American Trucking Associations is seeking nominations for professional truck drivers to serve on the 2009-2010 America’s Road Team. Sponsored by Volvo Trucks North America, the national public outreach program is led by a small group of professional truck drivers who share superior driving skills, remarkable safety records and a strong desire to spread the word about safety on the highway. The nomination form is at www.americasroadteam.com.
Freight Transportation Services Index fell 1.3 percent in December from its November level, turning down after two monthly increases in the largest monthly decline since November 2006, the Department of Transportation’s Bureau of Transportation Statistics reported. The December decline dropped the freight index into negative territory in 2007, declining 0.1 percent for the year.
National Conference on Weights and Measures unanimously decided to delay an official vote on retail fuel temperature compensation. The decision, made on Jan. 29, noted that there were too many unanswered questions to vote at the next annual conference.
J. Richard Capka, administrator of the Federal Highway Administration, resigned from the agency, the Department of Transportation announced. Capka, who had been with FHWA since 2002 when he was appointed deputy administrator, had led the agency since August 2005.
South Carolina can move forward with plans to build Interstate 73 now that the Department of Transportation approved environmental documents for the project. With all federal clearances in place, South Carolina can take the next step to explore financing options to start constructing the new section of interstate, according to DOT.
Sirva, a Chicago-based global relocation services provider, announced Feb. 5 that it reached an agreement with its lenders to restructure its senior secured debt through a voluntary prepackaged Chapter 11 reorganization.
Carrier News
YRC Regional Transportation, a subsidiary of YRC Worldwide, announced the Feb. 22 closing of 27 service centers operated by USF Reddaway and USF Holland.
Old Dominion Freight Line purchased selected assets of Sidney, Mont.-based Bob’s Pickup & Delivery, increasing the ODFL network to 204 service centers and enabling it to provide direct coverage to every state in the continental United States.
RoadLink purchased Seattle-based intermodal trucking service provider West Coast Trucking. Terms were not disclosed.
Kenan Advantage Group agreed to purchase Transport Service Co. The transaction – terms of which were not announced – was expected to close by the end of February.
Nebraska Transport Co. – a truckload and less-than-truckload carrier based in Gering, Neb. – announced the acquisition of LTL carrier Tri State Freight Shuttle, located in Sioux Falls, S.D. Terms were not announced.
The Federal Motor Carrier Safety Administration has extended the public comment period on its interim hours-of-service rule by 30 days. The original deadline for the submission of public comments was Feb. 15, but the deadline has been changed to March 17, FMCSA Administrator John Hill said in a Feb. 13 letter to Jacqueline Gillan, vice president of the Advocates for Highway and Auto Safety. FMCSA published a notice of the comment period extension in the Feb. 20 Federal Register.
Under the interim final rule, truck drivers continue to be limited to driving only 11 hours within a 14-hour duty period, after which they must go off duty for at least 10 hours. The IFR also retains the provision of the hours rules that allows drivers to restart their cumulative on-duty limits by taking 34 consecutive hours off duty. FMCSA is seeking comment on its methodology and on safety data that was not available when the agency issued its most recent version of the rules in 2005.
The agency issued the IFR in response to the decision by the U.S. Court of Appeals for the District of Columbia Circuit vacating those two key provisions of the existing rules. The IFR took effect Dec. 27 – the same day that a stay granted by the appeals court expired. In order to ensure no gap in coverage of the rules, the IFR temporarily reinstated those two provisions while the agency gathered public comment on its actions and the underlying safety analysis before issuing a final rule.
In its July 2007 opinion, the court voided the 11 hours of driving and the 34-hour restart on the grounds that the public didn’t have adequate notice of FMCSA’s methodology for analyzing crash risk. The IFR was developed after new data showed that safety levels have been maintained since the 11-hour driving limit was first implemented in 2003, FMCSA said.
The D.C. appeals court on Jan. 24 issued an order denying Public Citizen’s request to invalidate the IFR. Public Citizen claimed that the court’s prior decisions in the case effectively prohibited FMCSA from issuing an IFR that included the 11- and 34-hour provisions.
To view the IFR, comment, view comments or download supporting documents, visit www.regulations.gov and search FMCSA-2004-19608.
