Episode 12: Why This Fleet Owner Refuses to Grow Past 12 Trucks

Jamie Hagen discusses staying small and staying close to the drivers doing the work.

[00:00:00] Jamie Hagen: Trucking is a service job. What you’re paying for is the driver. The truck is just the tool. And I think some people get that kind of in their head backwards. They look at the trucks. What you’re really buying is the person and their time.

[00:00:14] Scott Feather: Hello, and welcome to Behind the Freight. Before we get into our conversation with Jamie Hagen, we have a special guest with us today. It’s Avery Vise.

Avery is the chief trucking analyst for FTR Transportation Intelligence, where he tracks freight markets and rate trends across the industry. Avery is going to be joining us to break down the freight market on a monthly basis, give us the trends for what’s been going on, and how you can better position your truck for the month ahead.

Avery, thanks for joining me and John.

[00:00:42] Avery Vise: Thanks for having me.

[00:00:43] John Howland: Yeah. So what a crazy, crazy summer. The last few months that we’ve had have been, in my opinion, chaotic for some, chaotic for most. What do you see the freight market doing? And are you surprised? Or just tell us about how it’s played out in August so far.

[00:00:59] Avery Vise: Sure. So one thing that’s been interesting is that the spot market has followed more or less the seasonal pattern. In fact, maybe a little weaker, arguably, especially in dry van.

And the reason that’s interesting is that you would say, “Well, why is the fact that it does what it always does interesting?” It’s because it’s done that in a period of time where diesel prices have risen quite sharply.

Over the past seven weeks, prices have risen $1.07. That was after it took nine weeks for it to drop $1.06, and that has had no effect, or at least no discernible effect, on spot rates in any of the equipment types. Now you could look at that two ways. Right?

One concerning way is that the market has peaked, it’s cooling rapidly, and this is happening at the same time diesel prices are surging. That’s a bad recipe. I’m sure those who have been around for at least four or four and a half years remember March 2022 when we had that happen.

Spot rates were coming down very sharply after an all-time high at the end of ’21, and then Russia and its invasion of Ukraine sent diesel prices up $1.15 in two weeks. A lot of companies went out of business.

A lot of those drivers went to work for larger carriers, and, actually, that set the stage in a lot of ways for the sluggishness, and that’s being euphemistic, I guess, that we’ve seen over the last four years in the trucking industry: that sort of rapid growth in carrier capacity right when the market is cooling.

That would be the glass-more-than-half-empty way of looking at where things are.The glass-half-full way is to say that spot rates are running 40 to 45% higher than they were a year ago. That’s more or less whether you exclude the need for fuel cost recovery or not.

If we recalculate a fuel surcharge, even though, obviously, a lot of carriers do not get one in the spot market, we calculate one really just to isolate the portion of rates required to recover fuel costs. Like I said, spot rates are running roughly 40% higher whether you look at dry van, refrigerated, flatbed, or specialized.

Specialized is a little weaker, but not significantly so. So the glass-half-full view is they don’t need to worry about it. Right? They’re doing quite well as it is, and that 40% is more or less stable even as rates have softened a bit.

So for carriers’ sake, that’s what they would hope would happen: that we continue to see spot rates remain pretty solid and follow seasonal patterns. We haven’t talked about what’s coming up, but we are getting close to what would be the bottom of the summer softness.

[00:03:50] Scott Feather: So you don’t see this as another lead-in like March 2022 where we have to worry about a longer trend? Do you think it’s more seasonal combined with some of the higher rates we’re seeing?

[00:04:01] Avery Vise: Right. I don’t think so. And the reason I don’t think so is that there isn’t any reason to think there’s this surge in capacity. You look at payroll employment, for example; it continues to be quite weak.

It’s bottomed out maybe in truckload, but not by much. The pressure on foreign drivers is not dissipating. If anything, it is getting tougher.

