

Small Shipper Base The temperature-controlled division of Gordon Trucking is dedicated to a small base of no more than 15 customers when operations are at their peak. Southbound shippers account for the largest group-seven customers on a steady basis. Nearly all northbound freight is controlled by two large supermarket chains. One of these operates in Washington. The other has its produce delivered to an ocean forwarding service that stuffs the loads into containers for shipment to its stores in Alaska.

This small group of customers allows Gordon Trucking to run its temperature-controlled operation with a small group of managers. Overall supervision falls to Scott Gordon, vice-president of corporate development. Bob Dewey has handled sales for temperature-controlled freight for 17 years. Most customer contact and driver dispatching are handled by Pete Peterson who has been with the company for 18 years. He is assisted by Valerie Genne and Naida Bacon. The fleet is kept in condition by Morry Milsten, trailer shop supervisor, and Keith Mangus, refrigeration technician.

In addition to its north/south runs, Gordon Trucking's refrigerated fleet provides dedicated services to one large customer in Spokane, Washington. The company runs 12 to 20 loads a day across the mountains. Some of this equipment returns directly to the Seattle area. The rest is loaded with southbound freight and sent to California.

70% Refrigerated Freight Unlike many large refrigerated truckload carriers, Gordon Trucking tends to keep its refrigerated trailers filled with refrigerated freight. The refrigeration unit is required by at least 70% of the freight hauled in refrigerated trailers. The reefers haul dry freight only when a load is needed to position a trailer for a refrigerated load or when the company has a freight imbalance and needs to move a load.

For instance, one customer for southbound freight has been shipping ice cream from Seattle to Los Angeles for three years. Other freight, beer, and frozen foods are destined for the San Francisco Bay Area. Perhaps best of all, some southbound freight terminates in the Central Valley around Fresno. Gordon Trucking has some shorthaul customers in Los Angeles that allow the company to reposition refrigerated trailers for the produce haul with a paying load. Under the worst circumstances, the company only has 100 to 200 empty miles between a southbound load and a return load of produce.

As a result of the heavy requirement for refrigeration, the reefer trailer fleet at Gordon Trucking is designed for effective temperature control. "We haul everything from bananas at 58 degrees F to frozen foods at -10 degrees F or ice cream at -20 degrees F," says Milsten. "For that reason, we want trailers with adequate insulation and a strong refrigeration unit, not simply an insulted dry van with a unit. We have switched to 53/102 reefer vans, but our trailers have 21.2 inches of sidewall insulation. We don't want to take a chance on a load of ice cream in a trailer with 11.2-inch sidewalls on the desert stretches of I-5 where it is always 100 or hotter in the summer."

New Units Solve Problems Some of the newest trailers in the fleet are a group of 30 Great Dane Super Seal reefers purchased in 1997 and 1998. These trailers were originally equipped with Carrier Transicold Ultra refrigeration units. "We had a few problems with those units; we really don't know why," Milsten says. "The most common problem was unit shutdown in high ambient temperature conditions. Carrier Transicold acted very quickly to remedy the situation. They had just introduced their new Ultima 53 unit at the time these problems became apparent. We chose to upgrade to the new Ultima 53 units for more capacity and as a solution to our problems."

Besides high capacity in 53-foot trailers, the new Ultima 53 units add new capability to the service Gordon Trucking can offer. The units have data logging that the company uses to track unit performance and cargo temperature.

Gordon Trucking expects its refrigerated trailers to remain in the fleet for at least eight years. In addition to the 30 Super Seals, the fleet runs 70 Utility trailers equipped with Thermo King SB-III Max refrigeration units. To maintain as much standardization in the company as possible, refrigerated trailers are specified with the same spring suspension as the dry vans.

"We are aware that a lot of reefer carriers have switched to air suspension for trailers," Milsten says. "However, our experience with 2,500 vans is that conventional suspension costs less to purchase and much less to maintain."

All 100 trailers are the responsibility of Keith Mangus, the refrigeration technician. He inspects trailers and units while they are parked at customer locations. Trailers or units due for service are flagged for movement to the trailer shop in Pacific. Units are maintained according to the manufacturers' recommended 1,500-hour service interval. Depending on the work required, trailers are out of service for only two to four hours.

Tractors for the refrigerated fleet are no different than those used for the dry vans at Gordon Trucking. The standard fleet tractor is a C120 Century Class Freightliner. The company uses either of two Cummins engines. Some tractors are powered by an M11 engine rated at 370 horsepower. Others use the larger N14 ESP+ rated at 435 hp as its base rating with 500 hp available on demand. The tractors have a mix of nine- or 10-speed Meritor transmissions.

