United Carrier Registration Agreement board of directors voted to keep the 2008 UCRA fees the same as the 2007 fees. The decision avoids a time-consuming federal rulemaking by the Federal Motor Carrier Safety Administration, which is required if the fee rate changes. UCR registration and collection is set to start this month; carriers can expect to receive a letter of notice from their base states when the collection process is under way. Also, 2007 collections were at $68 million, significantly lower than the $108 million projected.
Trade using surface transportation between the United States and its North American Free Trade Agreement partners Canada and Mexico was 8.6 percent higher in November 2007 than in November 2006, reaching $70.4 billion, according to the Department of Transportation’s Bureau of Transportation Statistics. The value of U.S. surface transportation trade with Canada and Mexico fell 5.2 percent from October. U.S.-Canada trade jumped 11.5 percent compared to November 2006, while U.S.-Mexico trade rose 3.6 percent.
Fleet One announced a four-year contract with the Commonwealth of Kentucky to provide government entities with the Fleet One Local fuel card at more than 1,000 retail locations throughout the state. The contract allows for six one-year renewal options. Fleet One also announced an agreement with Hess Corp. to provide fuel cards for all 880 company-operated Hess locations in the eastern United States.
Depressed consumer and business spending and other elements of economic softness likely will keep Class 8 sales under 200,000 in 2008, a panel of analysts generally predicted at the Heavy Duty Manufacturers Association’s annual Heavy Duty Dialogue, held in late January in Las Vegas, Nev. How far below 200,000 depends on the level of U.S. economic weakness in 2008.
Freight demand will remain sluggish in large part due to decelerating consumer spending owing to inflation, loss of wealth because of declining housing prices, slower employment growth and tighter credit, said Chris Brady, principal of Commercial Motor Vehicle Consulting. Brady expects a gradual upturn in freight in the second half of 2008.
Martin Labbe, president of Martin Labbe Associates, projected Class 8 sales of 178,300 in 2008, adding that his numbers presume there is not a recession. If a broad-based recession does occur – or is occurring – those numbers will be significantly worse, Labbe suggested.
Stu MacKay, president of MacKay & Co., noted that his projections of Class 8 sales at the Heavy Duty Dialogue in January 2006 proved right on the money for 2006 and 2007, but he believes he will be far off on his projection for about 220,000 Class 8 sales in 2008. “It won’t even be close to that,” MacKay said, adding that he mostly subscribes to Labbe’s thinking that sales will come in at about 180,000 to 190,000 trucks. MacKay estimates that the crash in single-family home sales alone has cost the trucking industry about 8 million truckloads.
Kenny Vieth, a partner in A.C.T. Research, expects continued weakness in 2008 that could spill over into 2009. Vieth suggested that a pre-buy leading up to 2010 might not meet expectations because fleets will look to push off the projected 1-cent-per-mile increase in costs that 2010 trucks would represent.
Wright Express buys Pacific Pride assets
Wright Express Corp. on Feb. 7 entered into a definitive asset purchase agreement to acquire certain assets of privately held Pacific Pride Services Inc. for about $32 million in cash, financed through the company’s existing credit facility. The transaction was expected to close before the end of the first quarter of 2008. Pacific Pride’s network of independent commercial cardlock fueling sites processes about 32 million fleet card transactions annually.
Wright Express Corp. CEO Michael Dubyak said that the 330 independent distributors in Pacific Pride’s franchisee network represent an important opportunity for Wright Express’ new TelaPoint business, which offers a browser-based solution for fuel purchasing and inventory management.
Industry hauled two-thirds of U.S. goods, ATA says
The U.S. trucking industry in 2006 hauled more goods than ever before in a single year, the American Trucking Associations reported. ATA’s American Trucking Trends 2007-2008 reports that the trucking industry hauled 69 percent of the total volume of freight transported in the United States in 2006. This equates to an all-time-high carrying load of 10.7 billion tons, and $645.6 billion in revenue, representing 83.8 percent of the nation’s freight bill. “Americans should understand that their national economy is directly linked to freight transportation,” says Bill Graves, ATA president and chief executive officer.
American Trucking Trends, an annual state-of-the-industry report produced by ATA, reported that more than 26 million trucks of all classes played a part in reaching the tonnage milestone. Of this number, 2.9 million were typical Class 8 trucks operated by more than 750,000 interstate motor carriers. Class 8 trucks drove 130.5 billion miles of the total 414 billion miles traveled by all weight classes used for business purposes in 2005. The trucking industry spent about $111 billion on diesel fuel in 2007, up from $103.3 billion in 2006. Commercial trucks paid $35.2 billion in federal and state highway-user taxes in 2005.
The trucking industry continues as a major employer in the United States. Nearly 8.7 million people were employed in trucking-related jobs across all U.S. industries in 2005. Of these, 3.4 million are professional truck drivers.
Trucking also played an important role in trade exchanged between the United States and two of America’s largest trading partners, Canada and Mexico. Trucks transported 80.7 percent of the value of trade between the United States and Mexico in 2006 and 64.4 percent of the value of trade between the United States and Canada.
American Trucking Trends 2007-2008 provides information on U.S. truck tonnage, employment, freight revenues, shipment value, engine sales, modal share and international trucking. Trends contains data from different sources; therefore, the most recent year available may vary. The report can be purchased at www.truckline.com/store.