Government to Propose Truck Fuel Efficiency Rules

(Ken Thomas — Associated Press via MSNBC)

Plan is expected to seek about a 20 percent reduction in greenhouse gas emissions and fuel consumption
Future tractor-trailers, school buses, delivery vans, garbage trucks and heavy-duty pickup trucks must do better at the pump under first-ever fuel efficiency rules coming from the Obama administration.

The Environmental Protection Agency and the Transportation Department are moving ahead with a proposal for medium- and heavy-duty trucks, beginning with those sold in the 2014 model year and into the 2018 model year. Read more here.

Storm Breaks Over Plan to Raise Taxes on Diesel for US Truckers

(International Freighting Weekly – Katerina Kerrr)

Some hauliers claim fuel hike singles them out over other modes, but others claim extra revenue will ease traffic bottlenecks

Truckers in the US are facing higher diesel taxes. A Bill that would increase the tax on diesel used by hauliers by 12 cents to 36.4 cents per gallon has been criticised by the Owner Operator Independent Drivers Association (OOIDA), which claims saying it penalises truckers and fails to look at other modes such as rail.

However, the American Trucking Association (ATA) has pledged its support for the Bill, which it said would “address critical freight transportation needs, focusing resources on the nation’s most important goods movement corridors”. Read more here.

Truckload Demand, Pricing Seen Still Rising

(Journal of Commerce Online – William B. Cassidy)

Surveys show tight truckload capacity boosting rates 5% or more

Truckload carriers are reporting increasing demand for freight services and higher rates this month, a sign there may still be life in trucking’s fall peak season. Surveys by investment firm Longbow Research and Transport Capital Partners show truckload rates rising and capacity tightening since mid-August.

Longbow’s weekly Truckload Barometer, which measures demand and capacity, rose 10.5% from the previous week Sept. 14, its fourth consecutive increase. The index is up 40% since mid-August, Longbow said, despite other indications that the economy and international shipping and imports are slowing. Read more here.

U.S. Fleets Fear HoS Reduction, Driver Shortage

(Canadian Transportation & Logistics – James Menzies)

There are several issues weighing heavily on the minds of U.S. fleet executives who were speaking at the Commercial Vehicle Outlook Conference this week in Dallas, and they may not be what you'd expect.

Trucking industry leaders at the event seemed satisfied that freight volumes, and even trucking rates, were rebounding. What really concerned them was a growing sense that U.S. hours-of-service will soon be reduced and that a driver shortage of unprecedented proportions will soon arrive.

U.S. hours-of-service rules have been under review since late last year, when a coalition of special interest groups convinced the Federal Motor Carrier Safety Administration they were unsafe, even though highway safety has improved under the existing rules.

Fleet managers in attendance seemed resigned to the fact that allowable daily driving hours will be reduced by one or two hours as early as this fall and the 34-hour restart provision could even be stretched to 48 hours if lobbyists have their way.

"The hours-of-service rewrite is a political football and it will have nothing to do with good science," said ATA chairman Tommy Hodges. "It's a political football that is going to get passed over our heads. There's a good possibility we will lose one to two hours of driving time and there's a strong possibility we'll lose the 34-hour restart." Read more here.

New Canadian Transport Minister Appointed

(Today’s Trucking)

John Baird, who as Canadian transport minister was overseeing important initiatives like electronic on-board recorders and a new international bridge to the U.S., has been moved to the post of government House Leader in a cabinet shakeup.

Prime Minister Stephen Harper announced that Chuck Strahl, who was handling the Indian Affairs portfolio for the past three years, will take Baird's place at Transport Canada. [...]

It remains to be seen how the change affects trucking-related projects currently simmering on Transport Canada's stove, including plans to build a new bridge between Windsor, Ont. and Detroit. Read more here.

Canadian Truck Shipping Costs Rising

(Journal of Commerce Online – William B. Cassidy)

Index shows truckload rates, freight costs increased at slower rate in May
Canadian shippers paid more to move goods by truck in May, with overall freight costs rising 3% from April, the Canadian General Freight Index reports. Base truckload rates were up 2.7% from the previous month, the CGFI said.

The pace of rising costs had already started to slow in May, however. Overall freight costs and base rates rose 3.9% in April, the strongest increases this year.

“We are seeing increases in the truckload sector, which is likely more sensitive to changes in capacity demand,” said Alan Saipe, president of Supply Chain Surveys. “This could be an indication of what may come in the future for LTL rates.” Read more here.

