ATA’s Graves encourages industry to weigh in on Phase Two changes that will involve trailers

 

THE next round of Environmental Protection Agency (EPA) fuel-efficiency standards will involve trailers and have implications for the industry, according to Bill Graves, president and CEO of the American Trucking Associations (ATA).

Bill Graves, American Trucking Association

He said President Obama’s June speech called on the EPA to move forward with future rulemaking so even greater greenhouse gas reductions could be achieved, so Phase Two is under way, and the EPA and the National Highway Traffic Safety Administration (NHTSA) have told Graves that trailers will be a part of the discussion.

The ATA already has formed a fuel-efficiency advisory committee composed of many of the nation’s largest fleets, including Swift, Conway, UPS, and FedEx.

“They’re trying to figure out how we’re going to respond as an industry to round two and the fact that we will have an entire unit that’s going to be measured in terms of fuel efficiency,” Graves said. “We think the proposed Phase Two rule will come out sometime in late 2014 or early 2015. The final rule will be in 2016. It’ll be a rulemaking with public hearings.

“If you guys are not all over this, I hope you’re positioning yourselves on how you want to weigh in on these public hearings with what trailer dealers think about the way the government is mandating fuel efficiency. On one hand, I don’t know whether some of you will say, ‘That’s good news. We’ll have to come up with fuel-efficient stuff, and people will have to buy them, and that means we’ll sell more trailers.’ Or whether that means people will say, ‘Hey, I’m not going to spend money on those more expensive trailers because I don’t like the ROI I’m seeing, so I’m going to spend a lot of time and energy retrofitting and running trailers longer and longer so I don’t have to buy into what the feds are now mandating for the industry.’

“It is an important issue for anybody who’s involved in building trucks and trailers and operating them on the nation’s highways.”

Regardless of how fleets decide, expect trucks and trailers to remain the dominant method for getting freight from Point A to Point B. According to Graves, trucks will become even more important. In 2012, trucks moved 68.5% of freight. In 2024, it is projected to be 70.8%.

Trucks received 80.7% of total freight revenue in 2012, and they’re projected to receive 81% in 2024.

Graves said there’s potential for change in truck productivity.

In 1982, the weight was increased from 73,280 to 80,000 pounds. 1991, there was a federal freeze on longer combination vehicles.

He said there was a House Committee on Transportation and Infrastructure debate prior to MAP 21 that recommended a size and weight study.

The industry proposals:

• 97,000 lbs on six axles (state option).

• 88,000 lbs on five axles (state option).

• Expansion of longer combination vehicles (state option).

• Twin 33-foot trailers (federal mandate).

“Chairman Bud Shuster would prefer to avoid a fight,” Graves said. “There are the fewest objections to twin 33’s.”

Graves said the high cost of diesel fuel has created an “opening” for CNG and LNG.

“Deployment in bus, trash, and limited freight applications demonstrates the potential,” he said. “Major truck stops building out fueling infrastructure continues the momentum. Shippers and the environmental community are encouraging ‘green’ initiatives. The cost of equipment is still the biggest obstacle.”

Graves said on-highway diesel fuel prices are projected to drop from an average of $3.92 in 2013 to $3.76 in 2014 after reaching the all-time high of $3.97 in 2012.

He said there are a number of factors contributing to the pervasive driver shortage:

• A slow recovery, but an expanding economy nonetheless.

• An aging population of existing drivers.

• Hard work and long hours, which are not attractive to many young Americans.

• Stagnant wages for many drivers.

• A reduction in driver productivity due to electronic logging and Hours Of Service changes.

• It’s more difficult to find qualified drivers because of CSA.

He there is a potential shortfall of 239,000 drivers by 2020. The average number of new drivers needed per year over the next 10 years is 96,178. ♦

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