Cross-border program in court’s hands
The case turns on congressional intent
A federal appeals court on Feb. 14 heard arguments on whether the Bush administration can continue with the cross-border pilot trucking program with Mexico despite congressional attempts to stop it. As of late February, the U.S. Circuit Court of Appeals for the Ninth Circuit still had the case under review.
The cross-border program, which has been in place since Sept. 6, allows a limited number of Mexican trucking companies to operate beyond the 25-mile commercial zone in the United States. Under a reciprocity agreement with Mexico, the one-year pilot program also allows a limited number of U.S. carriers to operate into Mexico. The Teamsters, Sierra Club and Public Citizen sued the administration in August to block the program, which DOT says the United States is committed to as part of the 1994 North American Free Trade Agreement.
In December, Congress passed legislation banning funding to “establish” a program that allows U.S.-certified Mexican trucks to carry loads across the border and into the country. But the Department of Transportation argued that it interpreted “establish” as meaning to start a new program rather than to stop the current one.
“The congressional intent is unambiguous,” said Judge Dorothy Nelson, one of three appellate judges who will decide the issue. “The intention was to halt the pilot program.” But Judge Andrew Kleinfled seemed satisfied by the administration’s position that the new law only prevents new programs and doesn’t address the current one. The issue may hinge on the vote of Judge Michael Daly Hawkins, who didn’t indicate his stance. The court did not say when it might rule.
The Teamsters and environmentalists argued that the program will erode highway safety and eliminate U.S. jobs; they also say there are insufficient safeguards to ensure Mexican trucks are as safe as U.S. carriers. A lawyer for the Sierra Club said not enough Mexican carriers have qualified to enter the United States to provide the necessary data to show the pilot program is safe. He said the Federal Motor Carrier Safety Administration had planned to have about 100 carriers certified by now, but only a dozen Mexican companies have been cleared. “The agency never considered there would be so few carriers,” Sierra Club lawyer Jonathan Weissglass said. “It means the pilot program is a sham.”
Department of Justice attorney Irene Solet said the program requires border agents to ensure all Mexican truck drivers participating in the program have valid Mexican commercial driver’s licenses. Solet further argued that if Congress intended to “turn its back on the NAFTA agreement” with the law it passed barring establishment of cross-border trucking programs, “much more clarity from Congress would be expected.”
Supporters of the plan say letting more Mexican trucks on U.S. highways will save American consumers hundreds of millions of dollars. And they say U.S. trucking companies will benefit since reciprocal changes in Mexico’s rules permit U.S. trucks new access to that country. The “program gives U.S. truck drivers opportunities to compete and succeed in a market they’ve never before been allowed to enter while ensuring the safety of our highways,” FMCSA Administrator John Hill said after the hearing.
A week prior to the hearing, Washington lawmakers scolded Transportation Secretary Mary Peters during a Feb. 7 House appropriations transportation subcommittee hearing on President Bush’s proposed budget. Rep. Marcy Kaptur, D-Ohio, accused Peters of being in violation of the law for continuing the program. “It’s a mystery to me why, with all the other transportation needs we have in this country, you’re spending money on a program that we specifically asked you not to do,” Kaptur said.
Peters reiterated the administration’s view that the law enacted in December was too narrowly worded to end the program, and she also stressed that the program ensures that Mexican carriers comply with U.S. safety standards. “There have been no safety incidents involving these vehicles to date,” she said. None of the Mexican trucks enrolled in the program has been involved in an accident, officials said. They said the Mexican trucks have compiled an average 10 percent out-of-service rate since the program began, less than half the 23 percent out-of-service rate for U.S. trucks.
As of Feb. 4, FMCSA had granted authority to 15 Mexican carriers to operate in the United States beyond the commercial zones. Five U.S. carriers have been allowed to operate in Mexico.
Court: Maine can’t regulate delivery services
The U.S. Supreme Court last month unanimously invalidated parts of a Maine law that bars Internet tobacco sales to minors and makes delivery companies responsible for enforcing the law. The justices noted that federal transportation law bars states from regulating motor carrier prices, routes or services.
“Despite the importance of the public health objective, we cannot agree” with Maine’s approach, Justice Stephen Breyer wrote for the court in Rove v. New Hampshire Motor Transport Association. Federal law “says nothing about a public health exception” enabling state regulation.