FMCSA to Allow Canadian Domiciled Motor Carriers/Freight Forwarders to Obtain Required Insurance from Canadian Insurance Companies

(Logistics Blog – Kenneth E. Siegel, Strasburger & Price LLP)

In response to a petition filed by the Canadian government, the Federal Motor Carrier Safety Administration (“FMCSA”) has amended its liability insurance regulations for motor carriers. In another long-overdue step toward full reciprocity, it will now allow Canada-domiciled motor carriers and freight forwarders to maintain – as acceptable evidence of their required financial responsibility for accident liability – insurance policies issued by Canadian insurers legally authorized to issue such policies in the Canadian province or territory where the motor carrier or freight forwarder has its principal place of business.

The change to the regulations will eliminate the need for Canadian insurance companies to link with a “fronting” U.S. insurance company in order to legally insure Canada-domiciled motor carriers operating in the United States. Notice of the final rule was published by the FMCSA in the Federal Register on July 2, 2010 and becomes effective on August 2, 2010; 75 F.R. 38423. Read more here.

Transcore Freight Index Continues to Surge

(Canadian Transportation & Logistics)

TransCore's Canadian Freight Index continued to show improvement in June, posting its sixth consecutive month of double digit growth in spot market freight availability. The index indicates spot market freight availability was up 59% year-over-year in June.

The index was 11% higher than in May. June, notes TransCore, is generally a peak month for spot market freight. For the second quarter, spot market freight was up 39% over the first quarter and 70% better than Q2 2009. Cross-border load postings were up 68% year-over-year while equipment availability dropped 15% from June 2009, indicating a tightening of capacity.

TransCore's Canadian Freight Index is derived from its Loadlink freight-matching service, which features more than 12 million loads and trucks per year. Read more here.

May NAFTA Trade Posts Record Gain from Previous Year

(The Trucker – Kevin Jones)

Trade using surface transportation between the United States and its North American Free Trade Agreement (NAFTA) partners Canada and Mexico was 39.5% higher in May 2010 than in May 2009, reaching $66.8 billion, according to the Bureau of Transportation Statistics (BTS) of the U.S. Department of Transportation. The 39.5% increase was the largest percentage year-over-year increase in total U.S.-NAFTA surface trade on record, going back to April 1994. May was the third month in the last four with a record percentage year-over-year increase.

However, the value of U.S. surface transportation trade with Canada and Mexico in May 2010 remained 9.9% below the May 2008 level despite the 2009-2010 increase, BTS, a part of the Research and Innovative Technology Administration, reported.

North American surface freight value rose 1.5% in May 2010 from April 2010. Month-to-month changes can be affected by seasonal variations and other factors, BTS noted. Read more here.

Mexico Looks for Proposal to End Trucking Dispute

(Journal of Commerce Online – William B. Cassidy)

Without progress on cross-border trucking, punitive tariffs could be expanded

Mexico may expand the list of U.S. products facing billions of dollars in punitive tariffs unless the Obama administration proposes a cross-border trucking program. A Mexican government official told The Wall Street Journal Thursday that Mexico wants more than the revival of the pilot project killed by Congress last year. “If we don’t see a concrete proposal from the U.S. in the next few weeks, Mexico will exercise its legal rights,” the unnamed official told the financial newspaper.

Those rights, the official said, include expanding the retaliatory tariffs. Mexico imposed punitive tariffs on $2.4 billion worth of U.S. goods when Congress and the White House shut down a Bush-era test of cross-border trucking. The tariffs ranged from 10% to 45% and affected 90 products. Mexico is the second-largest export market for the U.S., receiving 12% of U.S. exports in 2009. Almost half of Mexico’s imports are sourced from the U.S. An expansion of the retaliatory tariffs could hit agricultural exports such as corn, rice and beans, the Council on Hemispheric Affairs said in a recent report. Read more here.

TL Rates Up, LTL Flat: Canadian General Freight Index

(Truck News)

Truckload rates are on the rise while LTL rates remain flat, according to the latest edition of the Canadian General Freight Index. The index measures the cost of ground transportation rates for Canadian shippers. The latest edition, released yesterday, includes April.

“The results show a definite increase in truckload rates – which is consistent with what we are seeing in the industry,” says Dr. Alan Saipe, president of Supply Chain Surveys. “Less than truckload appears to be staying flat.”

Overall freight costs rose 3.9% in April compared to March. Base rates, excluding fuel surcharges, increased 3.9% with average fuel surcharges decreasing by 1.4%.

“While we are seeing a clear increase in demand for truckload capacity, it is still too early to know for sure if the price increases seen in April is the start of an upward trend,” says Doug Payne, president of Nulogx.

U.S. Supreme Court Rules on Liability for Inland Portion of Intermodal Shipments

The U.S. Supreme Court has issued a ruling June 21 that reverses two Ninth Circuit Court of Appeals decisions concerning through bills of lading, which allow cargo owners to contract for transportation across oceans and to inland destinations in a single transaction.

