News

Print

Best News for the Trucking Industry Has Nothing to Do With Trucking

on .

http://www.glgroup.com/News/Best-News-for-the-Trucking-Industry-Has-Nothing-to-Do-With-Trucking-52264.html
Analysis by: John Schulz
Analysis of: U.S. Factories Buck Decline
Published at: online.wsj.com

Summary

American manufacturing, long written off as a economic loser, is making a comeback. For the first time since 1997, the number of manufacturing jobs grew last year by 1.2 percent, of 136,000 new jobs. And it's not a one-shot deal. Economists are predicting a 2.5 percent gain, or 330,000 new manufacturing jobs, this year.

Analysis

This may be the best thing to happen to the trucking industry since economic deregulation in 1980. The number of net U.S. manufacturing jobs increased last year for the first time since 1997. Manufacturing jobs grew by 1.2 percent, of 136,000 jobs, and that growth is expected to more than double this year. As one who has never bought into the Great Globalization Theory, I welcome this news. And so should everyone connected with the trucking industry.

These are jobs that will directly affect freight volume, and thus rates and profitability, in the industry. As the offshoring craze begins to show cracks -- anybody else had an offshore call center experience worthy of "Saturday Night Live?" -- U.S. manufacturers are beginning to see value in keeping plants here.

Economists for Moody's Analytics and IHS Global Insight insist this is not a one-shot deal. They expect this trend to continue at least for the beginning of this decade.

Ford, Caterpillar,  and Whirlpool are some of the names taking advantage of tax breaks, excess capacity and infrastructure and other built-in advantages of employing a U.S.-based work force.

As trucking volume is roughly divided 50-50 by retail and industrial, any increase in industrial utilization in this country is good news for the big industrial truckload carriers such as Werner Enterprises, Schneider National, J.B. Hunt and many others. LTL firms such as beleaguered YRC Worldwide, Con-Way and FedEx Freight also figure to gain from this growth.

Of course, it will take more than a year or two of manufacturing increases to get the U.S. economy out of its doldrums. More than 144,000 factories -- that's factories, not jobs -- were lost during the George W. Bush administration. Manufacturing now accounts for merely 11 percent of U.S. total economic output, compared with 27 percent in 1950.

Entire domestic industries -- furniture and footwear come immediately to mind -- have been wiped out because of cheap labor and non-existent environmental regulations in places such as China.

With Chinese president  Hu Jintao in the Nation's Capital for talks with President Barack Obama, I would like to submit a question to his excellency: there will be no U.S. middle class to buy your cheap Chinese-made goods if you continue your mutually destructive economic path. There, I said it.

http://www.glgroup.com/News/Best-News-for-the-Trucking-Industry-Has-Nothing-to-Do-With-Trucking-52264.html

Print

From Trucking.Com - We've got trucking covered

on .



1/18/2011
Economy, Trucking Looking Up for 2011
By Deborah Lockridge, Editor

A string of economic experts and industry analysts offered a more optimistic look at the economic and trucking industry outlook for 2011 -- albeit with some downsides -- during the annual Heavy Duty Dialogue event put on Monday by the Heavy Duty Manufacturers Association in Las Vegas.

The Great Recession officially ended in June 2009. "But a recession ending doesn't mean the economy is operating anywhere near a normal type of level," said Bill Strauss, chief economist with the Chicago Federal Reserve. "In a technical sense, the words we would use is the economy still stinks."

Actually, when measured by Gross Domestic Product, the economy has been growing at a pretty good clip -- 3.2 percent growth over the last four quarters which is above the trend growth of 2.5 to 2.75 percent. But "it doesn't FEEL like we're doing all that well," Strauss said. The main reason for that, he said, is that rebuilding of inventories accounted for 62 percent of that growth. "This is truly a story of the tail wagging the dog," he said, because inventories represent a fraction of 1 percent of GDP.

Inventories, he explained, are goods that are produced but not sold in the marketplace. If we remove the inventory number from GDP, that's called final sales. Final sales also normally trends to 2.5 to 2.75 percent, but it's only been growing at just over 1 percent. "Here you can see why it hasn't felt so good," he said. But he predicted that number will more closely match GDP growth in 2011 and 2012.