So I think what has probably happened is a lot of the things that have gone on, especially with foreign driver enforcement over the last year, have kind of worked their way out in a way similar to what happened in 2018 with the electronic logging device (ELD) mandate.

That was very disruptive, as everyone who’s been around for eight or nine years will remember. But after a while, you kind of figured out how to work around it. I think it’s similar because the number of drivers affected by English language and non-domicile rules is not enormous.

But what it has done is disrupt the normal pattern. Right? It’s disrupted a lot of lanes. But brokers are very savvy. They’re very adaptive. Over the last six or seven months where this has really made a big impact, I think they’ve learned to work with it.

Now that doesn’t mean the market is going to collapse, but what it does mean is that maybe that upward pressure is starting to stabilize. In fact, FTR’s own forecast has been pretty stable, in fact, quite stable, over the last three months.

Before that, we kept raising our rate forecast by a few percentage points every month. Now it’s very strong. Our forecast for spot rates excluding fuel is in the neighborhood of 35% higher year-over-year.

Our contract forecast is about 10% higher year-over-year, and that 10% is about the same for next year as well. I don’t think we’re looking at a repeat of 2022.

Now, if diesel prices were to continue rising and exceed the $5.81 record in June 2022 and keep going beyond that, yeah, at some point, unless we get some rate increases, that’s going to become problematic.

But that’s a ways down the road, and it’s very speculative. Crude prices seem to be easing. On the other hand, with diesel prices, there are some concerns there. One is that supply is not good, and that could have implications as we go through the year.

[00:06:23] Scott Feather: Well, with that in August too, what should people be looking out for going into September, talking about the future here? What do we think the next month holds, and does anyone need to prepare in certain ways for back-to-school or any seasonal trends there?

[00:06:37] Avery Vise: Yeah. In general, I think we’re past back-to-school for the most part. Only in certain parts of the country are we still probably in that mode. We do tend to get a bump up for Labor Day, whether that’s packaged with back-to-school or what have you.

But generally speaking, the market is in flux right about now. It might be a week later than usual only because Labor Day is a week later than typical. September 7 is the latest it can ever be, so maybe there’ll be a little bit of a delay.

Now, here’s what I would watch: if there’s no bump at all from Labor Day, I would start to worry if there’s no firming. We’ve already started to see a little bit with refrigerated, but it’s very shallow. Refrigerated rates were up a little over a penny week-over-week. It’s better than going down from the carrier perspective, but it isn’t much.

Flatbed, for example, has fallen sequentially for ten straight weeks. You think, “Well, that’s bad.” Well, no, it’s fairly normal to go from the midyear peak all the way through August, but rates do tend to firm up in early September.

So what I would watch as a carrier in this market is to make sure that we at least follow seasonal patterns. Everything’s okay if we follow seasonal patterns because the market has reset.

The market is much stronger than it was a year ago, two years ago, or three years ago. So as long as those seasonal patterns hold, they’re fine. If the market continues to soften into September and October, then it’s time to worry.

[00:08:21] Scott Feather: Well, you heard him, John. We gotta keep an eye out for that little bump. Yep.

[00:08:25] Avery Vise: And it’s not a huge bump, so people shouldn’t worry. It’s not like the end of June, but it is noticeable. I tend not to focus as much on specialized because it’s such a hodgepodge.

But for the other three major equipment types, the dynamics are much easier to understand, and I would definitely expect some sort of improvement in both volume and rates during that period.

Until you get to Thanksgiving, there isn’t a lot of change after that. When I come back in a month, I’m hoping I’ll be able to say it’s pretty much the same as last month. So, we’ll see.

[00:09:04] John Howland: Well, Avery, we really appreciate your wizardry, as I call it, your knowledge, and everything you bring to us in the industry. Thanks again for being on for this short piece, and we look forward to getting into September and talking to you next time.

[00:09:22] Avery Vise: Yeah, looking forward to it. So long.

