source: outdoor.com

As concern about global climate change continues to rise, more and more people are talking about shifting freight from trucks to rail. Rail is more efficient, many believe, and it requires less fuel consumption.

“This would really benefit the environment,” they say.

We say, “Not so fast.”

A recent analysis published in Transportation Fundamentals examines the truck vs. rail question and finds some interesting answers. According to author Noël Perry, managing director and senior consultant at FTR Associates, most of the U.S. freight now traveling by truck would actually require more energy consumption if transported rail-only. While rail itself is more fuel efficient, it creates far more of certain emissions than trucks are allowed to under current standards. Clearly the addition of trucks, at least in some stages of the supply chain, allows for the most effective — and greenest — combination of resources.

As Perry writes, “Existing market forces have already done an excellent job of maximizing fuel efficiency by allowing rail and truck to do what they do best.”

What they do best, according to Perry, is intercity long-haul for rail and more local short-haul transportation for trucks. The biggest challenge to combining those strengths is accessibility to intermodal terminals to enable convenient truck-to-rail transloading. The government should, Perry argues, support increased accessibility to those terminals. He also favors modifying truck size and weight standards and lowering rail’s nitrogen oxide (NOx) emissions limits to current truck standards. These actions would represent significant steps toward a greener transportation system.

Valid points, all.

There’s also the question of congestion in the nation’s freight system, a problematic issue that could become very serious in the event of a major increase in rail freight. Industry analysts have predicted that adding even 25 percent more freight into the already overburdened rail system would create serious congestion, efficiency and productivity issues. What repercussions could we expect from adding even more freight than that?

When it comes to road congestion, the picture looks no rosier. While many rail proponents push for a modal shift that would remove 10 percent of freight traffic from America’s highways, that remains an unachievable goal. In fact, an American Trucking Associations (ATA) analysis found that doubling the freight tonnage traveling by rail would result in only a roughly 1 percent reduction in trucks on the road by 2018.  To multiply that figure by 10 would require tremendous rail infrastructure investments, which seems highly unlikely — especially given that the last major line-haul route built in the United States was constructed in 1909.

Clearly, there are no quick answers. But with freight tonnage projected to grow 28 percent by 2018 , it’s good that analysts like Noël Perry are asking — and finding answers — to the questions. Let’s keep that conversation going.

Source: US News

Last Wednesday, I spoke on behalf of American Trucking Associations (ATA) at a press conference sponsored by the Derivatives Reform Alliance. This organization is advocating for tougher regulation of commodity derivatives trading, which includes crude oil and refined products like diesel fuel.

If that sounds like some arcane financial manipulation practice, you’re right. But it affects anyone who uses diesel fuel, since the effect of this practice is to encourage excessive speculation in the trading and pricing of energy-based commodities.

Transportation companies already are under pressure from tight margins, excess supply and slack demand for services. Throw in volatile diesel fuel prices and it’s no wonder many companies are struggling to stay afloat. To deliver virtually all of the country’s consumer goods, the trucking industry consumes 34 billion gallons of diesel fuel annually. Fuel is generally considered the second highest expense incurred by trucking companies. Every one-cent increase in the price of diesel fuel costs the trucking industry an additional $340 million a year.

One year ago, the price of oil was $42 a barrel. Today that price is up over 70 percent, despite the fact that global demand is down, crude oil inventories are well above average, and the dollar has declined by only 8 percent relative to the Euro. What’s driving the higher prices? Excessive speculation is the only other variable left unaccounted for.

While there is no good metric that will quantify how much of the volatility and increased price of crude oil can be attributed to the influence of excessive speculation, it’s clear that this is part of the problem. To address this market disconnect, we believe that the federal government should take steps to increase the transparency of the derivatives markets. Reasonable aggregate position limits should be set. The Commodity Futures Trading Commission (CFTC) has proposed position limits for energy trades on certain commodities exchanges; however, this step by itself is insufficient to curb the problem of excessive speculation. There are still loopholes which allow destructive practices and leave the buyers of diesel fuel – and ultimately consumers – on the hook for the cost.