The Maine law made it illegal for anyone to knowingly deliver tobacco products to a Maine consumer if the products were purchased from an unlicensed retailer. That section also stated that a person delivering a package “is deemed to know” that the package contains tobacco products if it (1) so indicates on any side other than the side directly opposite the label or (2) was shipped by a person listed by the Attorney General as an unlicensed tobacco retailer.
The trucking associations argued that these provisions would be such a burden on carriers and require such significant changes in procedures that the law constitutes a preempted regulation of services. The Supreme Court’s ruling could enable the transportation industry to argue that similar laws in other states are invalid.
Congress provides relief for equipment buys
The economic stimulus package passed last month by Congress and signed by President Bush provides enhanced expensing and depreciation relief for businesses buying equipment and placing it into service this year. A trade or business can depreciate an additional 50 percent of the cost of an asset acquired and placed into service in 2008. Eligible properties for bonus depreciation include (1) tangible property that had a recovery period not exceeding 20 years, (2) purchased computer software and (3) qualified leasehold improvement property.
Port of Long Beach approves Clean Trucks Program
The Long Beach, Calif., Board of Harbor Commissioners voted Feb. 19 to approve key elements of a Clean Trucks Program that will replace and modernize the entire port trucking fleet to slash truck-related air pollution by 80 percent within four years. After listening to testimony for more than five hours, the Port of Long Beach Commissioners voted unanimously to adopt a truck concession requirement that they believe will help identify “clean” trucks, ensure reliable drayage service and improve air quality, security and safety. Under the plan, only “clean” concession trucks will be allowed to work at the Port of Long Beach.
The concession requirement allows employee drivers, independent contractor drivers or a combination of employee and contractor drivers to work the port, as they do now. But for the first time, the port trucking industry will be required to meet clean truck, maintenance, security and health insurance requirements. Commissioners also finalized a $2 billion subsidy program to finance the lease or purchase of clean trucks.
The Commissioners also adopted several other elements of the program:
- A revision of the start date for the collection of the Clean Trucks cargo fee to Oct. 1 to allow time for distribution of radio-frequency identification tags and reader installation;
- Linkage of the Clean Trucks $35 per 20-foot container unit (TEU) cargo fee and the port’s $15 per TEU infrastructure cargo fee. This change targets older “dirty” trucks before new infrastructure is built with cargo fee dollars; and
- An exemption or partial exemption on the Clean Truck cargo fee for cargo owners who use clean trucks acquired without financing from the port.
The concessions require Licensed Motor Carriers (LMCs) register their drivers and trucks with the port, and tag their vehicles with RFID devices so the port can monitor compliance. The port plans to announce details on registration soon.
In November 2007, the Long Beach and Los Angeles Boards of Harbor Commissioners approved a ban on pre-1989 trucks beginning Oct. 1. By Jan. 1, 2010, only trucks built after 1993 will be allowed into port shipping terminals, and by Jan. 1, 2012, all trucks must meet 2007 federal emissions standards that make new trucks more than 80 percent less polluting than older trucks.
The plan has not won over truck drivers concerned about the price of emissions control technology. Also, public health advocates and environmentalists are worried that Long Beach officials went ahead with certain elements of their plan without the support of representatives of the neighboring Port of Los Angeles. Officials at the two ports disagree on a key issue; Los Angeles port officials would prefer trucking firms hire the independent drivers – an option backed by the Teamsters union and environmental groups, but one that Long Beach has rejected.
DOT IG to audit public-private partnerships
The Department of Transportation’s Office of Inspector General is undertaking an audit of transportation-related public-private partnerships. DOT IG said the objectives of the audit are to:
- Determine the cost advantages and disadvantages to the public sector of PPP transactions compared to the more traditional financing of transportation infrastructure projects through the issuance of debt by government or quasi-government entities in the public or municipal bond markets;
- Evaluate the benefits and value realized through PPPs to both the private and public
- Determine whether, and to what extent, PPPs result in operating efficiencies.
GAO: Public-private deals may prove costly
A Government Accountability Office report on highway public-private partnerships predicted those finance schemes can create costly highway monopolies. In its report, GAO said any benefits of public-private partnerships come with trade-offs that overlook public interest and are costly to the public sector; for example, tolls on privately operated highways likely will be higher than on publicly operated toll roads. GAO also criticized the limited efforts to systematically determine the public interest and to generate a cost-benefit analysis for each project.