[00:09:27] John Howland: Welcome to Behind the Freight. On today’s episode, we’re joined by Mr. Jamie Hagen. He is the owner and president of Hell Bent Xpress, a family-owned trucking company based in South Dakota.

He’s grown from a single owner-operator truck into a well-respected 12-truck fleet known for its commitment to service, safety, and professionalism. Jamie has spent virtually his entire life around trucks.

He started driving as a teenager, experienced the highs and lows of being an owner-operator, and has now grown Hell Bent Xpress into a successful small fleet. Along the way, he’s also become a well-known trucking advocate and a brand ambassador for Mack Trucks.

Today, we’ll talk about growing a trucking company the right way, balancing drivers’ needs with business realities, what he’s learned from his decades behind the wheel, and why bigger isn’t always better in trucking. So, Jamie, welcome.

[00:10:27] Jamie Hagen: Yeah. The way you make it sound, I sound old, decades in this industry! I’m also surprised nobody has adopted “Freight World” yet, you know, doing a Wayne’s World kickoff like, “Freight World! Party on!” Just waiting for someone to do that.

[00:10:42] John Howland: Hey, I think you’re onto something. Scott, let me introduce that. I love it! I’m curious, Jamie: Hell Bent Xpress, I love the name, by the way. How did you come up with Hell Bent Xpress? Where did that come from? I love learning these sorts of things about naming conventions.

[00:10:57] Jamie Hagen: Yeah. Well, I think it was pure luck or a gift from God, if you will. My CB handle was “Hellbent Hagen.” An old driver gave me that because he said I was always trying to do everything. I never said no. He just said, “You’re always hell-bent on getting everything done.”

When it came time to start an LLC, I thought I would just get paperwork in the mail; I didn’t know the process. So I called the State of South Dakota, and they were like, “Oh, yeah, let’s just do it over the phone right now. What’s the name of your company?”

I had to come up with a name literally in ten seconds. It came straight off the top of my head. I drove for Smithway Motor Express way back in the day, so “Express” was at the top of my mind. It just came out, and it worked out. We get compliments all the time.

[00:11:43] John Howland: Heck yeah. Before we kicked this off, we were both complimenting you on the name. It’s really cool.

[00:11:48] Scott Feather: Hey, sometimes you gotta pan for gold for a while, and sometimes you strike it right away, right?

[00:11:53] Jamie Hagen: Yeah, I stepped right in the river and picked out a nugget, just like that.

[00:11:56] John Howland: Perfect. I read that you spent almost your entire life in a truck, starting from when you were in diapers sitting with your dad as a little boy. What’s one memory you have driving with your dad, or what’s the first memory you have being in the cab with Pops?

[00:12:17] Jamie Hagen: I’ll never forget it. That’s the crazy part. I’m 52, and I still remember riding with him when I was four and five years old because it was exhilarating to leave South Dakota behind. We were in an old cabover TranStar with no air conditioning.

I remember going south and it being incredibly hot because both windows were open and I was just sweating. We sat in that cab right over the top of the engine, so you listened to it making noise the whole way. We took a load of grain down to Oklahoma on a flatbed with a side kit.

You had to take the side kit off to dump the load, they raised the truck vertically in the air. I remember helping him get out of the truck, having them tip it, taking the side kit down, and then pulling Ditch Witch equipment from Oklahoma up to North Dakota.

That’s my first memory, just helping him with all of that. Just a few years earlier, I was in diapers.

[00:13:15] Scott Feather: Oh my gosh.

[00:13:17] Jamie Hagen: So I’ve been working in this industry my entire life.

[00:13:21] John Howland: That is awesome.

[00:13:22] Scott Feather: I love how you remember the round trip, too, going out and what you had coming home. That’s awesome.

[00:13:28] Jamie Hagen: Yeah, but that’s the only one I remember vividly. He took me several times, but that first one was completely ingrained. You’re just a little farm kid going down to Oklahoma and seeing those massive grain elevators. You see pictures of them now and they seem like no big deal, but back in 1980, they looked huge.

