A panel of economists painted a bleak outlook for the near future Oct. 22 at the American Trucking Associations’ annual Management Conference and Exhibition in Orlando.
Because of a slumping housing market, a rebound in trucking will take longer than previous forecasts, probably arriving in the second half of 2008, said ATA Chief Economist Bob Costello. “When things turn around, it will be very quick,” he added.
Costello said freight tonnage, down 2.2 percent from last year, is in a “recession environment.” Overall loads are flat.
Costello said while there are other factors keeping freight soft, “the housing market is the No. 1 reason tonnage is down.”
Nigel Gault, Global Insight’s group managing director for the North American Macroeconomic Service, said that because of housing woes and a tighter credit market, the U.S. economy will slow to 1.5 percent growth for the rest of the year and less than 1.5 percent growth during the first months of 2008. He added consumer spending is expected to be slower than normal during the holiday season.
The housing slump is a “downturn of historic proportions,” Gault said. “There is a bloated supply of houses – in the area of 8 to 10 months’ supply on the market. I see the housing market to continue downward, bottoming out in the first half of 2008. It still has a long way to fall.”
Gault said he expects the Federal Reserve to cut interest rates as many as two more times before the end of the year.
“Still, I place the odds of a recession at about 30 percent,” Gault said. “What helps is a strong global economy.”
National Association of Manufacturers Chief Economist David Heuthers said one positive result of the weak U.S. dollar has been stimulation of the U.S. export market.
Another positive note amid the gloom, Costello noted, is that the driver shortage has eased.
The panel was moderated by FoxNews Business Correspondent Stuart Varney.
– Randy Grider
Hours of Service, Driver Shortage Top Concerns of Fleets
Hours-of-service regulations and the driver shortage are the two biggest concerns of fleet managers, according to a study conducted by the American Transportation Research Institute and released at the American Trucking Associations’ annual management convention.
The survey was based on responses from more than 5,000 trucking executives. Other top 10 issues included fuel issues, congestion, government regulations, tolls and highway funding, tort reform and legal issues, driver training, environmental issues and onboard truck technology.
ATA plans to use the survey’s findings to help steer its policy initiatives. The full report, “Critical Issues in the Trucking Industry – 2007,” is available online at www.atri-online.org. The survey also outlines strategies that could be employed to help address each of the concerns identified.
– From Staff Reports
Pennsylvania Moves Closer to Tolling I-80
Pennsylvania turnpike and state transportation department officials said they signed a 50-year lease agreement in October allowing tolls on Interstate 80.
The Pennsylvania Department of Transportation and the state turnpike commission also filed a formal application with the Federal Highway Administration Oct. 13 seeking federal authorization to toll and improve I-80.
Commission spokesman Carl Defebo said they expect to receive federal conditional approval before 2008 that would allow them to proceed with environmental and engineering studies. The commission hopes to collect the first tolls in 2011.
The Owner-Operator Independent Drivers Association said that the organizations are rushing to sign a contract the public didn’t first see.
“At the very least, it’s blatantly unethical on their part,” said Todd Spencer, OOIDA executive vice president. “And it may be totally illegal.”
Signing this lease would violate the FHWA’s General Pilot Program Provisions, the association stated.
Tolling I-80 is the result of Act 44, a comprehensive transportation funding plan signed into law in July. I-80 tolls would first pay for maintenance and reconstruction on the interstate, freeing up tax revenue to improve roads and bridges.
Under Act 44, the commission will transfer $83.3 billion to PennDOT for transportation projects. The commission has said it will generate an additional $33 billion over the next 50 years for I-80 improvements and other transportation projects, bringing the total investment to $116 billion.
Tolls on the 311-mile interstate will mirror existing turnpike per-mile rates. If tolls start in 2011, it would cost a car $25 to drive across the state while an average tractor-trailer truck would pay $100 for the trip. E-ZPass users will pay less.
The act enables a 25 percent toll increase in 2009 on the mainline turnpike and a 2 to 3 percent increase on that turnpike in 2010.
Officials plan $2 billion in I-80 in improvements, such as lengthening on and off ramps at interchanges, building truck-climbing lanes and raising some low-clearance bridges that now force trucks off the highway.