GAO concluded that “there is no ‘free’ money in public-private partnerships.” It added that highway users also faced the risk of tolls being set that exceed the costs of the facility, including a reasonable rate of return, should a private concessionaire gain market power because of the lack of viable travel alternatives. “Highway public-private partnerships are also potentially more costly to the public than traditional procurement methods, and the public sector gives up a measure of control, such as the ability to influence toll rates,” GAO said.
The American Trucking Associations said the report confirmed its position that utilizing public-private partnerships to fund infrastructure ultimately can be more costly to the motoring public than traditional funding solutions and may not sufficiently consider the public good.
A full copy of the report can be accessed at www.gao.gov/new.items/d0844.pdf.
Paccar to use SCR for 2010
Paccar announced that it will use selective catalytic reduction as an element in its engine platform to meet 2010 Environmental Protection Agency standards for NOx emissions. In the Paccar platform, SCR will be used in concert with exhaust gas recirculation, the primary emissions component of most 2002 and 2007 heavy-duty engine technologies.
Paccar’s decision leaves only Caterpillar among Class 8 engine manufacturers as undeclared on how it intends to meet 2010 emissions rules. Like Paccar, Detroit Diesel and Volvo/Mack have said they will use SCR as an aftertreatment. Cummins and International, however, are relying only on EGR for their Class 8 offerings.
“The combination of SCR and EGR will provide Paccar customers a highly efficient solution to meet the rigorous 2010 emission requirements,” said Craig Brewster, Paccar assistant vice president. Brewster said the company’s vehicles have operated SCR emissions systems in Europe successfully for years.
“Paccar is working with SCR distributors to ensure a nationwide infrastructure is in place to serve our customers,” Brewster said. The infrastructure is needed to supply urea for the engines.
Current work on Paccar’s $400 million engine production facility in Columbus, Miss., is expected to wrap up in late 2009. The facility will produce the 12.9-liter and 9.2-liter MX and PR engines, respectively, for Kenworth and Peterbilt tractors, launching Paccar heavy-duty engines in the North American market.
“Paccar premium-quality engines will be offered to our customers to complement the engines available from our existing suppliers in North America in 2010,” Brewster said.
For more information on Paccar’s engine development, see “Paccar’s power play,” CCJ, December 2007.
– Todd Dills
Volvo to offer Cummins ISX in 2010
Volvo Trucks North America said last month it will continue to offer the 15-liter Cummins ISX engine certified for 2010 emissions standards in the Volvo VN. This is an extension of an existing agreement between Volvo and Cummins Inc.
“Our customers have indicated a desire to have both the Cummins ISX and the Volvo engine family available in 2010,” said Per Carlsson, president and chief executive officer of Volvo Trucks North America. “Cummins remains a valued partner of Volvo, and our customers will continue to benefit from our comprehensive engine lineup of Volvo’s 11-, 13- and 16-liter engines, plus the 15-liter ISX.”
“Volvo and Cummins have a strong legacy of serving the needs of our mutual customers in the North American truck market, and this agreement allows us to extend that legacy well into the future,” said Ed Pence, Heavy-Duty Engine Business vice president and general manager for Cummins.
CCJ Hotspots: New blood in the top three
None of last month’s CCJ Hotspots repeated, as the nation’s leading spot-market states in January – as judged by CCJ and TransCore – were Arkansas, Indiana and Minnesota.
In cooperation with freight-matching leader TransCore, we highlight the nation’s three hottest states – those where the outbound load-to-truck imbalance is most in favor of the carrier. We then pair these states with market rate data to identify the three best outbound paying lanes by each of the three most popular equipment types – van, reefer and flatbed.