[00:13:49] Scott Feather: And when you’re smaller, things seem gigantic.

[00:13:52] Jamie Hagen: Yeah. When you’re only three feet off the ground, it looks pretty big.

[00:13:56] John Howland: You’ve seen this industry from so many different angles: driving, being an owner-operator, fleet ownership, and now becoming an industry influencer. Was there a specific moment that served as the biggest learning lesson in your life in this industry?

What was that moment where you went, “Whoa, this is a huge step”?

[00:14:19] Jamie Hagen: Fleet ownership was the biggest leap for me. When you only have yourself to control, it’s easy, well, I shouldn’t say easy, we all have trouble controlling ourselves, right?

But when it comes to helping others and walking the line between business and people, that’s the hardest part of leadership in fleet ownership. What’s best for the business isn’t always what’s best for the people, and vice versa, so you have to find that constant balance.

Thank God my wife is there to help me. Every once in a while she reminds me, “You can’t just force somebody to do this or that. You have to take their interests to heart as well.” That’s been the hardest part because I’m gung-ho. I’ll do whatever it takes to get the job done because it’s my business.

It’s different when it’s someone else’s job and they just want to make a living and collect a paycheck. Balancing that has been the hardest part for me.

[00:15:19] Scott Feather: We all need that better half to reel us in when we go too far to one side or the other.

[00:15:25] Jamie Hagen: Yeah. If it wasn’t for her, I don’t know if we would have made it this far, really. I probably would have pissed everybody off.

[00:15:31] John Howland: Kudos to Mrs. Hagen. We appreciate you!

[00:15:34] Jamie Hagen: Yes. Big shout-out to Hillary.

[00:15:35] Scott Feather: Reading up on you, I saw your piece in Heavy Duty Trucking about being an owner-operator, having a few good years, upgrading your truck, getting a nice rig, and then having operating costs hit when the market shifted. What did that experience teach you, and how did it shape your business lessons going forward?

[00:16:02] Jamie Hagen: Lessons in business aren’t always fun. It’s fun when you’re making money, but when things turn, you have to adapt. We’ve been doing this now for six years as Hell Bent Xpress, and how we started versus where we are today is completely different.

The people we’ve met, the drivers we’ve employed… we only have one guy who’s been here the whole time. Even the brokers you work with and the loads you haul constantly fluctuate. What you’re doing today isn’t necessarily what you’ll be doing tomorrow, which is crazy because how do you plan for that?

You buy equipment relying on a situation, and then that situation evaporates. That was a great lesson in trucking: don’t put all your eggs in one basket. Don’t assume that basket is going to stay there. Now we try to diversify a bit. We try not to get too specialized.

If a guy wants to be a specialty hauler, obviously go specialized, but we’re just dry van, trying to have good times out here on the road.

[00:17:13] Scott Feather: We like to talk about that because we’re in an era where a lot of carriers are thinking about upgrading or evaluating where rates are at. It’s a cautionary tale: you have to know your business and realize tomorrow won’t necessarily look like today.

[00:17:29] Jamie Hagen: Exactly. What you buy today still has a payment on it three or four years down the road. If the market can’t endure it, you find yourself in a sticky situation.

With these newer trucks, I saw the market shifting with the new EPA ’27 rules coming in and prices going up even higher. So we bought heavy this year, praying that the market will be great over the next couple of years.

I knew if we waited to leap into ’27, truck prices would go even higher and become even more complicated, and they’re already complicated enough. It’s a greater risk and a gamble, but you have to do it. That’s trucking: you just have to send it and hope in the Good Lord that it all works out.

[00:18:15] John Howland: Love it. You mentioned previously that it’s okay to say no to a customer if it’s beneficial to your business and your drivers. How did you come to realize that protecting your people is ultimately better than taking on business that may not be healthy?

