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Trucking Braces for New Environmental Protection Agency Regulations

As the administration continues to focus on efforts to combat climate change, President Obama has added emission rules for big-rigs to the agenda.

Some time ago, the president gave the Environmental Protection Agency (EPA) the go-ahead to develop new rules designed to improve fuel efficiency and lower carbon emissions for heavy-duty trucks. Now the industry is looking to see whether smaller fleets can meet the standard without going out of business.

The New York Times has come out saying they already know what the proposed rule will be, although it has not yet been published to the agency’s register. According to their report an official notice could come any day now. Although the exact number may not yet be known, let’s take a look at the signals we’ve been getting from the agency to date.

New Governmental Regulations

Although many at first assumed these regulations governed only the truck and the engine, the EPA has also added emission regulations for trailers, fairings and rolling resistance. According to one administration official, the unveiling will be a “big rule” that contains so many different components, it easily could be broken down into separate regulations by themselves.

While there is much anticipation of this new rule, it won’t actually go into effect for another four years. In 2011, the EPA outlined rules for vehicle model years 2014 – 2018. This new rule will govern vehicle model years “post-2018,” likely through 2027.

The government has reported that these changes will reduce petroleum consumption by more than 530 million barrels of oil and reduce carbon emissions by 270 million metric tons.

Current long-haul truck fuel economy averages are in the neighborhood of 5.5 to 6 miles per gallon (mpg). The 2011 rule pegged the standard to a 20 percent savings. The final number for later years is set to have heavy-duty commercial trucks increase their fuel economy by as much as 40 percent through 2027, when compared to 2010 levels.

These new heavy-duty truck rules are in addition to a bevy of hotly contested emissions rules the government is instituting for power plants, dubbed the Clean Power Plan. The president is using emissions reductions as a key final part to his second-term legacy-building efforts.

From Trucking’s Perspective

Fleets have been moving to greater efficiency for some time now. One truck from the 1970s belched out more carbon emissions than 67 of today’s trucks running at full throttle. While more can always be done, trucking wants to make sure jobs and commerce aren’t threatened by regulation.

As Owner-Operator Independent Driver Association (OOIDA) Representative Scott Grenerth pointed out, there are two main concerns that industry has regarding the rule. “The cost of the truck, and reliability of the truck – that’s the bottom line,” he stated.

After traveling to Washington, D.C. last month to meet with the White House budget office, Grenerth came away saying reliability and downtime for truck repairs were the focus. They also discussed a cost-benefit rule and how to mesh emissions goals with fuel economy standards.

Glen Kedzie, environmental counsel for the American Truck Associations (ATA), while saying he has no idea what the eventual rule will be, conceded that the EPA has done an extreme amount of outreach to win over industry insiders. In his own words it has been “a lot more than I have ever seen on a rule.”

Even so, Kedzie is not without reservation. These regulations are broad in their scope and carry major implications for the trucking industry.

“A truck is a mobile office,” he went on to say. “It’s a cog to keep this economy moving along. The EPA is dealing with this economic aspect here. They have to be careful not to make the standards cost prohibitive.”

Observers are suggesting that the EPA will take a bit longer than The New York Times posited to issue the new truck standards. As the trucking industry holds its breath, only time will tell what the final rule will be. When it hits, you can be sure we’ll report on it.

Will Trucking Turn Into Man Versus Machine?

It’s a time of upheaval for the trucking industry. The future of trucking is topic number one on the mind of industry insiders. Trucking has changed more in the past ten years than it did in the past 50 years combined, change that’s expected to accelerate.

New entrants are making their way into the trucking market. Sure, it may initially sound absurd to imagine companies with no manufacturing experience entering trucking, but at closer look, is it?

Old Game, New Players

There’s a monumental shift happening in the automotive industry. Unexpected new players are getting ready to enter the market in a big way.

It’s been known for years that Google is preparing driver-less cars. The rumor mill is abuzz with talk of Apple building a car. Then you’ve got Tesla, which is changing the way we power our cars, and perhaps our homes. And finally, with Amazon talking about delivering their products through drones, how might these technological leaps affect trucking?