In 2011 and 2012, growth will accelerate somewhat, Strauss said. "But more importantly, it's going to feel better, for two key reasons." Number one, he said, the inventory bullwhip effect is probably coming to an end. Number two, he said, government stimulus is unlikely under the new Congress.

"But even with the pullback in inventory and government spend, we're going to be looking at growth that is going higher," Strauss said. "And that's why it will feel better."

The Fed's forecast is for GDP growth of 3.5 to 4 percent this year and close to 4 percent for the next couple of years. That is more optimistic than the Blue Chip Economic Indicators, a monthly survey of 50 forecasters. That consensus puts GDP growth at 3.3 percent through 2011 and about the same for 2012.

That's less than we've seen coming out of previous deep recessions, pointed out Eric Starks, president of FTR Associates, where 5 to 10 percent was more the norm. "We cannot completely discount history and say it won't be there," he said. "If that happens things get a little crazy."

Unemployment is expected to keep edging down, with the Blue Chip forecast projected for 9.1 percent by the fourth quarter of 2011 and 8.4 percent by the end of 2012.

The Manufacturing-Led Recovery

The one sector of the economy that has been the true growth sector is manufacturing, Strauss said. Manufacturing has been expanding for 18 months - and it has not been slightly above trend, it has been well above trend, growing at a 7.8 percent annual rate. The sector has recovered 56.6 percent of what it lost during the recession, and by second quarter of 2012 should have recovered all of that and will again be looking at record numbers.

Looking at industrial output numbers from December 2007 to June 2009, Strauss noted that the two that fell the most were motor vehicle/parts and primary metals, which kind of go hand in hand. "But much like a tennis ball, the industries that fell the worst are the two sectors that are leading the way" in the recovery. "You're seeing spectacular increases."

The relatively better performance of manufacturing is expected to persist over the next couple of years, Strauss said, although perhaps not quite so drastically. The Blue Chip forecast puts industrial production rising 4.1 percent through 011 and 3.8 percent in 2012. Strauss said he's optimistic it will be even higher.

And, of course, manufacturing is an important figure for trucks, as the services portion of the economy can't exactly be transported on a truck.

Manufacturing was also cited as a strong economic figure by Donald Broughton, partner with Avondale Partners, citing the Institute for Supply Managements's Manufacturing Business Survey, ISM's Purchasing Managers Index was at 57 percent for December. (A PMI reading above 50 percent indicates that the manufacturing economy is generally expanding.)

"I generally don't like confidence indexes because they tend to be squishy," Broughton said. "It's all about feelings. Except purchasing managers. When I ask them how they feel and they say they feel good, it means they're signing POs. So there's a strong correlation with truck tonnage." However, he notes, it's only good for short-term predictions. After a month or two the accuracy drops off.

The capacity question

Much has been made of the issue of capacity coming out of the industry thanks to trucking bankruptcies, truck exports and other factors.

Broughton pointed out that during the previous recession, 11 percent of gross capacity was taken off the road by bankruptcies. But the remaining players added trucks, bringing the next capacity reduction to only 7 percent. By contrast, in this cycle, trucking failures took 12 percent of gross capacity off the road - and the remaining players cut the size of their fleets, bringing the net capacity reduction to 15 percent.

Equipment is not the only factor in capacity, however. Those truck must have drivers in order to haul freight. As Starks said, "the looming driver shortage keeps getting delayed, but it is only a matter of when." The Federal Motor Carrier Safety Administration's new CSA enforcement program and proposed changes to hours of service will have a negative impact on the number of available drivers.

"The most important thing is fleets are not looking to add capacity," Starks said. "They are using current units and searching for more 'desirable' freight." While truck orders are picking up, he said, they are to replace aging equipment, not to enlarge the fleet.

FTR measures "active capacity" - the number of trucks out there actually looking for a load, not the trucks parked against a fleet's fence or on a used truck lot. "We're sitting at about 95 percent utilization of active capacity right now," Starks said. "And as we get into the middle of the year, the system is going to hit 100 percent capacity."

Fleets will be less likely that in the past to just go out and add equipment to expand the fleet, Starks said. Those turcks are just more that can be penalized by CSA. And if you don't have a driver for that truck, you're not going to buy a new truck.