[00:18:37] Jamie Hagen: There again, my wife comes into play. She was the one who said, “You don’t have to say yes to everything.” I’m a yes-man; I like the adventure and experience. Whether it’s good or bad, you learn something from it, so I’m more than willing to do something foolish just for the experience.

My wife said, “Maybe we should say no to a few of these demands because it’s getting crazy and the guys aren’t happy.” That was part of learning what I consider acceptable versus what other people consider acceptable.

I’m willing to endure a lot of pain for the adventure of seeing how a scenario plays out, whereas an employee just wants to get from Point A to Point B smoothly. They wonder why you’re booking loads that deliver on top of a mountain, and I’m thinking, “Don’t you want to go to the top of a mountain? That sounds like fun!”

[00:19:42] John Howland: You just assume everybody’s adventurous like you! You can’t make those assumptions.

[00:19:46] Jamie Hagen: Exactly. So I’ve had to tone down my enthusiasm a bit.

[00:19:50] John Howland: What has been the biggest key to driver retention for you? You seem to do a great job managing a smaller fleet. What is the key to attracting great drivers and keeping them with you?

[00:20:07] Jamie Hagen: Being a driver myself, I approach it from that perspective. First and foremost, we have good equipment. Trucking is a service job, what the customer pays for is the driver, and the truck is just the tool.

Some people get that backwards and focus solely on the trucks, but what you’re really buying is the person and their time. I make sure our guys have good equipment so they can utilize their time efficiently, and then we treat them like human beings.

I tell applicants all the time: I can’t compete with a mega-carrier on health insurance or 401(k) matching. But what I can do is call you by your first name, know your birthday, and treat you with respect. If you’re not feeling well, I’m not going to force you out on the road just because a load is booked.

I started this company because I wanted to understand why fleets made the decisions they made. As a driver, I didn’t understand it. When you’re in leadership, you see the balance between business and people.

Bigger businesses often get hyper-focused on the business side and lose track of the fact that people provide the service. You want a happy employee showing up with a smile at shippers and receivers, not someone resentful.

Technically, driving a truck is an easy job, the hard part is the discipline to do it day after day, alone on the road with no one else to rely on when something breaks down. There is no Hell Bent Xpress without our people; that’s why I didn’t name it Jamie Hagen Express. I wanted it to be about the team.

Financially, fleet ownership isn’t the most lucrative thing I’ve ever done. The checks come in, but they go right back out just as fast. The most rewarding part has been the people. The team we have is fantastic.

[00:22:57] Scott Feather: I won’t tell you you’re wrong, Jamie, but from our side of the table, I don’t think many people would call it an easy job! Maybe for you.

[00:23:05] Jamie Hagen: Well, having done it for so long, it feels that way. I always joke that we could train a monkey to drive a truck, the monkey just wouldn’t work for bananas!

[00:23:14] Scott Feather: Don’t worry, the animal question comes up later, so keep that in mind! Jamie, Charles Gracie was on the show a couple of weeks ago saying something very similar: while benefits are important, more and more drivers value that personal touch and having a real relationship with leadership over sign-on bonuses.

It’s great to hear that consistency. I saw that Hell Bent Xpress recently transitioned from food-grade tankers to dry van work. What prompted that shift, and what opportunities did it open up?

[00:24:08] Jamie Hagen: The main driver was the economy cooling down. We were leased to Cliff Viessman Incorporated out of Gary, South Dakota, a great group of people, but their market share slowed down.

My drivers were tired of sitting around, so I started borrowing guys to handle the surging demand on the Hell Bent Xpress dry van side. Switching back and forth between tanks and vans got tiresome for them, and they eventually said, “We’d rather just haul dry van because you’re much busier over there.”

It worked out really well. Honestly, with current ELD enforcement, I could probably double our fleet size tomorrow if I could convince someone to lend me the money for more trucks!

[00:25:07] Scott Feather: How do you feel about operating a 12-truck fleet versus scaling to 30 or 40? Does staying smaller give you an advantage, or are you looking to expand further?