Go to any trucking industry meeting and you’ll hear someone grumbling about the burdens of technology. From e-logs, to exhaust treatment systems, to electronic control modules, there’s a lot for manufacturers and motor carriers to think about.

Big Tech and Trucking

It’s true, as we’ve been reporting: technology is changing the face of trucking. The commercial trucks of today are extremely advanced and represent the cutting edge in automotive innovation.

That being said, it’s no secret that for decades the big three car companies and other big industry car and heavy truck manufacturers have been dominant in the vehicle and transportation industries. When high technology represented a basic combustion engine and four wheels, these were the industry juggernauts.

Today, thanks to entrenched bureaucracies, decades of declining research and development budgets, and crippling recessions, the big vehicle manufacturers have lost much of their edge. Business costs and old business models have robbed the heavy vehicle manufacturing industry of the imagination it once relied on to produce truly compelling products.

Though the huge tech companies of today increasingly see traditional manufacturers as ossified and out of touch, truck drivers, carriers and manufacturers still have plenty of life left. Branching into a new industry, no matter the money and resources available, is a risky and not always successful undertaking for any business.

A Technological Revolution

The car and truck manufacturing industry’s concept of developing, marketing and selling consumer and commercial vehicles has been static since the 1950’s. While this model worked great absence rapid technological innovation, it’s been losing steam in today’s rapidly changing society.

Today’s commercial vehicles are evolving, and tech companies understand that the transportation network of tomorrow is going to look completely different from the one of today. How will driver-less cars affect the trucking industry, for instance?

To put it in perspective, consider that truck fleets of today are talking about finding drivers while Amazon debates delivering packages directly to the consumer’s door via drone. As internet sales continue to explode, it’s not too hard to imagine a world where fully transparent, real-time, automated delivery systems are taking trucks off the road. But what would that mean?

Man versus Machine

Large manufacturing and trucking industries provide millions of good paying American jobs. Recent estimates put the number of truckers in the U.S. at 3.5 million. The total number of people employed industry-wide tops 8.7 million jobs.

The market disruption that would come from complete automation would be potentially devastating. For this reason alone it’s more likely these technologies will be phased in over time, and in harmony with the existing system.

Tech companies understand better than anybody else the commerce-altering potential of the systems they’re working on. As they look at our existing transportation technology, they’ll need to make ethical decisions that affect lives, and understand that there’s room enough for everyone in an evolving supply chain.

Even though the technological revolution is already showing itself as a major disruptor in other industries, trucking is firmly in place for now. And though companies like Apple, Google and Amazon don’t appear to be replacing trucks and truck drivers anytime soon, complacency is not the answer. Trucking should prepare for the technological revolution.

Fleets Set Their Sights on Laid Off Oil Workers

U.S. oil-company job cuts are costing skilled workers their jobs.  Though unfortunate, this is proving to be a boon for trucking companies desperate to fill big-rig driving positions. Many of these workers come already equipped with a commercial license and experience in operating heavy machinery.

These workers are more accustomed to being away from home for longer periods of time due to the remote nature of oil work. Adjusting to being on the road rather than the rig isn’t difficult for hardy energy workers.

The Rise of Trucking

These career transitions are ones that the trucking industry would like to see repeated. As the employment squeeze drags on, fleets are looking for innovative ways to keep their payrolls filled and their operations running smooth.

A resurgent U.S. economy has increased demand for cargo shipments and spiked competition for capable and experienced workers. Mass firings in the Bakken oil fields amid the plunge in crude markets are helping companies take the pressure off of an estimated 35,000 long-haul truck driver deficit.

Bob Costello, chief economist for the American Trucking Associations (ATA) reported “that there are a lot of happy truckers out there except for one issue, and that’s the truck-driver shortage.”

He went on to state that the difficulty these companies are having in meeting their obligations could result in some interesting industry migrations. This serendipitous timing masks the fact that attracting and retaining truck drivers is one of the biggest problems motor carriers have. In some areas annual truck driver turnover tops 100 percent, according to Bloomberg Intelligence analysts.

Some oil-and-gas industry veterans have already started to fill up the truck driver academies at Swift Transportation, reported Chief Executive Officer Jerry Moyes on a January 29 conference call. Other groups reporting big spikes from laid-off energy workers include Covenant Transportation Group and Celadon Group.