It is time for Congress to strengthen the Commission’s authority and eliminate trading loopholes. We encourage mandated transparency and stated aggregate position limits for all markets (including over-the-counter and foreign exchanges) that trade energy commodity derivatives. If we do not enforce position limits, the practice of excessive speculation will continue beyond the control of government regulators.

Importantly, the CFTC or Congress also must clarify and define the difference between a commercial participant and a legitimate hedger. A commercial participant — such as a trucking company — must take physical possession of a petroleum product. The trucking industry typically hedges diesel fuel by purchasing heating oil and crude oil derivatives. Recognizing these hedging surrogates is important in determining the status of various commercial participants. Those who purchase petroleum derivative contracts as a hedge against inflation — but who never take possession of the products — are more akin to pure speculators and should not be considered commercial participants. This destructive practice cries out for more legislative or regulatory oversight.

Transparency that distinguishes between commercial and non-commercial participants has no potential downside. Trading markets are improved and the price of oil remains unaffected. Tougher regulation would likely reduce speculative bubbles, restore investor confidence and strengthen the link between commodity prices and market fundamentals. We call on Congress to do the right thing and protect the commodities markets from destructive, excessive speculation through derivatives practices that add no value.

Source: fhwa.dot.gov

The message from BNSF Railway Group Vice President Stephen Branscum was strikingly positive. In a recent letter to Transport Topics magazine, he cited as accurate “BNSF’s willingness to work with shippers and American Trucking Associations to develop progressive changes to TS&W (truck size and weight) rules for the betterment of our nation’s transportation system . . .”

Could it be true?  Was the rail industry really ready to join up with us truckers and strike ahead as a united front to improve our nation’s critical transportation infrastructure?  I was giddy with anticipation!

Alas, while the sentiment was encouraging, sadly, it lasted about two seconds. In his letter, Mr. Branscum then quickly reverted to form, attacking the trucking industry, which, oddly enough, is one of the railroad’s largest customers. He criticized the industry and existing government policies, claiming: “The current system of taxation is subsidizing trucks . . . and provides a competitive advantage to the trucking industry, to the detriment of our nation’s roads and overall transportation system.” He also stated that trucking did not pay its fair share of infrastructure costs. These comments are all the more interesting, coming from an industry that is currently seeking a federal investment tax credit.

It’s disappointing to see the railroad industry unable to overcome old habits. Slamming the trucking industry with the same tired rhetoric does nothing to bring meaningful progress to the infrastructure problems we collectively face as a nation and an integrated transportation industry.

His comments, at best, are disingenuous. When you consider the billions of dollars trucking pays annually through registration fees, fuel, sales and excise taxes, tolls and other assessments — monies intended for bridge and road maintenance and capacity increases — Mr. Branscum’s argument doesn’t wash. The larger issue is how some of these funds are being co-opted for uses other than modernizing and repairing our highways. Today, about 25% of every gasoline or fuel tax dollar collected from highway users is diverted to non-highway use — projects such as heavy and light-rail mass transit, bridle paths, bicycle trails and Frisbee parks.

The economic success of the United States cannot be decoupled from our transportation systems. It takes all modes of transportation to move America, and it takes a vibrant, well-designed and well-maintained critical infrastructure to provide the foundation for our nation to compete in the global marketplace. Each mode of transportation plays a role. Shippers ultimately determine the mode that provides the best value proposition.

It should be incumbent upon transportation service providers to work together to improve our nation’s infrastructure. Trucking provides exclusive service to about 80% of our nation’s cities and towns. If the rail industry were to double its intermodal capacity overnight, it would remove only an additional 1.5% of trucks from our highways. Those are inconvenient truths for the rail industry.

The Highway Trust Fund and its funding mechanisms perform as designed and ensure that highway users pay their fair share toward the costs of maintaining and improving our infrastructure. What needs to be addressed are those policy decisions that prevent 100% of these funds from being applied to where they are most sorely needed — our highways.

