Wednesday, October 19, 2011

House G.O.P. and Senator Kelly Ayotte (R-NH) Move to Stop HOS Regs

House Speaker Boehner of West Chester and Eric Cantor, Majority Leader from Virginia have asked President Obama to withdraw the administrations proposed changes to the hours-of-service rules for commercial drivers. Both said in a letter to Obama on Oct 5, that withdrawing the proposed changes is an "opportunity to avoid adding another $1billion in regulatory burden" to the economy and to small businesses. It is estimated 90% of all trucking companies can be classified as small businesses.

Senator Kelly Ayotte (R-NH) has filed an amendment (S.AMDT.754) to the "minibus" Appropriations Bill (H.R. 2122) which is made up of the Commerce, Justice and science; Agriculture, Rural Development, and Food and Drug Administration; and Transportation and Housing and Urban Development Appropriations Bills. The amendment would block implementing the pending hours of service rules for truck drivers. Ayotte’s amendment at this point has only been filed and may never be considered.

The Federal Motor Carrier Safety Administration rule, which is supposed to be made final on Oct. 28, but which seems likely to slip past that deadline, would reduce the daily driving limit for truck drivers from 11 to 10 and change drivers availability to restart their weekly work-cycle with a 34 hour rest period. The FMCSA has said they will not reduce driving time to 10 hours but it is clearly leaning in that direction.

Driven by the Teamsters, it appears that these proposed changes have other reasons behind them than just safety, and a further reduction in an already shrinking driver pool will only lead to upward pressure on transportation costs. These costs are almost always passed onto the consuming and buying public. Just to serve the current volume (which is low) more trucks will need to be added to our over-crowded highway system putting more stress on our infrastructure. This ill-conceived change will only further harm a struggling industry and add hundreds of millions of dollars in costs just through regulation. Whatever happened to an administration that was going to ease regulation on small businesses to foster job growth?

CSCMP - Firms See Capacity Curbed By Rising Costs, Regulation

By Daniel P. Bearth, Staff Writer Transport Topics

This story appears in the Oct. 10 print edition of Transport Topics.

PHILADELPHIA — The combination of rising truck equipment costs, the driver shortage and increased government regulation is forcing shippers to confront a new reality: Capacity is no longer “infinite,” and new ways to improve efficiency must be found, several industry experts said last week at the Council of Supply Chain Management Professionals annual conference.

“I don’t believe that historic levels of service are possible or sustainable,” said Don Osterberg, senior vice president of safety and security for Schneider National Inc., Green Bay, Wis.

Click here to read article

Friday, March 11, 2011

FMCSA Reaches Settlement With Three Trucking Associations

"CSA is a safety-critical program that helps to reduce commercial motor vehicle-related crashes and save lives,” said FMCSA Administrator Anne S. Ferro. “Through this settlement agreement, we addressed the concerns raised by petitioners without compromising the CSA program and its safety benefits.” http://csa.fmcsa.dot.gov/whats_New.aspx#30184

SPECIAL TRUCKLOAD RATE REPORT

Brokers Pay More Than Shippers in 20% of Key Lanes
By Mark Montague, Industry Pricing Analyst, Courtesy TransCore Trendlines

Although February is typically a slow month for spot market freight, a surge in demand drove broker "buy" rates above the shipper's direct contract rate for dry vans in almost 20% of major lanes with a length of haul above 250 miles. The pricing bump included a 2.5% increase in the national average line haul rate for vans, month over month.

Price increases may have been driven by pent-up demand following January's severe weather, combined with growing truckload capacity constraints. Market conditions in February even began to look surprisingly similar to June, when brokered truckload freight movements in about a third of the major U.S. lanes commanded a premium compared to shippers' contract rates with carriers.

As a national average, contract rates exceeded spot market rates by 14% for the month of February, a gap that typically covers broker commissions and fees. These comparisons are based on line haul rates, not including fuel surcharges. [Note: Comparisons are based on average spot market rates from February but contract rates are from January. February contract rates, due for release on March 23rd, are not expected to change significantly.]

Tuesday, February 22, 2011

Tuesday, February 8, 2011

Diesel Continues to Rise

Diesel continued to rise this week with the EIA reported on-highway cost for diesel of $3.513 per gallon and more than $3.60 per gallon on the west coast. Industry experts are now calling for diesel to rise above $4.00 per gallon by Memorial Day weekend and staying north of $4.00 throughout the summer.

Just today in a radio interview, House Speaker, John Boehner (R-West Chester, OH) predicted fuel will be $5.00 per gallon by the summer of 2012 unless serious efforts were made to lessen our dependence on foreign oil. With the unrest in countries like Egypt, Tunisia, Jordan and more market volatility remains highly unpredictable and the market threatened by these rising costs.

Fuel surcharges aside, the concern for carriers isn't just the cost, but also the initial outlay of cash or credit to purchase fuel (cash buyers are discounted) before they are able to collect from their brokers or shippers. Carriers are now looking to calculate the "cost of money" into their pricing strategies. Consider that a long-haul run of over 2000 miles will require a cash outlay of $1400 or more. We will continue to work with our customers and our carriers to manage these costs that protect the profitability of all three parties while continuing to provide the best transport services possible.