The Fall of Oil

If oil prices remain precipitously low, the global oil industry is expected to axe at least 50,000 more jobs than have already been cut. Over-the-road trucking jobs could see a bump of anywhere from 10,000 to 12,000 filled jobs.

Oilfield-services company Schlumberger Ltd. has cut 9,000 jobs and is estimated to cut another 7,000 positions this quarter alone. Halliburton, the world’s largest provider of hydraulic fracturing services, announced two weeks ago that it will cut as much as 8 percent of its 80,000 strong global work force this year.

Being away from home has been a drag on trucking companies’ ability to meet their recruiting goals, especially those that make the longest hauls and pull freight from just one consumer. Truck driver shortages are so longstanding that many analysts don’t estimate any big breaks from tradition anytime soon, even with the recent layoffs in the energy sector.

That’s why many motor carriers aren’t expecting a huge payoff in their recruiting goals. The expectation is for more of a slow trickle. It’s more likely the industry won’t see the benefits until the second half of the year. This will be when former oilfield employees who don’t have a commercial license complete the typical four to eight week training courses.

Money Makes the Terms

As the fortunes of one industry fall, others rise. While there’s friction in any sort of job change, this type of competition has been going on for a long time.

As domestic exploration and energy production surged in the past years, the trucking industry faced heavy competition for truck drivers and skilled technicians. Oil companies could offer lucrative, short-haul jobs that afforded employees more time at home with friends and family. During those times the revolving door went the other way.

Then after crude prices fell by half to around $50 last month, oil companies began to slash spending by up to 40 percent. A recent tally of working oil-drilling rigs has dropped by more than a third since October of last year. They’re currently at their lowest level since July of 2011.

As rising and falling tides affect industry boats, these cyclical employment transitions will continue. At least for now, the trucking industry will be providing a welcome buffer to those chopped from the energy sector, and everyone’s happy about that.

The History of Overland Commerce, Part One: The Early Days of Trucking

Over the next several weeks here at the QuickTSI Blog, we’re going to take an in-depth look at the history of overland transportation in this country. Our specific area of focus will be on commerce and the cross-country or regional transportation of goods and services.

Here is a primer of the topics we will be bringing to you in our three-part series:

  • Part One: The Early Days of Trucking
  • Part Two: The Modern Day Trucking Industry
  • Part Three: The Trucking Industry of the Future

So why is the topic of overland transport important enough to merit its own series? We respond to that question with one of our own: Is not the very structure of capitalism in this country built upon the concept of people trading goods and services?

One could even say the idea of inter-party commerce is part of human nature; that it goes all the way back to a time when our cavemen ancestors traded crude stone tools for food and shelter. Men and women have always been traders, and what we trade can’t always be carried on our backs.

For thousands of years we had relied upon primitive methods of transportation, mostly based around horses, camels, elephants and other beasts that could bear a burden. As civilization advanced, however, the need for more powerful modes of transportation became not just a luxury, but an imperative.

Then a century ago everything changed. Let’s take a look at how that change came about and what the history of over-the-road transportation in this country looked like in the early days.

Before There Was Trucking

In the nineteenth century, before motor trucks, but after pack animals, the bulk of overland commerce was handled by rail. The mighty railroad industry had been the focus of technological innovation for a long time.

While trains are quick and efficient, they’re limited in scope. Trains are, for instance, unable to bring a pallet of goods straight to the loading dock. Trains are also hampered by where there are rail lines. No rail lines? No trains.

After trains came steam-powered vehicles, but these contraptions were large, unwieldy and impractical. It was these limitations of the time that forced the engineers of yore to develop technologies we now take for granted, such as suspension, steering, and braking. Being precise in one’s metallurgical skills also became key in blending metals to create strong and lightweight materials.

While these innovations were crucial to helping usher in the age of the automobile, large trucks used for transporting goods were still quite slow to establish their niche in the transportation market. This was mainly due to the lack of gear drives and advanced transmissions, which hadn’t yet been invented.

Despite a slow pace of technological innovation for the time, the first big trucking boom came during the prosperous, pre-depression, post-war 1920’s. This was a time when roads were improving and modern air filled tires replaced the heavy and inefficient solid rubber variety.

Manufacturers were also starting to introduce cabs as well, increasing a driver’s operating distance. Let’s remember that during that time a haul between New York and Philadelphia was considered quite a long trip.

Then just as things were picking up, the Great Depression hit the United States with all the force of a cannonball. While a number of trucking companies were forced out of business, those that survived experienced the next boom with the repeal of Prohibition and a reviving economy.

Trucking: An Industry Disruptor

It was in 1935 that Congress, seeing the signs of a rapidly expanding trucking industry, passed the Motor Carrier Act. The passing of this bill authorized the Interstate Commerce Commission to regulate the trucking industry and ended the legislative war that had been raging between rail and trucking interests for years.

The end of this war also signaled the impending demise of rail transport as the go-to method of moving goods from one part of the country to another. Between the depression and heavy competition from an industry that had more flexibility of movement, railway commerce was in decline. It wouldn’t be long before rail tariffs were seriously undercut by emerging trucking companies competing in the open market.

Ironically, even back then trucking interests were openly worried about what affect government regulations, specifically in the Motor Carrier Act, would have on their nascent industry. It’s interesting that here we are almost three-quarters of a century later asking the same questions.

With rail transport diminishing and transport by air not yet plausible from a business perspective, what was the next step for trucking? How did we get from where we were yesterday to where we are today? Stay tuned for the next installment of our three part series, The History of Overland Commerce, to find out!

The Essence of the Trucking Industry

The trucking industry plays an integral part of the economy.  The industry helps transport large quantities of finished goods or raw materials to and from manufacturers for retail distribution, sustenance to works in progress such as mining, construction of roads and buildings.  They also help ferry construction materials or waste, moving portable concrete mixers and many other indispensable functions.

The invention of trucks took place during World War I, prior to which goods were hauled via horse-drawn carriages or trains. However, an increase in paved roads witnessed the birth of the trucking industry in the 1930’s, prompting the introduction of safety regulations, driving hours, and the number of days a driver would operate a truck. An influx in freeway and highway networks linking cities across continents has contributed to the substantial growth of freight transportation via trucking, the current dominant force within the freight industry.

This vital freight tool which is paramount to the warehousing and manufacturing industry is governed by a set of rules and regulations which control the hours of operation and education requirements for drivers. Large trucks can only be operated by individuals who hold a commercial driver’s license and have undergone the relevant training and education, coupled with adequate handling capabilities knowledge in regards safety procedures while traveling within interstate routes. Transport bodies which govern the trucking industry in relation to freight have their own sets of regulations as proposed by the Department of Transportation.

Developments in computer technologies have upgraded the trucking industry via the use of tracking devices, the internet, satellite communication, and automatic transmission, within trucks. This has greatly improved the industry by enhancing the level of communication, productivity in the manufacturing industry with fewer empty mile coverage and waiting time between loads, exploration of new opportunities in sales and marketing, minimizing the driver’s effort and hauling time spent, while providing accessible entertainment to the drivers who spend most of their time ensconced within the trucks.

The introduction of bio diesel, a non-toxic biodegradable diesel fuel and a derivative of vegetable soybean oil (or recycled grease gathered from restaurants), has further contributed to the reduction of the greenhouse effect which was previously witnessed with diesel exhaust associated with sulfur and nitrogen oxide emission, both dangerous carcinogens. To further control the emission problem, truck drivers are being advised to avoid unnecessary engine idling to downgrade air pollution and preserve electricity within the driver’s cabin. The introduction of power shoring facilities via the electrifying of parking facilities has completely eliminated the need for driver’s to idle their engines, while the use of hydrogen fuel cells is being considered an option for the provision of clean silent power to appliances, when the trucks are parked.

A continuous increase in fuel price has prompted some companies within the trucking industry to implement the use of hybrid hydraulic or electric trucks, the former storing energy within hydraulic motors and tanks, while the latter using a power source of regenerative brakes and batteries. Both the hybrid versions are capable of saving 30 to 60 percent in fuel, in comparison to conventional vehicles.

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