[00:25:21] Jamie Hagen: I don’t think I want to grow much larger than we are right now. This is the sweet spot for me to still do the operational work. When you get bigger, you lose touch with the daily reality because you transition from a lieutenant to a general.

You become disconnected from the front lines and have to manage through layers of leadership.

I still want to drive a truck. I was out driving earlier this morning, worked on a trailer, and then came over to record this podcast. That’s who I am. I don’t want to be the guy sitting at a desk, completely disconnected from the operation. I’m sure J.B. Hunt had no idea who worked for him at a certain scale!

[00:26:13] Scott Feather: The more epaulets on your uniform, the higher the view, but the 100-foot view feels much better than the 1,000-foot view. Staying close to your people is valuable.

[00:26:24] John Howland: Alright, are we ready for the lightning round? By the way, Jamie, you’ve already partially answered one of the questions!

[00:26:32] Jamie Hagen: Can monkeys drive? I don’t know, I really don’t!

[00:26:35] John Howland: These are quick-fire questions meant for short answers under 30 seconds. We’ll run through a few and wrap up the show.

[00:26:44] Jamie Hagen: Feel free to bleep out any cuss words I say.

[00:26:48] John Howland: Oh, no, those are staying, and we’re going to bold them, sir!

Here’s my favorite question: If animals could drive trucks, which animal would be the best driver and why?

[00:27:01] Jamie Hagen: I thought you were joking about that question!

[00:27:03] John Howland: No, that’s my signature lightning question.

[00:27:05] Jamie Hagen: Monkeys, obviously. They taught them how to fly planes! There was a movie about it not long ago. It’s a no-brainer: put them in a cab, show them the controls, and load up a trailer with bananas.

[00:27:18] Scott Feather: If we can send them to space, driving a truck should be easy enough, right?

[00:27:22] John Howland: Driver costs would drop significantly! Paying in bananas instead of real money, you’re onto something.

[00:27:29] Scott Feather: If you had to pick one book, podcast, or newsletter to recommend to people in logistics, what would it be? (Besides this podcast, of course!)

[00:27:40] Jamie Hagen: Are we excluding Behind the Freight? Is this a softball question?

[00:27:47] Scott Feather: You have to pick a different one. We’re obviously number one!

[00:27:50] Jamie Hagen: I love WHAT THE TRUCK?!? with Dooner. He’s super entertaining while keeping it focused on freight, so it isn’t dry.

I love podcasts. I grew up in an era before podcasts when you had to listen to dry talk radio or callers talking about space aliens. Now you can target specific topics you want to learn about. There are tons of great ones out there, just search Google for great logistics podcasts.

[00:28:36] John Howland: Who is someone doing great work in the trucking industry that more people should follow?

[00:28:43] Jamie Hagen: There are a lot of great people producing entertaining content on social media right now. But transitioning to fleet ownership means I don’t have much free time. I spend most of my day doing paperwork and personnel management rather than sitting in the cab listening to content.

Even when I’m driving, I’m usually on the phone. I usually discover creators long after they’ve established themselves, so that’s my non-answer!

[00:29:13] John Howland: That’s a raw, honest answer, which reflects how this entire conversation has been. Jamie, I really appreciate your openness and the personal touch you maintain with your drivers. Thank you for everything you do for the industry.

That concludes today’s episode. Thank you to everyone for listening to or watching Behind the Freight. This is John and Scott, and we are out. Thank you!

[00:29:42] Jamie Hagen: Freight World. Excellent.

[00:29:45] John Howland: Party on! If today’s episode helped you think differently about your operation, share it with someone in your network. If you’re looking for tools to keep your trucks rolling, from finding quality loads to getting paid faster, Truckstop.com is here to help.

Visit Truckstop.com to explore load boards, rate insights, and risk management solutions built for carriers and brokers. Thanks for listening to Behind the Freight. Until next time, keep the wheels turning and the bad loads burning.