The Supreme Court ruled 6-3 that the Carmack Amendment to the Interstate Commerce Act of 1887, which governs the liability of domestic rail carriers, does not cover damages to cargo during the inland leg of an international intermodal shipment moving under a through bill of lading issued by an ocean carrier where no domestic bill of lading was issued and the ocean carrier subcontracted for rail transportation. Instead, such shipments are covered by the Carriage of Goods by Sea Act, which regulates bills of lading issued by ocean carriers engaged in foreign trade.

The complete SCOTUS decision can be downloaded from our website.

DOT Removes Cargo Insurance Requirement for Most Motor Carriers, Freight Forwarders

(World Trade Interactive)

The Department of Transportation’s Federal Motor Carrier Safety Administration has issued a final rule that, effective March 21, 2011, will eliminate the requirement for most for-hire motor common carriers of property and freight forwarders to maintain cargo insurance in prescribed minimum amounts and file evidence of this insurance with FMCSA. Household goods motor carriers and household goods freight forwarders will continue to be subject to the cargo insurance requirement.

FMCSA states that all BMC-32 endorsements and BMC-34 certificates of insurance that insurers have issued to motor carriers and freight forwarders, except household goods motor carriers and household goods freight forwarders, will expire March 21, 2011. However, insurance companies will not need to cancel any previous FMCSA filings. In addition, FMCSA will not remove the names of insurance companies and the appropriate policy numbers from its Web sites and any other FMCSA distribution methods until March 18, 2013, to facilitate the identification of insurance coverage for claims arising from transportation occurring while the policies were in effect.

Trucking’s Carbon Footprint Goes Beyond On-Road Vehicles

(Trucking Info)

A trucking company’s carbon footprint goes beyond its on-road vehicle fleet to include other direct emissions, indirect emissions and the optional “life-cycle” emissions, according to the American Transportation Research Institute.

ATRI released the findings of its analysis of greenhouse gas reporting tools and emissions models, with the goal of helping carriers quantify potential sources of greenhouse gases within their operations.

“ATRI’s study also highlights the need for industry involvement in standardizing approaches for carbon accounting,” said Mike Naatz, president of the customer care division and chief customer officer for YRC Worldwide. Naatz is a member of the ATRI Research Advisory Committee, which identified this research priority.

ATRI’s research identified both U.S. and international reporting tools and methodologies. Among the key findings were differences in the weighting of model inputs, which in turn impact the reported level of emissions. Read more here.

Truckers Say Market’s Wrong, Economy Grows

(Forbes.com – Daniel Fisher)

A little-noticed indicator that taps directly into the movement of freight offers a hopeful contrast to the dismal performance of the stock market lately. The Ceridian-UCLA Pulse of Commerce Index jumped 3.1% in May, the largest monthly increase since February 1999. The index tracks credit-card purchases of diesel fuel at truckstops across the country and provides a real-time indication of how much freight is moving from ports and factories to consumers.

The jump in the PCI index joins positive signals from other indexes including manufacturing, manufacturing shipments and retail sales, all of which have been rising steadily from mid-2009 lows.

The only indices that remain stubbornly low are employment and retail inventories. Even those are arguably good signs for future profits, as manufacturers and retailers tuck in extra earnings for at least a while before adding employees and inventory to their overhead.

Stock markets have been forecasting an entirely different scenario lately, with the Standard & Poor’s 500 Index falling 16% since April. Economist Edward Leamer of UCLA says the stock market’s got it wrong. “The market is still dealing with the fear effects of 2008 – investors are worried it will happen again,” says Leamer. “This is actual transactions. This is truckers buying fuel.” Read more here.

Related: More Evidence of Booming U.S. Demand: Traffic at LA Ports Surged in May (Business Insider)

U.S. Trucking Concerned by Wal-Mart Shipping Policy

(Handy Shipping Guide)

Reports in the press this week indicate that the giant Wal-mart chain may be changing its policy with regard to deliveries from its hundreds of suppliers. It is quite common for large corporations to switch transport and warehousing strategies every few years, often following management changes. After a review companies which handle their own logistics often conclude that a specialist supply chain company would be more cost effective and palm off property and staff in an effort to reduce costs. A few years later someone concludes that the subcontractor is growing fat on the proceeds and an ‘in house’ operation would raise extra revenue, and so the cycle continues.

The Wal-mart scenario, whilst not precisely like this, bears the same hallmarks in that with almost 7,000 trucks the marketing giant has doubtless found itself with spare transport capacity during the downturn and has taken the view that by utilising their own vehicles for collections from suppliers they will get a free ride. This effectively means goods purchased by Wal-mart will switch from a free delivered basis to ex works or subcontractors will simply get less business from the company. Read more here.