A long-running battle over reducing diesel emissions from port drayage trucks has turned into a serious threat to nearly 30 years of trucking deregulation.

Several years ago an alliance of union and environmental groups threatened to make it politically impossible for the ports of Los Angeles and Long Beach to expand unless they cracked down hard on emissions from the thousands of trucks used in drayage of containers to and from rail yards and distribution centers in Southern California

Their package deal was that the ports would henceforth deal only with companies rather than thousands of individual owner-drivers, on the grounds that only large companies could afford to replace all those trucks with new trucks compliant with 2007 Federal diesel emission standards.

The not-so-hidden agenda was that drivers in truck fleets would be easy for the Teamsters to unionize, whereas they can’t do anything with owner-drivers.

The entire goods-movement industry, including the American Trucking Associations, objected to this plan as violating the Federal pre-emption of state or local economic regulation of trucking—and they prevailed last March in the 9th Circuit Court of Appeals. The Port of Long Beach dropped out and set up its own registration and certification program, pertaining solely to requiring clean-air compliance on a truck-by-truck basis. Both ports are offering subsidies to help truckers purchase compliant trucks, and as of a recent count, over 5,500 trucks have either been replaced or retrofitted in less than a year. An October headline in the Los Angeles Times said “Diesel Emissions Down Drastically at Ports of L.A., Long Beach.”

Having lost in court, the Coalition for Clean and Safe Ports, representing 80 environmental and labor groups, has mobilized to change federal law. Besides Los Angeles Mayor Antonio Villaraigosa, they have recruited the mayors of Oakland, Newark, and New York (and their ports) to urge Congress to amend the Federal Aviation Administration Authorization Act of 1994 (the most recent law dealing with federal pre-emption of transportation economic regulation) to permit ports to exclude owner-driver operators and deal only with fleets. Their aim is to get union-friendly legislators to slip such a provision into the surface transportation reauthorization bill.

Source: www.boston.com

That would be a huge mistake. As Journal of Commerce editor Paul Page wrote recently, “We’re talking about setting unprecedented limits on the pre-emption of federal regulatory authority over state laws that has been established and upheld in court rulings over many decades. We’re talking about the legal fabric of commerce in the United States.” Moreover, should individual ports be allowed to create this patchwork of policies, those that did so would put themselves at a competitive disadvantage. The ports of L.A. and Oakland compete with Canada’s Vancouver and Prince Rupert and Mexico’s Lazaro Cardenas, all well-served by long-distance rail. And the Port of New York and New Jersey competes with major ports in Virginia, Georgia, Houston and elsewhere.

Even partially rolling back trucking deregulation would set a terrible precedent, emboldening those who would like to undo railroad and airline deregulation as well. Let’s hope cooler heads prevail as Congress drafts and debates reauthorization.

A day does not go by in Washington without legislation intended to fix one problem ultimately affecting a host of other issues. It’s the principle of unintended consequences, and a fact of life in our complex world where everything has become so interconnected. Nowhere is this more evident than the transportation industry, which touches our economy, our environment and our infrastructure in virtually innumerable ways. It’s like the lyric from the popular children’s song that says “The knee bone’s connected to the thigh bone ...” Trucking, it seems, is connected to everything.

One example of how one issue can have a ripple effect on many others is truck productivity. The crux of the issue is truck size and weight, a debate that’s been raging for years in Washington and throughout the transportation sector. Recent forecasts estimate that freight volumes will increase nearly 28 percent by 2018, a growth curve that — absent any change in current size and weight restrictions — will require several million more trucks on America’s highways to meet demand. “More jobs, now that’s great!” you might think … until you consider the interconnected, unintended consequences: more traffic congestion and lost productivity. Increased fuel consumption and higher carbon emissions. The effect of more trucks putting more miles on a highway infrastructure already strained to the breaking point. The knee bone’s connected to the thigh bone ...

