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Transportation News Bulletins - LTL and TL

Our current transportation LTL and TL news bulletins are powered by SMC3

Highway funding restored
Wednesday, 03 March 2010 00:00

The Senate on March 2 voted 78-19 to pass a $10 billion measure to fund highway projects and extend unemployment benefits for 30 days after Republican Sen. Jim Bunning of Kentucky agreed to end his filibuster demanding a way to pay for it first.

The original short-term extension of unemployment benefits needed unanimous consent to pass because Democrats labeled it an emergency spending measure, but Bunning had rejected the motion for unanimous consent.

“The bill passed tonight by the Senate will extend access to health care benefits for workers who have lost their jobs, help small businesses get loans so they can grow and hire, and extend unemployment insurance benefits for millions of Americans who are looking for work,” President Obama said after signing H.R. 4691 late Tuesday.

The Senate’s failure last week to overcome Bunning’s objections meant funding for federal highway, transit and highway safety programs ran out at midnight Feb. 28. The current surface transportation authorization act—the Safe, Accountable, Flexible, Efficient, Transportation Equity Act: A Legacy for Users (SAFETEA-LU)—was due to expire Sept. 30, 2009, but has been kept alive by a series of extensions while Congress considers a replacement authorization bill. A different bill pending in the House would extend SAFETEA-LU through the end of 2010.

The expiration forced employee layoffs at the U.S. Department of Transportation, including the Federal Motor Carrier Safety Administration, Federal Highway Administration, National Highway Traffic Safety Administration and the Research and Innovative Technology Administration.

DOT furloughed nearly 2,000 employees without pay starting March 1, temporarily shutting down highway reimbursements to states worth hundreds of millions of dollars, national anti-drunk driving efforts and multimillion dollar construction projects across the country. NHTSA said the furloughs disrupted safety programs that operate in partnership with the states and advocacy groups, such as Mothers Against Drunk Driving (MADD) and the International Association of Chiefs of Police (IACP).

Assistance to consumers whose goods are held hostage by rogue moving companies has been unavailable during this period. And work addressing texting while driving for commercial truck and bus drivers, electronic onboard recorders and hours of service also had been suspended., 3/3/2010

Dec. NAFTA Trade up 10.5 Percent From Previous Year
Wednesday, 03 March 2010 00:00

WASHINGTON—Trade using surface transportation between the United States and its North American Free Trade Agreement partners Canada and Mexico was 10.5 percent higher in December 2009 than in December 2008, with a value of $58.5 billion, according to the Bureau of Transportation Statistics of the U.S. Department of Transportation.

The increase was the first over the same month of the previous year since September 2008, but the value of trade in December still remained 4 percent below the value in December 2007. For the full year, however, NAFTA trade in 2009 was down 23.3 percent compared to 2008.

BTS, a part of the Research and Innovative Technology Administration, reported that the value of U.S. surface transportation trade with Canada and Mexico fell 0.8 percent in December 2009 from November 2009. Month-to-month changes can be affected by seasonal variations and other factors, BTS noted.

Surface transportation consists largely of freight movements by truck, rail, and pipeline. About 85 percent of U.S. trade by value with Canada and Mexico moves by land modes.

The value of U.S. surface transportation trade with Canada and Mexico in December was up 12.3 percent compared to December 2004, and up 36.6 percent compared to November 1999, a period of 10 years. Imports in December were up 37 percent compared to December 1999, while exports were up 36.2 percent.

U.S.–Canada surface transportation trade totaled $35.4 billion in December, up 7.8 percent compared to December 2008. The value of imports carried by truck was 2.3 percent lower in December 2009 compared to December 2008, while the value of exports carried by truck increased 11.2 percent during this period.

Michigan led all states in surface trade with Canada in December with $4.7 billion.

U.S.–Mexico surface transportation trade totaled $23 billion in December, up 15.0 percent compared to December 2008. The value of imports carried by truck was 15.5 percent higher in December 2009 than December 2008 while the value of exports carried by truck was 10.4 percent higher.

Texas led all states in surface trade with Mexico in December with $7.9 billion.

The TransBorder Freight Data are a unique subset of official U.S. foreign trade statistics released by the U.S. Census Bureau. December TransBorder numbers include data received by BTS as of Feb. 16.