However, Broughton said he doesn't believe that pricing will improve as much as some analysts have predicted as a result of this tightening capacity. Yes, rates will go up, he said, but he thinks predictions of 15 percent or more by the second quarter of 2011 are unrealistic.

And margins will be flat despite higher rates, Broughton said, because utilization is going down thanks to the government's new CSA program and proposed changes in hours of service, but costs are going up for fuel, labor, equipment and more.

Starks responded in a later presentation to Broughton's comment, saying FTR expcts to see a 10 to 15 percent increase in rates. "Does that mean that's all profit? No! We're going to see costs go up 10 percent or more, so their profit margins are going to continue to get squeezed."

Starks also pointed out that freight is the most important indicator to be watching in order to understand the recovery. "What we've seen is that freight had flattened out over the last six to nine months, but we see things are going to start picking back up." In fact, Starks predicts a 3.5 to 5 percent growth in freight over the next several years, which is significantly higher than the usual rate of around 2 percent. However, it will still take a lot of growth after such a large downturn to get us back to the peak freight levels we saw in 2006, he said.

Finding Drivers

One of the most critical factors for trucking companies in 2011 and 2012 will be the ability to find drivers and owner-operators, Broughton said. "That will be the single biggest differentiating factor between trucking company A and trucking company B," he said.

Starks said the hours of service changes could result in a productivity drop of as much as 6 percent. "That means we would need another 150,000 trucks on the road overnight to move the same amount of freight."

Between the new regulations and a pipeline issue - the ability for trucking companies to actually bring people in, hire them and put them in a truck - the industry could be facing a peak shortage of 600,000 drivers.

"Let's say fleets increase their productivity, so the driver shortage gets down to 400,000 - that's twice as bad as what we saw in 2004."
In order to deal with it, Starks predicts we could see more drop and hook freight and increase in demand for trailers as trucking companies try to keep their tractors as productive as possible despite reduced driver hours and drivers available.

Broughton said he likes to follow over-the-road truck driver pay as a predictor of unemployment. That's because there is a part of the economy that views driving a truck as a last resort. "So when I talk to trucking companies and they say their recruiting department is finding plenty of great drivers, I sell all my truck stock and get into a fetal position in the corner of the room, because that the plant went from three shifts to two, or it means the construction job finished and there wasn't another one to go to."

On the other hand, he said, when you have to start paying more for drivers, it means unemployment is going to start coming down. "As long as truck driver pay is going up, I'm confident unemployment will keep going down."

Buying Trucks

"Things are definitely turning around in the Class 8 market," Starks said. FTR predicts 201,000 in truck production for 2011 and 258,000 for 2012. Trailer orders are accelerating, as well, and FTR has upped its forecast over the last several months to reflect higher order activity they're seeing. Their current forecast is 170,000 trailers this year and 220,000 for 2012.



Print

U.S. Xpress places order for 1,000 Peterbilt Model 587 tractors

on .

http://www.ccjdigital.com/u-s-xpress-places-order-for-1000-peterbilt-model-587-tractors/
By CCJ Staff
Published January, 18 2011

Peterbilt Motors Co. announced it has received an order for 1,000 Model 587 SmartWay-certified trucks from truckload carrier U.S. Xpress Enterprises. Peterbilt says the new Model 587 features a number of aerodynamic enhancements, technological and safety innovations and serviceability improvements for maximum performance.

Headquartered in Chattanooga, Tenn., U.S. Xpress Enterprises provides a wide variety of transportation solutions throughout North America and is committed to minimizing its environmental impact by being a U.S. Environmental Protection Agency SmartWay Transport Partner. The company says it also is dedicated to being at the forefront of safety compliance, using comprehensive training for its staff and drivers and ensuring its trucks feature the latest safety innovations.

The new Model 587 has earned the Environmental Protection Agency’s (EPA) SmartWay certification... Continue to read more.

Print

Annual Fast-Fax Year in Review: Part Two

on .

DOT Safety Regulation Update Fast-Fax™
Week of January 3, 2011
Foley Services Your Single Source for DOT Compliance

This special issue of Fast-Fax continues our annual recap of the regulatory changes issued by the Federal Motor Carrier Safety Administration in 2010.