And like the three origin states, all of the destination states have positive load-to-truck ratios. Load-to-truck ratio and market rate data are courtesy of TransCore. The goal is to highlight not only the best states for spot-market freight but also the best outbound opportunities from those states.
| Indiana (Outbound) | ||||||
| Destination State | Avg Rate | Min Rate | Max Rate | Avg Fuel Surcharge | Avg Accessorial | |
| Van | WV | 2.31 | 1.7877 | 2.8322 | 0.3 | 149.52 |
| ID | 1.8252 | 1.5819 | 2.0316 | 0.23 | 620.13 | |
| AR | 1.5452 | 1.3101 | 1.7803 | 0.32 | 196.8 | |
| Reefer | SC | 1.7457 | 1.5972 | 1.8942 | 0.29 | 283.05 |
| AR | 1.5218 | 1.3735 | 1.6702 | 0.35 | 245.22 | |
| ID | 1.4299 | 1.3668 | 1.4931 | 0.27 | 483.27 | |
| Flatbed | WV | 1.8497 | 1.5528 | 2.1467 | 0.07 | 30.17 |
| SC | 1.7505 | 1.5321 | 1.9689 | 0.16 | 145.24 | |
| ID | 1.731 | 1.4436 | 2.0183 | 0.14 | 325.41 | |
| Minnesota (Outbound) | ||||||
| Destination State | Avg Rate | Min Rate | Max Rate | Avg Fuel Surcharge | Avg Accessorial | |
| Van | WV | 1.8255 | 1.63 | 2.021 | 0.32 | 339.12 |
| ID | 1.7306 | 1.4293 | 1.9647 | 0.29 | 489.38 | |
| KY | 1.5195 | 1.3754 | 1.6637 | 0.3 | 261.72 | |
| Reefer | WV | 1.8107 | 1.75 | 1.9377 | 0.35 | 336.42 |
| SC | 1.7468 | 1.653 | 1.8406 | 0.36 | 155.02 | |
| KY | 1.6465 | 1.4964 | 1.7966 | 0.2 | 294.44 | |
| Flatbed | ID | 1.8646 | 1.7109 | 2.0184 | 0.34 | 685.6 |
| WV | 1.7656 | 1.6378 | 1.8934 | 0.31 | 455.56 | |
| KY | 1.6488 | 1.462 | 1.8356 | 0.3 | 466.63 | |
| Arkansas (Outbound) | ||||||
| Destination State | Avg Rate | Min Rate | Max Rate | Avg Fuel Surcharge | Avg Accessorial | |
| Van | WV | 1.8224 | 1.569 | 2.0757 | 0.3 | 258.74 |
| ID | 1.7638 | 1.4369 | 1.9984 | 0.28 | 573.14 | |
| SC | 1.5267 | 1.3141 | 1.7393 | 0.28 | 214.99 | |
| Reefer | WV | 1.8061 | 1.564 | 2.264 | 0.09 | 338 |
| SC | 1.782 | 1.6264 | 1.9376 | 0.29 | 323.6 | |
| MI | 1.7746 | 1.5524 | 1.9967 | 0.36 | 379.77 | |
| Flatbed | ID | 1.8132 | 1.4642 | 2.1622 | 0.15 | 347.59 |
| WV | 1.7519 | 1.6398 | 1.8639 | 0.39 | 243.11 | |
| MN | 1.6905 | 1.3839 | 1.9971 | 0.16 | 153.14 | |
Tonnage index surges 4.1 percent in December
The American Trucking Associations’ advanced seasonally adjusted For-Hire Truck Tonnage Index jumped 4.1 percent in December 2007, after rising 0.9 percent in November. The latest increase was the largest month-to-month gain since a 6.2 percent jump in December 2006. The not-seasonally adjusted index fell 8.2 percent from November to 102.7.
On a seasonally adjusted basis, the tonnage index jumped to 116.7 in December, its highest level since January 2006. Tonnage also was up 1.4 percent from a year earlier, marking the first sequential year-over-year increases since May and June 2006. Despite these increases, however, the annual tonnage index declined 1.4 percent in 2007, following a 1.7 percent drop in 2006.
ATA Chief Economist Bob Costello said the final two months of the year were surprisingly good given the current economic environment, the financial crisis, credit crunch and weak housing market. “Both the month-to-month and year-over-year increases were very encouraging,” Costello said. “However, the supply chain has changed during the fall freight season, leading to better Novembers and Decembers than in the past, so we shouldn’t read too much into the recent data at this point.” Costello places the odds of a recession at 40 percent and believes truck freight volumes will be volatile and lackluster in the first half of 2008.
