Although the airline, insurance and tourism industries will bear the greatest financial hits from the Sept. 11 terrorist attacks on the World Trade Center and the Pentagon, the trucking industry too is in for an uncertain period, industry observers and others say.
The industry will likely face continued delays crossing the border with Canada, a likely delay in opening the border with Mexico, greater attention to hazardous materials shipments, some heightened security in roadside inspections, continued economic troubles, potential price gouging on fuel and insurance, more onerous intermodal transfers at the ports of entry and the potential call-up of thousands of truck drivers who serve in the military reserves.
Border delays
Trucks crossing the Canadian border felt the impact of the attacks immediately and severely. In the first days following the attacks, delays ran as long as 15 hours as the Customs Service declared a “Level One Alert,” which requires maximum inspections of every crossing vehicle. By the following week, delays had dropped to between one and four hours, but they are expected to continue.
“The backups will continue for some period of time, at present levels or ramped up for a considerable period of time in the future,” says Steve Campbell, the president of the Commercial Vehicle Safety Alliance, whose members include police, state troopers and other truck safety enforcement officials. “Life will not be the same coming into or leaving the country,” Campbell says.
The worst-hit crossings were at the Buffalo Peace Bridge and Queenston-Lewiston Bridge in New York, the Windsor Tunnel and Ambassador Bridge in Detroit, the Blue Water Bridge in Sarnia, Michigan, and the Blaine, Washington crossing. Customs added dozens of inspectors and National Guardsmen to the crossings to help ease the flow.
Treasury Secretary Paul O’Neill, testifying before the Senate Banking Committee, pledged that Customs will “do everything we can to drive these [delay] numbers back to very small minute delays.”
O’Neill also said his department was talking with General Motors, which ships a large volume of goods across the border at Detroit, to find solutions. One would involve bonding shipments at the plant – fitting vehicles with an “electronic interlock” and scanning them electronically at the border to ensure they have not been opened en route. “They could go sailing through border points, without further inspection,” O’Neill told the committee.
The Federal Motor Carrier Safety Administration, in an emergency temporary move, eased hours-of-service rules for trucks making the Canadian crossing. The changes extended HOS deadlines by two hours with an area 50 miles from the border for a delayed driver to find a place to rest or make his delivery. But the driver must prove that he is running over his hours limit through logbook entries, a manifest or a bill of lading. The relaxed rules apply only at crossings experiencing “extreme delays,” FMCSA said.
Trucks crossing the Mexican border also experienced extended delays, but the traditional delays there have been so long that the impact was not as severe as on the northern border.
Mexican debate on hold
Before Sept. 11, it appeared that the Mexican truck controversy would be one of the biggest issues in Washington this fall. Observers say that the terrorist attacks have reduced the chances for President Bush’s planned Jan. 1 opening of the border to Mexican trucks traveling to the United States. The attack slowed work on the fiscal 2002 Department of Transportation appropriations bill, which contained the funding for the added FMCSA inspectors and the construction of inspection facilities. Delays in approving the bill mean delays in getting the border ready.
The House and Senate bills also contain provisions aimed at delaying or blocking the expansion of Mexican operations. Those restrictions further complicate the work of the joint conference committee that will hammer out compromise language on the appropriations bill. Wading through those complications was a tall order even before legislators became totally absorbed in national security issues. But the business of government must continue, so Congress will do something. Indeed, a resolution may even appear easier because it’s unlikely to be accompanied by the usual rhetoric.
“I personally think there will be progress made,” says William Canary, the interim president and CEO of the American Trucking Associations. “What date the border opens, I can’t predict. [However] I do think the border will open.”
According to Timothy Lynch, president of the Motor Freight Carriers Association, Transportation Secretary Norman Mineta has said it was not gospel that the border had to be opened by Jan. 1. DOT staffers who have worked on the Mexican border issue have been shifted to other terrorism-related issues, and “so just that alone is going to make it probably very difficult to see that timetable met,” says Lynch, whose association represents major national unionized less-than-truckload carriers.
Hazmat and intermodal
Border issues aren’t the only operational concerns for the trucking industry. Containers brought in by ships from overseas will face tougher scrutiny. “Nobody knows what’s in those containers until they get potentially halfway across the country,” Lynch notes. So there will be slowdowns, especially in high-risk areas and major metropolitan areas such as the Port of Long Beach and Los Angeles, he says.
Carriers of hazardous materials will find themselves under the microscope as federal authorities fix their gaze on materials that can be used for weapons of mass destructions, such as biological, chemical and nuclear weapons. The Federal Bureau of Investigations isn’t just concerned with chemicals classified as hazardous. It’s also interested in the flow of precursors – normal industrial chemicals that are used in the manufacture of catastrophic weapons.
In response to the threat, the FBI began working with DOT to “ensure that adequate protective countermeasures are in place,” DOT’s Office of Security and Intelligence said. Carriers should report to the local FBI field office any suspicious activity, including threats, unusual purchases or suspicious behavior by employees or customers. In
addition, carriers with relevant information may want to contact the local FMCSA division office as well.
The concern was underscored less than two weeks after the Sept. 11 terrorist attacks when FBI agents arrested a Detroit man who held a commercial driver’s license with a hazmat endorsement, and reports said two other men earlier arrested also held CDLs with hazmat endorsements.
Drivers and fuel
Although a slowing economy has eased the industry’s chronic driver shortage, a major call-up of military reserves could cause some staffing shortfalls. ATA’s Canary estimates that as many as 5 percent of the industry’s 3 million drivers are active military reservists subject to a call-up that began the week following the Sept. 11 tragedy. “That could have a major impact on our industry,” he said.
Canary also warned about the possibility of price gouging on diesel fuel and on insurance, but pledged that ATA, through its members and state associations, would monitor the situation and bring any problems to the attention of federal authorities and states’ attorneys general.
While there was some gouging in the days after the terrorist attacks, with diesel prices spiking as high as $3 to $5 a gallon, there was no sign of widespread or prolonged price jumps, says Richard Holcomb, ATA general counsel and senior vice president for regulatory affairs. Canary said the association, in cooperation with others, would sue if needed to remedy gouging.