In addition to its standard fleet tractors, Gordon Trucking operates 15 Freightliner FLD120 Classic longnose conventional tractors for some top performing senior drivers. These tractors are powered by Detroit Diesel Series 60 engines rated at 435 hp. Two of these tractors are assigned to the refrigerated fleet.

Consistent Fuel Economy Regardless of engine size or horsepower ratings, fuel economy is remarkably consistent throughout the fleet. Tractors powered by the 11-liter M11 engines average 6.4 miles per gallon. The larger 14-liter N14s are slightly behind at 6.3 mpg. The 12.7-liter Detroit engines average 6.37 mpg.

Tractor trade cycle at Gordon Trucking is determined by mileage, not years. With average growth in the dry van business, the company has bought about 120 tractors a year for the past few years. "We trade tractors after 500,000 miles," says Gordon. "That can take as little as 30 months or as long as five years. In general, tractors run with team drivers for a year and are then switched to solo drivers for the remainder of the extended warranties."

Temperature-controlled freight contributes roughly $8 million to annual revenue at Gordon Trucking. The company does not project rapid growth for the refrigerated fleet because operating costs are higher than for dry vans, and qualified drivers are harder to find and retain.

Carefully Targeted Assets "We have a good group of customers who pay compensatory rates," Gordon says. "Expanding that customer base could possibly lead to competition beyond our core of regional service where we are particularly efficient. It only makes sense to keep our most expensive equipment in lanes that allow us to recover our operating costs. We have confined our refrigerated fleet to the West Coast lanes because that is where our main perishable customers are located. Those customers need a lot of service, so we don't have a lot of refrigerated assets available for other lanes."

The entire growth plan at Gordon Trucking is quite conservative with most of the emphasis placed on the dry van operation, which grows an average of 10% a year. The entire company doubled its size during the past eight years. Growth in the temperature-controlled division will remain relatively slow. "We could double the refrigerated fleet in five years, but that would be based more on demand from customers rather than an internal push to expand the reefer operation," Gordon says.

Gordon Trucking operates 70 tractors in its refrigerated fleet. Fifty of those are company equipment. The rest are leased from independent contractors. Tractors and drivers are assigned to the refrigerated fleet on a semi-permanent basis. The training required for refrigerated operations is the primary reason for this assignment, Gordon says.

Senior Drivers for Reefers In fact, drivers for the refrigerated fleet tend to be among the most senior employees at Gordon Trucking. Many of them have been with the company for 10 years or more, usually hauling for the same customers for that entire period. Senior drivers seem to handle the rigors of refrigerated freight better than newcomers, Gordon says. "Refrigerated freight is high maintenance in the sense that drivers spend a lot of time waiting to make multiple pick-ups, especially at produce shippers where we commonly make three to six stops before the trailer is fully loaded," he says. "We make sure that our drivers receive stop pay and detention pay for excessive waiting, but reefer freight still puts a lot of stress on drivers that requires the extra patience that senior drivers seem to develop."

This is not to say that new drivers are denied the chance to haul refrigerated products. Trainers in the Gordon Trucking driver development program look for new drivers that have an aptitude for refrigerated freight. Those drivers get special attention from dispatchers and are offered a place in the refrigerated fleet when a job comes open. They are trained by Keith Mangus to operate the refrigeration units and put to work on the north/south produce runs. Drivers that prove their ability with produce may be given an opportunity to haul dedicated refrigerated loads between Seattle and Spokane.

Many drivers at Gordon Trucking consider the 80 to 85 jobs with the refrigerated fleet as the best in the company. The work is a little more demanding than handling general dry freight, but the routes are consistent and drivers get home more often. Drivers on the Spokane run make one trip a day, typically sleeping in the truck on the shipper's lot between loads instead of returning to the Gordon Trucking terminal. They are home for weekends.

California Drivers Home Weekly Loads to California take five days for a round trip. Drivers on this lane make one trip a week and are home weekly. Veteran drivers want these trips because the mileage results in good pay plus consistent time at home, Gordon says. Most of the drivers on this lane have moved into the reefer fleet from vans.

"The pay is the same for reefer or dry freight loads," Gordon says. "The benefit derived from putting up with the stress of hauling produce is increased time at home. In general, our reefer drivers are easy to retain because they have already been with the company for a while. Fleetwide, our turnover rate is 47%. We've been able to reduce it to that level by listening to what our drivers want. One big improvement comes from the exit interviews we conduct with all drivers who want to quit. We take this as one more chance to address their concerns. We listen to them and fix their problem if we can or at least explain why we can't make the changes they want. A lot of times, somebody to listen is exactly what a driver who threatens to quit wants."