– Jill Dunn
California to Triple Idling Fine
Beginning Jan. 1, California will triple its idling fine and prevent registration of trucks with outstanding citations for pollution.
Gov. Arnold Schwarzenegger signed the Healthy Heart and Lung Act, AB 233, into law Oct. 15. It also directs the California Air Resources Board to develop a comprehensive plan to enforce diesel regulations for all vehicles and engines. Diesel particulate matter is responsible for 70 percent of the cancer risk associated with breathing California air pollutants, according to state officials.
The state’s previous minimum civil penalty for violating the state’s five-minute idling law was $100, but beginning Jan. 1 it will be $300. Democrat Assemblyman Dave Jones, the bill’s sponsor, said the new law would bring the penalty in line with other traffic violations.
This law also requires state officials to refuse registration, including the renewal or transfer of registration, if the vehicle has been involved in a violation of air-pollution laws, whether by the owner or an operator, until the violation is cleared.
Every three years, CARB will be required to review the enforcement of diesel emissions regulations and develop a plan for consistent, comprehensive and fair enforcement. CARB must submit its first plan by 2009.
The California Trucking Association supported the bill, including an earlier provision deleted in September that would have barred state registration of pre-1994 trucks.
– Jill Dunn
New TV Series Gives Truckers a Makeover
CMT already has one hit series that gives makeovers to trucks. Now it’s launching a new series that gives makeovers to the truckers themselves.
Though it’s from the producers of “Trick My Truck,” the format of “Trick My Trucker,” which premiered Nov. 10, is more like that of TLC’s “What Not to Wear.” On each episode, trainer Aaron Aguilera and stylist Harmonie Krieger will “ambush” two truckers and challenge them to shape up, adopt healthy diet and exercise habits and generally change their images. In the finale of each episode, the truckers will present their “new” selves to family and friends and compete for thousands of dollars in cash and prizes.
Contestants on the six-episode series include:
More information on the show is posted at the CMT website, www.cmt.com.
– Andy Duncan
FYI | News Briefs
Freightliner LLC Changes Name
Freightliner LLC announced Oct. 5 that its corporate name would change to Daimler Trucks North America LLC, effective Jan. 7, but operations, structure, brand strategies and dealer and supplier relationships would not be affected. A new Daimler logo was unveiled Oct. 4 in Stuttgart, Germany. Freightliner LLC included Detroit Diesel engines, Sterling and Western Star trucks, Mercedes-Benz engines and transmissions and Thomas Built buses.
Illinois Keeps Split Speeds
The Illinois Legislature failed to override Gov. Rod Blagojevich’s veto of a bill that would have raised the speed limit for trucks on rural highways to 65 mph, the same as four-wheelers. The House voted 57-53 Oct. 10 to override the veto, but failed to get the required three-fifths majority. The Senate voted to override the veto the same day.
Two More States Require E-manifests
All truck carriers now are required to submit manifests electronically to U.S. Customs before arriving at Maine and Minnesota land border entry ports. The e-manifests detailing cargo and carrier information became mandatory at these ports Oct. 16.
On Dec. 16, Customs will begin to deny admittance to any carrier that arrives without submitting or attempting to submit an e-manifest.
Navistar Interested in GM Medium-Duty
Navistar International said Oct. 25 it was in advanced discussions with General Motors to buy the Detroit automaker’s medium-truck unit and predicted an agreement soon. Talks with GM could result in a memorandum of understanding between the two companies within “a short period of time,” Navistar Chairman, President and CEO Daniel C. Ustian told reporters during a conference call.
U.S. Truck Rally
The U.S. Truck Rally, May 10-11, 2008, at the Interstate Center in Bloomington, Ill., includes a truck rodeo and business seminars.
Admission is free.
The primary goal of the U.S. Truck Rally is to help owner-operators and small fleets operate compliant and profitable trucking businesses.
The Interstate Center is off Exit 160 from I-55/74. For more information, visit www.ustruckrally.com.
Goodyear Primary Supplier for International
Goodyear commercial tires now are available for specification on all International Truck and Engines vehicles. Goodyear says it has been named an International primary tire supplier.
Goodyear’s fuel-efficient Fuel Max Technology tires and self-sealing DuraSeal mixed-service tires are eligible for selection by International customers. The company’s Fuel Max tires are standard equipment on the International ProStar family of tractors.