After December’s excitement and FMCSA’s sudden burst of activity (CSA, hours-of-service) Fast-Fax will resume its annual recap of the regulatory changes issued in 2010. This week’s is­sue covers the industry changes published between July and De­cember 2010.

July

FMCSA Takes Aim at the State Drivers’ Licensing Agencies With Two New Notices

FMCSA issued a notice in the Federal Register stating that they were working on a unified security system. The second no­tice gave guidance to the SDLAs to help them report convic­tions for driving offenses and CDL disqualifications that occur in states other than the state where the CDL was issued. The guidance covered a huge num­ber of topics and programs.

2010 Roadcheck Results; Enforcement and Compliance Continues Despite Weakened Economy

CVSA released the results of the 2010 Roadcheck event. The press release praised the con­tinued enthusiasm for the event despite the economic hardships facing states and provincial partners.


August

Part 40 Changes Introduce Test­ing For Ecstasyand Mandatory Initial Testing For Heroin, and Lowers the Cut-Off Levels For Cocaine and Amphetamines

The DOT released a highly antic­ipated Final Rule explaining the changes to its drug and alcohol testing program.

Alabama Carrier Ordered to Cease Operations Two Months After Fatal Crash

A March 2010 accident trig­gered a FMCSA investigation that uncoved a variety of serious safety violations at the 26-driver company. A shutdown order fol­lowed on June 5.


September

FMCSA Makes Several Requests to Change On-Going Informa­tion Collection Activities

Information collection activities ranging from training certificates to hazmat safety permits may be changed following FMCSA’s re­quests.

DOT Finalizes Ban on Texting While Driving a Commercial Mo­tor Vehicle

Banning texting while driving, an issue that became a personal quest for Secretary of Transpor­tation Ray LaHood, reached an­other milestone as the Secretary personally announced the Final Rule banning texting while driv­ing a Commercial Motor Vehicle (CMV).


October

NTSB Concludes That Driver Fatigue Turned a Minor Incident Into a Horrific Crash

NTSB is calling for FMCSA and NHTSA to develop standards and rules for collision warning systems on new commercial vehicles to reduce fatigue-related accidents and other recommendations.

FMCSA Delays CSA2010 Implementation, Offers Motor Carriers a Preview of the New System

FMCSA was forced to delay im­plementation of CSA2010. Carri­ers were forced to wait until late December before the compli­ance monitoring system (later renamed CSA) was rolled out.


November

Last-Minute Changes to CSA2010 Announced

FMCSA Recalibrated the Cargo- Related BASIC by adjusting the cargo securement violation se­verity weightings based on in­put from subject matter experts. It also modified the public dis­play to show the SMS Cargo-Re­lated BASIC violations only. The percentiles and intervention status are not on public display.


December

CSA Makes Its Public Debut

After countless stumbles and delays, FMCSA opened its CSA2010 (now known as CSA) database to the public on De­cember 12. The general public was given access to carrier in­formation in five of the seven Behavior Analysis and Safety Im­provement Categories (BASICs) through FMCSA’s CSA portal at http://ai.fmcsa.dot.gov/sms/.

HOS Proposal Finally Hits the Federal Register

FMCSA’s Notice of Proposed Rulemaking (NPRM) hit the Fed­eral Register in late December and for 60 days (until February 28, 2011) the agency is accept­ing comments that could help shape the Final Rule.

Please send an email request to This email address is being protected from spambots. You need JavaScript enabled to view it. if you would like us to send you a PDF copy of the proposed rule.


Editor: Roxanne Swidrak, Vice President, Operations • 1-800-253-5506 • www.FoleyServices.com • Vol. 111, No. 668 • © Foley Carrier Services, LLC. 2010

Print

We've Got Stars in Our Eyes!

on .

Yes, we've got stars in our eyes: four and five stars. That's the kind of reviews that we're getting for our latest release, BUMPER TO BUMPER ® Easy CDL, an app for the iPhone.