Many in the industry think the solution is clear: improve truck productivity. And there is a precedent — our counterparts in Europe, Canada and Australia have already done that and are reaping significant benefits. There’s plenty of research to support it. A 2008 American Transportation Research Institute study found that aligning our truck size and weight with the higher international standards would lead to great gains in productivity, as well as reductions in carbon emissions and a better shot at competing effectively in the global marketplace. The American Trucking Associations (ATA) has produced a list of recommendations — including raising the allowable weight of six-axle vehicles to 97,000 pounds and permitting 33-foot trailer combinations in certain states, and expanding the use of triple trailers where it is safe and practical to do so. We hope Congress will seriously consider them. With the projected rise in freight volumes, maximizing the efficiency of our transportation infrastructure has never been more important.

One state that may prove to be a good test bed is Maine. The Fiscal Year 2010 Transportation Appropriations bill recently signed into law by President Obama includes a provision to create a one-year pilot project to study the effects of eliminating the 80,000-pound vehicle weight limit on Maine’s federal highways. Allowing heavier trucks for a year will give researchers a chance to assess the impact on the much-debated areas of safety, commerce and road wear and tear.

It will be interesting to see how this experiment will educate the debate and, ultimately, the policy decisions which result. If the experience of our international colleagues is any guide, the consequences of more productive trucks will bring measurable benefits — for highway safety, the economy, our environment, congestion, business efficiency, energy policy and many other issues. The knee bone is connected to the thigh bone ...

I was talking to a Con-way Freight driver the other day and we got on the subject of distracted drivers. It really lit him up. “It’s getting worse,” he told me, shaking his head in despair. “If it’s not someone distracted on a cell phone, it’s somebody else trying to read or send a text message. They take their eyes off the road and the next thing you know, they’re drifting into me!

It’s time that we ratchet up the volume on this problem and get people to pay attention. Kudos to Transportation Secretary Ray LaHood, whose Welcome to the Fast Lane blog last week saluted organizations taking steps to combat distracted driving and the threat this presents to the safety of America’s highways.

Con-way has nearly 18,000 employees who are literally working on the road every day. It’s like their office. They treat driving with all the attention and professionalism you would expect of someone who pilots a large commercial truck for a living, and has dozens of businesses reliant on that driver for the safe delivery of their goods. We share Secretary LaHood’s concern over this issue. Congress has held hearings on it and I recently testified before a House committee on this very subject, on behalf of the American Trucking Associations (ATA).

Con-way and ATA believe that while driver distraction can take many forms, the most problematic is the use of hand-held electronic devices and the act of reading, writing or sending text messages while a vehicle is in motion. According to a Virginia Tech Transportation Institute study, text messaging makes the risk of a crash or near-crash 23 times higher (see www.vtti.vt.edu) than normal. That threat to safety is unacceptable. Both Con-way and ATA support the ALERT Drivers Act of 2009 (H.R. 3535), the proposed legislation that would ban texting while operating a vehicle. Con-way already prohibits its drivers from using any PDA device while operating company trucks.

With some other forms of in-cab technology, the issue of distraction becomes more complicated. In-cab communications and driver monitoring systems, used widely in particular by long-haul truckload carriers, are a prime example. While under some circumstances these devices could cause driver distraction — and many companies including Con-way Truckload have addressed this issue through specific policies and usage training — they also enhance drivers’ ability to do their jobs safely, effectively and efficiently. We join ATA in the belief that detailed analysis and public comment should take place if any restrictions on this type of technology are considered.

New policies and, as necessary, legislation, will help battle the problem of distracted driving with the motoring public. But it won’t make a difference or resolve the threat to highway safety unless the change in laws is matched by a shift in public perception, attitude and especially, behavior. If automobile drivers don’t see these distractions as a threat to safety, behaviors simply won’t change. And that’s unacceptable.

Come on, America. Put down your PDAs while driving. You will be safer, as will the hundreds of thousands of professional truck drivers who are sharing the road with you and providing the critical services that keep our supply chains and economy humming.

Here’s a great idea for a bumper sticker: Gotta text? Pull over!