BTS will release a summary of annual TransBorder data on March 18 and January TransBorder numbers on March 30., 3/3/2010

U.S. diesel price climbs 2.9 cents, $2.861
Tuesday, 02 March 2010 00:00

The national average retail price of a gallon of diesel increased for the second consecutive week, this time climbing 2.9 cents to $2.861 for the week ending Monday, March 1. The price, which had fallen 12.2 cents in the five weeks prior to last week’s 7.6-cent climb, is 77.4 cents higher than the same week last year, according to the U.S. Department of Energy.

All regions tracked by DOE saw price increases. The biggest increase, 4.6 cents, was found in the Central Atlantic, where prices climbed to $3.013. The smallest increase, 0.7 cent, was found in New England, where prices climbed to $3.018, the nation’s most expensive diesel by region. The nation’s least expensive diesel by region, $2.819, was found on the Gulf Coast, where prices climbed 2.6 cents.

California, which DOE tracks separately for its weekly update, saw a price increase of 4.3 cents to $3.023; that price is 87.9 cents higher than the same week last year.

Commercial Carrier Journal, 3/2/2010

CSA 2010 to Launch in July Despite ‘Snafus,’ Ferro Says
Monday, 01 March 2010 00:00

WASHINGTON—Federal Motor Carrier Safety Administrator Anne Ferro said she is committed to launching the agency’s new truck safety rating system in July, although she expects there will be problems at the start.

The new program, Comprehensive Safety Analysis 2010, “is not going to be a program we get right from the get-go,” Ferro said Feb. 23 in remarks to American Trucking Associations’ board of directors. “It will certainly impact carriers, and it is causing certainly some frustration and confusion.”

CSA 2010, as it is widely known, is FMCSA’s new regime for rating carriers and drivers. Among its features is timelier updating of fleet performance than the current SafeStat system.

The program is designed to push all carriers to improve compliance with safety rules and to force unsafe carriers to improve or leave the industry, something “many of you have been asking for, and expecting from, the FMCSA for many years,” Ferro told ATA. She said FMCSA would work with industry and law enforcement agencies as it transitions to the new program “to get it right,” but she also said it was important to “recognize there are going to be some snafus along the way.”

Starting this spring, all carriers will be able to access their CSA safety scores, and later this summer, the agency is set to begin enforcement under the program, Ferro said.

“It’s a big shift from the compliance review, which I have described as a balance sheet. That compliance review is one snapshot, taken in some cases five or 10 years ago,” Ferro said, referring to SafeStat.

She said CSA 2010 would feature “a more dynamic monthly financial report where you have the opportunity to examine and identify high-risk [drivers and carriers] . . . in a real-time fashion.”

Some ATA officials expressed apprehension about the program, and Ferro met with federation members and staff before addressing the board to hear the industry’s concerns.

Dave Osiecki, ATA’s senior vice president for policy, told Transport Topics that ATA was concerned primarily about three issues related to CSA 2010:

  • The use of all crashes rather than only the crashes in which the driver or trucking company is accountable.
  • The agency’s use of the number of trucks a company operates, rather than the number of miles they travel, for determining the frequency of violations.
  • The issuance of warnings, rather than citations, in the new enforcement regime.

By issuing warnings, rather than citations, there is no “due process” for carriers, which leaves them no way to challenge violations they feel may have been assigned in error, he said. “There’s no adjudication process,” Osiecki said.

After the ATA meeting with Ferro, Osiecki said, the administrator “understands each one of our concerns, and we believe . . . [FMCSA officials] are having an internal dialogue on them.”

Despite the concerns, Ferro told ATA’s members that the agency is “absolutely wedded to doing it, and doing it well, and doing it thoroughly and moving ahead incrementally.”

That push had Osiecki concerned, however. “My level of angst is high and getting higher,” he said.

ATA Chairman Tommy Hodges said the industry was being cautious as FMCSA moved to the new system, but some glitches are to be expected.

“Any time you overhaul a major guiding set of rules for any industry segment, we always have a great deal of apprehension,” he said. “We always have bumps in the road.”

Hodges said his concerns center on the effect of the new program on industry capacity.

“Undoubtedly, there will be some carriers forced out of the business, and undoubtedly, there will be many drivers forced out of the business,” he said.

Hodges pointed out that when freight is plentiful, fleets’ driver turnover rates rise, and most of that churn involves the bottom 20% of their driver rosters.

“That 20% might be the very ones that get pushed out of the industry,” he said. “If that’s the case, then where are those replacements going to come from? Because without that [supply of new drivers], I only have the ability to handle 80% of the business.”

However, Hodges said, the program “is going to make us a better, safer industry that’s better able to manage our safety processes, and that makes it worth it.”

Ferro said that, despite some of the angst, CSA 2010 could be “a phenomenal opportunity” for trucking companies that follow the rules.