Easy CDL recaps all the topics that applicants must study to pass the Commercial Driver's License Test, including the Endorsements, and offers 430 practice multiple-choice test questions. The answers to the test questions are included in the app as are explanations as to why those answers are correct. According to reviewers, the audio "lecture" that accompanies each of the 13 units makes prepping for the CDL tests more enjoyable. It's a great supplement to a formal training program. Students at even the best truck driving schools might appreciate a little extra review and opportunities to practice with the sample test questions  so we've attached a poster about it. Download the poster and hang it in the classroom to let your students know about this resource. And it's a great tool for CDL holders who want to add Endorsements to their license.

BUMPER TO BUMPER ® Easy CDL is for the iPhone, the iPod and the iPad. Look for BUMPER TO BUMPER ® Easy CDL in the iTunes store or go to Study By App on the Internet. We'd love to hear your reactions and, like others who have downloaded the app, you can also leave your comments right on the iTunes Easy CDL page.

We also wrote another short "how to" story about testing trailer brakes for www.ehow.com. We'll be doing more stories like this in the future.

If you have any questions or would like more information about any of the above, don't hesitate to call us at 361-749-4007 or send an email to This email address is being protected from spambots. You need JavaScript enabled to view it. . Check our Web site www.bumper2bumpertruckbook.com, or our blog at www.cdlbookblog.com. Just go to the Free Stuff page and click on the orange-and-white RSS Feed logo to subscribe. You can leave comments or suggestions there, too. And, follow us on Twitter at http://twitter.com/redwritertx for updates.
Print

HOS Proposal Finally Hits the Federal Register

on .

DOT Safety Regulation Update Fast-Fax™
Week of December 27, 2010
Foley Services Your Single Source for DOT Compliance

Carriers, drivers and other interested parties have until February 28 to submit their comments on FMCSA’s proposed revisions to the Hours-of-Service rules.

Safety advocates and big industry associations started weighing in on FMCSA’s new Hours of Service (HOS) proposal shortly after the preview copy appeared on the agency’s website on December 23. Now it’s your turn to get involved in the conversation.

FMCSA’s HOS Notice of Proposed Rulemaking (NPRM) hit the Federal Register on Wednesday and for 60 days (until February 28, 2011) the agency is accepting comments that could help shape the final rule. In this issue we will be discussing the highlights of FMCSA’s proposal. Please send an email request to This email address is being protected from spambots. You need JavaScript enabled to view it. if you would like us to send you a PDF copy of the proposed rule.

Driving Time Question Remains Unanswered

The long wait for the Hours-of-Service NPRM may be over, but the driving time question remains. In its proposal, FMCSA is recommending limiting drivers to either 10 or 11 hours of driving time after at least 10 consecutive hours off duty. Currently, the agency said, it is leaning toward reducing drive time to 10 hours. The only good news here is that the 9-hour driving limit, which was discussed as a possibility, appears to be off the table.

To help determine the driving time mandated in the forthcoming HOS rule, FMCSA is seeking data on fatigue-related crashes, the economic impact of a 10-hour vs. 11-hour driving limit, and how much driving is actually done between the 10th and 11th hours.

Proposal Adjusts Driving Window

The agency is proposing a standard driving window of 14 hours. Therefore, if the proposal becomes a final rule drivers will have 14 hours after coming on duty to complete their 10 or 11 hours of driving (depending on which driving limit FMCSA settles on).

If you think that seems too simple for a Federal regulation, you may have a future at FMCSA. The agency has also proposed to limit the actual on-duty time during that 14-hour driving window to 13 hours of onduty time. As such, drivers will be required to take at least one hour of break time during the standard driving window.

In another interesting twist, FMCSA is proposing an option that would allow drivers to extend their daily shift twice a week. Any time worked over 14 hours would count as an extension. As proposed, the extension does not extend a driver’s 13 hours of duty time. Any driver who would want to take advantage of the 16th hour would need to take 3 hours of off-duty time during the standard driving window. The definition of on-duty is being tweaked to allow drivers to count some of the time spent parked in their trucks as offduty hours.

Mandatory Breaks for Drivers

The proposal also introduces a 30-minute break requirement for drivers. Upon reaching the 7th hour after coming on duty, the driver may remain on-duty, but cannot resume driving without taking a 30-minute break. For example, a driver who opts to take a half-hour break 4 hours after coming on duty will need take another break no later than 11.5 hours after coming on duty to continue driving.

