SAIA INC 10-Q

Item 3. Quantitative and Qualitative Disclosures About Market Risk The Company is exposed to a variety of market risks including the effects of interest rates and fuel prices. The detail of the Company’s debt structure is more fully described in the Notes to Consolidated Financial Statements set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. To help mitigate our risk to rising fuel prices, the Company has implemented a fuel surcharge program. This program is well established within the industry and customer acceptance of fuel surcharges remains high. Since the amount of fuel surcharge is based on average national fuel prices and is reset weekly, exposure of the Company to fuel price volatility is significantly reduced. However, the fuel surcharge may not fully offset fuel price fluctuations during periods of rapid increases or decreases in the price of fuel and is also subject to overall competitive pricing negotiations. The following table provides information about the Company’s third-party financial instruments as of September 30, 2020. The table presents principal cash flows (in millions) and related weighted average interest rates by contractual maturity dates. The fair value of the variable and fixed rate debt (in millions) was estimated based upon levels one and two in the fair value hierarchy, respectively. The fair value of finance leases is based on current market interest rates for similar types of financial instruments. Expected maturity date 2020 2020 2021 2022 2023 2024 Thereafter Total Fair Value Fixed rate debt $ 4.9 $ 20.6 $ 19.5 $ 14.6 $ 10.2 $ 6.1 $ 75.9 $ 76.1 Average interest rate 3.5 % 3.5 % 3.5 % 3.5 % 3.5 % 3.5 % Variable rate debt $ — $ — $ — $ — $ 45.0 $ — $ 45.0 $ 45.0 Average interest rate — — — — 1.4 % — 21