SelecTrucks Launches First-Time Buyer Plan
Used-truck retailer SelecTrucks has debuted a new financing product customized to meet the demands of first-time used truck buyers. With a down payment of $1,000, first-time buyers of eligible used trucks will receive competitive finance terms and low monthly payments, the company says.
Customers also will receive an enhanced 24-month/200,000-mile warranty, 24 months of bookkeeping and tax preparation services, GAP insurance to cover the investment in the event of a major loss, and roadside assistance.
Cummins Earns J.D. Power Award
Cummins Inc. has earned a customer satisfaction award in the J.D. Power and Associates 2007 Heavy-Duty Truck Engine/Transmission Customer Satisfaction Study.
Cummins received the award for highest customer satisfaction with heavy-duty diesel engines in the “vocational” segment. The Cummins ISX and ISM make up almost all of
the Cummins engine models in this segment.
Detroit Diesel unveils DD15
After nearly five years and $1.5 billion in development, the new heavy-duty Detroit Diesel DD15 engine was unveiled Oct. 19 at the company’s Redford, Mich., plant.
The six-cylinder, in-line DD15 displaces 14.8 liters and uses a new Amplified Common Rail System, as well as innovative turbo compounding technology.
The engine is the first in a series of new heavy-duty engines from Detroit Diesel that eventually will cover three displacement categories: 12.8 liters, 14.8 liters and 15.6 liters.
The market launch of the DD15 in the Freightliner Cascadia will take place in the second quarter of 2008, followed by the Freightliner Century S/T and Columbia models and the Sterling Set-Back L-Line and A-Line.
The DD15 is part of the new heavy-duty engine platform that ultimately will be manufactured by Daimler Trucks in Germany, Japan and the United States. In time, engines sharing this design will be available in all Daimler Trucks heavy-duty models around the world, including Freightliner, Sterling and Western Star as well as Mercedes-Benz and Mitsubishi Fuso trucks. The new platform eventually will replace four distinct engine series used globally by Daimler Trucks.
The platform features 90 percent globally shared parts, and engine development and production are being managed internationally.
The DD15 will be available from 455 hp to 560 hp and 1,550 lb.-ft. to 1,850 lb.-ft. of torque, including dual torque ratings for special applications.
The DD15 will be produced at the Redford, Mich., plant, which has been completely refurbished and retooled at a cost of $275 million.
The DD15 uses exhaust gas recirculation and a diesel particulate filter to meet the 2007 U.S. Environmental Protection Agency emissions standard. It will meet the 2010 standard with the addition of a downstream selective catalytic reduction device.
– From Staff Reports
Arrow to Give Away Truck, Job to Needy Owner-Operator
Arrow Truck Sales is giving away a 2005 VNL 670 from Volvo Trucks North America and a one-year work agreement from Heartland Express to an owner-operator in need of a truck and a job.
Arrow will accept nominations for its Back on the Road competition between Nov. 5 and Jan. 15 at www.backontheroad2008.com. The winner will be announced in March 2008 and will receive the truck during the Mid-America Trucking Show in Louisville, Ky.
Arrow invites everyone to nominate friends, family members, co-workers. even themselves. Applications will include a 250-word story explaining this particular person’s circumstances – a natural disaster, an extended period of military service, a family crisis, any misfortune – and why he or she deserves to win.
“We are excited for the opportunity to help someone get their life back on track,” said Carl Heikel, president and CEO of Arrow. “Back On The Road is about more than simply giving a truck away. It is about giving someone back their livelihood.”
Volvo will outfit the winner’s truck with Volvo Link, which combines the technology of satellites and the Internet to locate trucks and provide reliable two-way communication between terminals and drivers anywhere, any time.
– From Staff Reports
Volvo Trucks North America Names New CEO
Per Carlsson will be the next president and CEO of Volvo Trucks North America, the company announced Oct. 23.
Currently in charge of Volvo Powertrain Sweden, Carlsson will assume his new duties Jan. 1.
Carlsson succeeds Peter Karlsten, who becomes president and CEO of Volvo Powertrain on Dec. 1.
Lars Thoren, chief financial officer, will be acting president of Volvo Trucks North America during the intervening month, the company said.
– From Staff Reports