New Limits to the 34-Hour Restart

FMCSA is also proposing two new limits to the 34-hour restart. The goal of these changes is to reduce safety and health impacts that result from long weekly hours, according to the agency.

First, any 34-hour or longer period used as a restart must include two consecutive off-duty periods from 12 a.m. to 6 a.m. This requirement is less of an issue for daytime drivers since their schedules allow them to get two nights of sleep in a 34-hour period. However, a driver with a night-time driving schedule would be required to spend an extra day off duty to meet the restart requirement and maintain their night-time driving schedule. The issue, according to FMCSA, is that night shift workers have a tendency to switch to a regular night-time sleeping schedule during their days off. As a result, many night drivers are only getting one night of restorative rest before beginning a new “work week.”

The second limit would allow drivers to begin only one restart during a 7-day period. So, regardless of when they meet their maximum driving time for a given week, they will not be able to begin their 34-hour restart until 168 hours after the previous restart. Imagine a driver ends a work week and begins the 34-hour restart at 6 p.m. on Friday. The earliest he could return to duty would be Sunday at 6 a.m., and the earliest he could begin the next restart would be 6 p.m. the following Friday. If the driver runs out of weekly hours at 3 p.m. on Friday, he cannot include the time between 3 p.m. and 6 p.m. as part of his 34-hour restart. The three hours would simply be counted as off-duty time.

How to Comment

FMCSA is currently accepting comments online at www.regulations.gov as well as via fax, mail and hand delivery. Be sure to include the docket number (FMCSA–2004–19608) on all comments. Also, indicate the specific section of the NPRM that the comment addresses as well as the reasoning behind each comment or suggestion. All comments will be posted at www.regulations.gov.

Editor: Roxanne Swidrak, Vice President, Operations • 1-800-253-5506 • www.FoleyServices.com • Vol. 110, No. 667 • © Foley Carrier Services, LLC. 2010

 

Print

Access Has a New Weapon in the War Against Driver Turnover

on .

We are proud to announce

Access Has a New Weapon in the War Against Driver Turnover

In response to the never-ending question “What can we do to retain and motivate our company’s most valuable asset, our drivers?” Access has an answer:

Make them really feel like a part of your company “family” by providing a newspaper with them as the focus!

Features and photos covering:

  • Personal announcement (births, anniversaries)
  • Professional accomplishments (awards or other recognition)
  • Over-the-road related human interest and lifestyle articles
    And much more!

Call 888.242.6140 now and we’ll produce your first issue (approx. $3,000.00 value) FREE!*


*Offer good through February 28, 2011; some restrictions apply.

Print

California delays diesel emission rules till 2014

on .

Find more articles at Fresnobee.com
By Rick Daysog - This email address is being protected from spambots. You need JavaScript enabled to view it.

The state's construction and trucking industries will get more time to comply with stringent new diesel emissions regulations.

Citing the sluggish economy, the California Air Resources Board on Friday voted unanimously to push back the implementation of the new rules by four years to 2014.

"What the board was trying to do today is to balance the needs of our citizens for cleaner air … and to come up with something that provided meaningful relief to an industry that has been hard hit," said Mary Nichols, the board's chairwoman.

The rules require businesses to retrofit existing trucks, bulldozers, front loaders and other heavy equipment to lower diesel emissions.

The delay was opposed by environmental groups and clean-tech advocates, but the trucking and building industries applauded the board's decision.

Michael Kennedy, general counsel for the Associated General Contractors of America, said... Read more
Print

Rule to Ban Hand-Held Cell Phone Use

on .


WASHINGTON - As part of its campaign to put an end to the practice of distracted driving, the U.S. Department of Transportation today proposed a new safety regulation that would specifically prohibit interstate commercial truck and bus drivers from using hand-held cell phones while operating a commercial motor vehicle (CMV).

"Every time a commercial truck or bus driver takes his or her eyes off the road to use a cell phone, even for a few seconds, the driver places everyone around them at risk," said U.S. Transportation Secretary Ray LaHood.  "This proposed rule will go a long way toward keeping a driver's full attention focused on the road."