“CSA 2010 will give the carrier the opportunity to go to a shipper and say, ‘You really don’t want to pick a carrier that has . . . [problems], and if you . . . [do], your customers are going to know about it,’ ” she said.

Transport Topics, 3/1/2010

January Truck Tonnage Jumps 5.7%
Monday, 01 March 2010 00:00
ATA Freight Index Posts Largest Gain Since ’05

January truck tonnage rose 5.7%, the biggest year-over-year increase in five years and solid evidence of a recovery in the industry and the U.S. economy, American Trucking Associations reported last week.

The increase in ATA’s seasonally adjusted tonnage index was the biggest year-to-year gain since January 2005 and was the second increase in a row after 14 consecutive months of setbacks.

The seasonally adjusted index hit its highest point since September 2008, ATA said in a Feb. 24 report that also noted a month-to-month increase of 3.1% from December to January.

Comments by fleet executives in recent days reinforced the positive trend. Growth is starting to appear even in the recession-ravaged flatbed sector, whose freight volume fell 20% last year but rose in December for the first time since August 2007, according to ATA.

“We generally feel better about the business,” Steven Williams, CEO of flatbed carrier Maverick USA, Little Rock, Ark., told Transport Topics.

“There are certain segments of the industry, such as steel, that are fairly robust,” Williams said. “There is a shortage of equipment in steel country.”

The overall economy is improving at the same time that capacity is being taken out of the industry, he said, either by operating carriers’ cutbacks or through fleet failures.

John Smith, CEO of CRST International, Cedar Rapids, Iowa, told TT that business “continues to pick up on a year-over-year basis. We have seen double-digit improvements in productivity—miles per tractor per week over last year.”

“We are getting close to where we were in 2006,” Smith said, describing that as a normal year. “Things are really up in both our regular van operations and our flatbed operations.”

Other carriers speaking at investor meetings last month reported year-to-year growth during January, including a 17% increase at Landstar System Inc., Jacksonville, Fla.

ATA Chief Economist Bob Costello said the index and the fleet executives’ reports show a recovery, both in the industry and the economy.

“While I don’t expect tonnage to continue growing as robustly as it did in January, the industry is finally moving in the right direction,” Costello said. “Although there are still risks that could throw the rebound offtrack, the likelihood of that happening continues to diminish.”

The improvement in the supply-and-demand balance hasn’t yet helped all flatbed segments, Williams said, noting that building products remain “extremely slow” because of the stagnant housing market.

Further evidence of housing troubles popped up last week. The Commerce Department reported that new home sales fell to a record low and housing prices also declined.

Furthermore, the Conference Board said consumer confidence slumped to its lowest level in 10 years, and the Labor Department said both new and continuing unemployment claims rose.

Although overall orders for durable goods—products lasting more than three years—increased, with aircraft and other transport products excluded, durable goods orders declined 0.6%.

“Going forward, manufacturers will be challenged by weak demand for big-ticket items by businesses and consumers,” David Huether, chief economist for the National Association of Manufacturers, said in a statement. Still, inventory restocking should be a temporary support for manufacturing output in the near term.

Despite the latest batch of reports, the positive freight trend is expected to continue and even gain strength, several economic analysts said in their reports.

Analyst Christopher Ceraso of Credit Suisse First Boston Companies now projects freight will rise 2.1% this year, more than the previous 1% estimate. The year-over-year growth should peak at around 5% in June, he said in his report, fueled by exports, nonresidential investment, inventory restocking and the federal stimulus plan.

“Expect tonnage to gradually improve as the economy strengthens and inventories are built,” said Deutsche Bank analyst Justin Yagerman, who noted in a Feb. 25 report that ATA’s index now has risen 10% since hitting an eight-year low in April.

A truckload freight index published by Morgan Stanley & Co. rose in the first half of February to levels last reached in early 2006, analyst William Greene said in a Feb. 19 report. He said part of the reason for that change could have been weather-related as nationwide demand picked up, but the number of available trucks was trimmed by blizzards in the eastern United States.

ATA’s advance seasonally adjusted index rose to 110.4 in January, while the December 2009 index was adjusted to 107 from 108.4 in annual data, the federation said. Without seasonal adjustment, the index fell 3.3% in January to 99.5.

After its revision of the seasonally adjusted index for the past five years, ATA said actual tonnage volume declined 8.7% for 2009 rather than 8.3%. Both numbers were the worst performance for the index since 1982, another recession year.

Transport Topics, 3/1/2010

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