No one likes buying insurance, but it’s a necessary evil for every owner-operator. Read the April Monthly Focus on eTrucker.com to learn more about it.
TRUCK SALES, PRODUCTION RISING
Truck production and sales are off to a strong start in 2004, based on manufacturers’ reports, and it appears more growth is in store. U.S. sales were up for all truck classes, and Class 8 sales have risen 33 percent this year from last, according to the National Truck Equipment Association. Heavy-duty truck production jumped 51 percent in December and nearly 30 percent in January.
“A rebound in the heavy truck market is just around the corner,” forecasts Ken Kramer, a trucking analyst with Global Insight. Sales and orders have improved, motor carrier business is expanding, and 2004-2005 is expected to be a good period for the North American economy. Carriers will need to replace older trucks and some will expand fleets, Kramer wrote in a report.
U.S. heavy-truck sales will increase to 180,000 to 190,000 units this year and 240,000 to 250,000 units in 2005, Kramer predicted. That’s a lot of truck sales in comparison to the past three years, which saw sales averages at about 142,000 trucks. 2000 was the last year when Class 8 sales exceeded 200,000.
In its first-quarter report this year, Navistar International Corp. increased its forecast for 2004 total industry sales in the United States and Canada. Navistar expects heavy-truck sales to increase to 208,000 units this year. In December, it had estimated sales of 191,000.
The company recently announced plans to double in size, which includes a $150 million capital investment to introduce a new Class 8 truck in 2007.
Volvo Trucks says deliveries this year have increased 5 percent for Mack Trucks and 19 percent for Volvo Trucks compared to the same year-ago period. In May, Volvo will add a second shift to its Dublin, Va. plant.
Mark Pigott, chairman and chief executive officer of Paccar, which produces Peterbilt and Kenworth trucks, estimates “that the North American Class 8 truck market will improve 10 percent to 15 percent in 2004 as customers replace aging trucks and benefit from a gradual economic recovery.”
DaimlerChrysler expects sales to be up globally for its commercial truck division, which includes Freightliner, Sterling and Western Star Class 8 brands.
Also, the Truck Renting and Leasing Association report commercial trucks sales increased in late 2003. The group expects that trend to continue this year.
– JILL DUNN
FUEL PRICES ARE SOARING
Truck drivers are being hit with high fuel prices on the road and at home. Diesel prices have risen 12.5 cents nationally since the beginning of the year, and the average retail cost of a gallon of regular gasoline has jumped more than 24 cents.
The national average retail price for a gallon of diesel climbed to more than $1.60 for the first time in a year during March.
The normally conservative Energy Information Administration, which track fuel prices for the U.S. Department of Energy, says prices will probably be up for the foreseeable future. In fact, in testimony to Congress in March, Guy Caruso, EIA’s administrator, said the national gasoline average might reach $2 a gallon this year.
“The Organization of Petroleum Exporting Countries has kept oil supplies tight and oil prices relatively high,” Caruso told U.S. senators. “Many signs are pointing to a tight [fuel] market this driving season.”
One indicator was that OPEC pledged to further cut oil production April 1, limiting an already tight crude oil market and pushing up prices of diesel and gasoline. However, some of those cuts are already being seen in the current price for fuel, energy analysts say.
In March, scheduled maintenance on several refineries sent prices of diesel skyrocketing on the West Coast. Truckers in California were paying more than $1.92 a gallon.
Finally, a percolating economy is increasing miles for truckers and motorists. That increase in demand, ahead of the country’s normal summer driving season, is having a big impact on the price as well, Caruso says.
– SEAN KELLEY
GREAT AMERICAN TRUCKING FAMILY NOMINEES SOUGHT
Truckers News is looking for the third annual Great American Trucking Family. The magazine is searching for related drivers who have deep roots in the industry. Third-, fourth- and fifth-generation truckers, along with other relatives with trucking ties, can enter for a chance to be named the Great American Trucking Family. Industry honors and general civic involvement are taken into consideration, too.
The winning family will be announced at the Great American Trucking Show in Dallas, Sept. 10-12. That family will also be featured in the September issue of Truckers News. Entries, which must be received by June 1, should include a detailed family history and should be mailed to:
GATF c/o Truckers News, 3200 Rice Mine Road NE, Tuscaloosa, AL 35406
DISPLACED WORKER AID COULD INCLUDE TRUCK DRIVERS
Congress introduced bills to extend federal Trade Adjustment Assistance to truckers and other displaced service workers.
On March 2, U.S. Sen. Max Baucus introduced the Trade Adjustment Assistance Equity for Service Workers Act of 2004. Since 1962, the Trade Adjustment Assistance has provided retraining, income support, and other benefits to restart careers of displaced manufacturing and agricultural workers.
TAA was aimed at helping employees who lose jobs when trade policy is liberalized. But the U.S. economy has shifted its focus from manufacturing, Baucus said.
“In 2001, the service sector accounted for 81 percent of U.S. private sector gross domestic product and a similar percentage of total U.S. employment,” Baucus said during the bill’s introduction. Also in 2001, cross-border services trade increased to 21 percent of the total value of U.S. trade, he said.
In 1993, Congress instituted a new TAA program for workers dislocated as a result of the North American Free Trade Agreement, and later overhauled the TAA program in the Trade Act of 2002.
Currently, if a factory relocates overseas, its workers can receive TAA assistance. But if a company that provides a service, such as a call center, moves overseas, its employees are ineligible for the assistance.
The new legislation would target American service workers who lose their jobs to competition from foreign services. “For example, if a U.S. truck driver loses his job because his employer loses routes to a Mexican-domiciled trucking company, the U.S. driver would be eligible for TAA,” said Baucus, a Montana Democrat.
SB 2157 was immediately moved to the Senate Finance Committee.
U.S. Rep. Adam Smith introduced the House version of the bill March 3. It was referred to the House Committee on Ways and Means that day.
– JILL DUNN
GROUP PROPOSES TOLLED ROUTES FOR TRUCK-ONLY LANES
A Los Angeles-based think tank has identified the best Interstate corridors to test truck-only toll lanes.
Truckers’ tolls would pay for the building and operating costs of the lanes, which would be separated from other traffic by concrete jersey barriers, says a proposal by the Reason Foundation.
“But trucks using the toll lanes would be exempt from federal fuel taxes and other federal user charges for miles traveled on the truck-only toll lanes to avoid double taxation,” the report states.
Because the trucks would safely separate from other vehicles, longer combination vehicles would be permitted on truck-only toll lanes. When LCVs reached metro areas, the trucks would be broken down at staging areas and would not operate on urban freeways.
The American Trucking Associations, the American Road & Transportation Builders Association and the National Safety Council have supported the plan. U.S. Rep. Don Young, chairman of the U.S. House Transportation and Infrastructure Committee, is reviewing the report for a possible test program.
The report identifies some of the best candidates for the plan, based on revenue potential, construction costs and feedback from carriers. In most cases, the corridors would link existing LCV operations.
For example, the plan notes, “Interstate 75 from Toledo to Detroit is a spur off the nation’s largest existing LCV operation on the Indiana Toll Road and the Ohio Turnpike.” The major manufacturing areas of Detroit and Ontario, Canada, would be linked this way.
Researchers say other corridors that would work in the plan include: