To that end, transportation companies have been working hard in recent years to do everything they can to optimize the routes they travel, ensuring they drive the fewest number of miles in the shortest amount of time with the most amount of cargo on board.
When companies are able to achieve their most optimal operations, they are able to be more eco-friendly, more fuel efficient and more affordable.
That being said, deadhead is still a major concern in trucking. Below is a further explanation as to what deadhead is, how it's calculated and its effects on the industry.
What Does Trucking Deadhead Mean?
Sometimes called empty miles, deadhead occurs any time that a truck is being driven with a trailer that is empty. Once a truck unloads all of its cargo to the final destination, every mile it drives from that point on is considered deadhead until the next load is picked up.
Eliminating deadhead altogether is practically impossible. The only way this could occur is if a trucker was always picking up a new load at the final destination to which he was dropping off his current load.
Still, it's in the best interest of every trucking company to reduce deadhead as much as possible because it's very costly.
In addition, deadhead trucks can be dangerous. A study conducted by the Curtin-Monash Accident Research Centre, for example, found that deadhead trucks are 2.5 times more likely to be involved in an accident than those that are carrying freight.
What is Deadhead Loads?
Deadhead loads are any trailer that is empty while being driven by a semi-truck. This can occur after a driver unloads all the cargo at the final destination. It can also occur when a driver picks up a truck and needs to drive it to the first pickup point.
What Does No Deadhead Mean in Trucking?
No deadhead, by contrast, is the exact opposite. It occurs any time a truck is carrying a load to a destination and is being paid to do so. It's in the best interest of all trucking companies to increase their no deadhead miles while decreasing their deadhead miles, for the reasons mentioned above.
What is Bobtail and Deadhead?
One slight variation on deadhead is what's known as bobtail. This occurs when a trucker drives on the road without a trailer attached to the cab. In some instances, drivers will drop an entire trailer off at a location and then need to drive to a new location without the trailer attached.
Because a truck that is bobtailing obviously can't carry any freight, it can't be earning any revenue for the company.
What Does Empty Mean in Trucking?
In trucking, empty refers to any time that a truck is being driven without any cargo on board. This can happen in a deadhead situation -- with an attached trailer that isn't carrying cargo -- or a bobtail situation -- with no trailer attached at all.
In both of these cases, it's referred to as empty not just because of the lack of cargo, but because of the lack of revenue being earned.
How Do You Calculate Deadhead Miles?
Deadhead miles are quite easy to calculate for most companies. All you have to do is simply take the total amount of miles driven and subtract out the number of paid miles that were driven.
For example, if the total miles driven were 12,500 and the paid miles were 11,950, the deadhead miles would be 550.
Do Trucking Companies Pay for Deadhead Miles?
In some way, shape or form, trucking companies will pay for deadhead miles. What those costs are, and how they are paid, depends on the exact arrangement.
Trucking companies that hire full-time employees as their drivers will typically have to pay their drivers for deadhead miles. This means they are paying the drivers for their time and work, even though the drivers aren't earning the company any money while they're driving the deadhead miles.
These costs may be avoided if the company hires independent contractors to be their drivers, or they may be able to passed onto a customer, in certain situations.
However, there are always costs associated with deadhead miles for trucking companies.
What are Deadhead Costs?
There are a few different costs that go into deadhead.
The first and most obvious is the cost of diesel fuel. Trucking companies that reimburse their drivers for all miles will be paying for the cost of fuel that's only being used to go pick up a new load. Owner/operators or independent contractor may need to shoulder these costs on their own.
In addition, there is also the cost of wear and tear on the equipment. Every mile that's driven causes the vehicle and its parts to wear down. That's why it's essential that trucking companies optimize the miles they drive, so that as few empty miles as possible are driven.
Deadhead also creates an opportunity cost. Every deadhead mile takes away from revenue a trucking company could be earning.
Finally, there is the cost of safety in regard to deadhead. As mentioned before, deadheading can be an unsafe situation. Accidents not only cause harm, they can cost a lot of money.
Are Deadhead Miles Tax Deductible?
Another big downside to deadhead miles is that they are often not tax deductible. That's because trucking companies -- as well as owner/operators -- are only allowed to deduct expenses that were accrued while they were working.
Taxes are taken out of profits of jobs, and not revenue. In other words, deadhead miles are already factored into the equation in regard to taxes. If you attempted to deduct deadhead miles, you would essentially be trying to take the same deduction twice.
What Does Backhaul Mean in Logistics?
What Does Backhaul Mean in Logistics?
To reduce deadhead miles, logistics companies try to maximize backhaul.
Remember that deadhead occurs when a truck drives back to its original destination after dropping off its freight, but does so with an empty truck.
Backhaul refers to carrying freight back from this destination for part or all of the return trip. What backhaul does, essentially, is convert deadhead miles into miles that generate revenue for a company.
Even if the company is only able to backhaul 50% of the trip, they will be reducing their deadhead miles by half while increasing their revenue at the same time.