Proposed Truck Regs Would Come at a Cost

(DC Velocity – Mitch MacDonald)

The recession may be receding into the rear view mirror, but that doesn’t mean the freight community’s worries are behind it. In fact, for at least one segment of the business, the worst may be yet to come. Just as the freight recovery gets under way, the nation’s truckers find themselves facing a host of new challenges that could put a serious crimp in their operations. And that’s a concern not just for the folks who run trucking companies, but for the folks who use their services as well.

The source of their worries? A legislative climate that carriers say is downright hostile to truckers. “There is a certain amount of anti-truck rhetoric in Washington today,” YRC Worldwide COO Michael Smid said at the NASSTRAC conference in April. The result has been a flurry of regulations and proposals aimed at making trucking operations safer, greener, and more labor friendly. Trouble is, the regulations would do more than just make truckers greener, safer, etc.; they would also drive up their costs – and by extension, the rates shippers pay. “There are at least five issues at play,” Mike Regan, president and CEO of the consultancy TranzAct Technologies, warned at the NASSTRAC conference. “If they swing the wrong way, your rates will go up.”

And these rate increases could be substantial. According to some of the conference speakers, any one of these initiatives alone could result in a rate hike of 2% to 4%. If they were all to hit at once in a so-called “perfect storm” scenario, freight rates could shoot up as much as 15 to 20%. Read more Read more here.

Transportation Rates Are On the Rise for All Modes

(Logistics Today – Dave Blanchard)

As the economy slowly inches its way back to something resembling a recovery, the logistics industry is seeing a recovery of its own, one that will see manufacturers take a modest hit to the wallets as rates for motor carriers, railroads and intermodal transportation increase over the next six months.

According to FreightPulse 18, a semi-annual survey of preferred transportation modes conducted by equity research firm Morgan Stanley with Logistics Today, it’s expected that those shippers using rail carriers to move their freight will see a 2.5% hike in their rates through the end of 2010. Even so, rail carriers will see a 2.6% increase in the amount of goods shipped this year. Rail is generally the least expensive mode of domestic transportation, and volume growth is expected to be comparable to the 2003/2004 rebound. […]

• Rail rate increase 2.5%, volume increase 2.6%
• Intermodal rate increase 0.9%, volume increase 2.1%
• Truckload rate increase 0.6%, volume increase 2.7%
• Regional LTL rate increase 0.7%, volume increase 2.1%
• National LTL rate increase 0.7%, volume increase 1.5%

Read more here.

Source: Freight Pulse 18, conducted by Morgan Stanley with Logistics Today. Forecasts reflect expectations for freight rate and volume increases in the second half of 2010.

Brokers Beware! Your Carriers Have No Duty to Count the Goods

(Lexology – Marnee L. Baker, Baker Donelson Bearman Caldwell & Berkowitz PC )

A Tennessee appellate court recently held that a carrier had no duty to count the goods delivered to it by a broker’s customer, even when the goods were delivered to the carrier unsealed. As a result of this ruling, brokers must take care to ensure that goods are properly counted, when loaded and unloaded, or risk liability exposure when disputes arise as to delivery quantities. […]

As always, but more so now after Mark VII, it is critical to have complete, accurate and legible bills of lading. To avoid the trap posed by Mark VII, brokers should consider implementing policies and using contracts that require more complete bills of lading consistent with those of the Federal Motor Carrier Safety Administration (FMCSA), coupled with provisions that shift legal responsibility to the extent bills of lading prove to be incomplete, inaccurate or illegible. Additionally, brokers should evaluate whether their contracts adequately address the duty on the part of carriers to ensure the actual quantity of a load matches the quantity set forth on a bill of lading. Read more here.

Businesses Seek Resolution to Mexican Trucking Dispute; DOT Promises Proposal Soon

(World Trade Interactive)

A coalition of more than 100 companies and business and trade groups sent a letter recently to President Obama asking him to help resolve a long-running dispute with Mexico over the cross-border trucking provisions of NAFTA. The letter claimed that the $2.4 billion worth of retaliatory sanctions Mexico imposed against U.S. exports in 2009 in response to Congress’ termination of a pilot trucking program have cost the U.S. about 25,000 jobs. In addition, the letter said, many affected companies will not be able to endure the tariffs much longer, meaning that “more jobs will soon be lost.”

The coalition noted that a May 19 visit to the White House by Mexican President Felipe Calderon “will be an opportune time to finalize a resolution” to the trucking dispute. Transportation Secretary Ray LaHood held out hope that progress could be made at that meeting when he told a Senate committee last week that the administration is “very close” to announcing a plan that will apparently include restarting the pilot program. LaHood made a similar claim earlier this year. Read more here.