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Transportation News Bulletins - LTL and TL

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

House Votes to Replenish Highway Trust Fund
Thursday, 30 July 2009 00:00

The House of Representatives voted to transfer $7 billion into the ailing Highway Trust Fund, a move leaders said was necessary to keep the fund solvent through the upcoming congressional recess.

On Wednesday, the House of Representatives passed a resolution, 363 to 68, to transfer $7 billion dollars into the Highway Trust Fund with money from the Treasury.

“States are desperate for funding,” said Rep. Richard Neal (D-Mass.), chairman of the House Ways and Means Committee’s panel on select revenues. “We need to pay for these repairs. Kicking the can down the road will not work.”

The bill now leaves the Senate to address the trust fund issue. The two bodies have been at odds over how best to address the shortfall projected to impact the fund in August. The Senate has been working on a $27 billion infusion tied to an 18-month extension of the current surface transportation law.

“This is an infusion, not an extension. We are not standing for the whims of the other body or of the administration for an extension of time,” said Rep. James Oberstar (D-Minn.), chairman of the Committee on Transportation and Infrastructure, who added that the additional money “will carry the trust fund through the end of the fiscal year and into October.”

Rep. Jeff Flake (R-Ariz.) opposed the bill, saying that Congress should not bail out a fund that does not have enough revenue to support it.

“No new money is spent under this bill,” said Rep. John Lewis (D-Ga.), explaining the $7 billion comes from money that previously had been taken from the trust fund and placed in the general treasury.

Transport Topics, 7/30/2009

Record NAFTA drop in May
Thursday, 30 July 2009 00:00

Trade using surface transportation between the United States and its North American Free Trade Agreement partners Canada and Mexico was 35.4 percent lower in May 2009 than in May 2008, the biggest decline from the same month of the previous year on record, according to the Bureau of Transportation Statistics of the U.S. Department of Transportation.

BTS, a part of the Research and Innovative Technology Administration, reported that the value of North American surface trade dropped to $47.9 billion in the fifth consecutive month with a year-to-year decline of greater than 27 percent. Imports from Canada and Mexico to the United States in May were down 38.1 percent from May 2008, while exports from the United States declined 32.0 percent.

The value of U.S. surface transportation trade with Canada and Mexico fell 3.7 percent in May 2009 from April 2009; month-to-month changes can be affected by seasonal variations and other factors. The value of U.S. surface transportation trade with Canada and Mexico in May 2009 was down 9.9 percent compared to May 2004, and up 16.1 percent compared to May 1999. Imports in May were up 12.0 percent compared to May 1999, while exports were up 21.2 percent.

U.S.-Canada surface transportation trade totaled $29.2 billion in May 2009, down 40.3 percent compared to May 2008. The value of imports carried by truck was 35.7 percent lower in May 2009 than May 2008, while the value of exports carried by truck was 33.4 percent lower. Michigan led all states in surface trade with Canada in May 2009 with $2.8 billion.

U.S.-Mexico surface transportation trade totaled $18.6 billion in May 2009, down 26.0 percent compared to May 2008. The value of imports carried by truck was 23.4 percent lower in May 2009 than May 2008, while the value of exports carried by truck was 21.1 percent lower. Texas led all states in surface trade with Mexico in May 2009 with $6.2 billion.

The TransBorder Freight Data are a unique subset of official U.S. foreign trade statistics released by the U.S. Census Bureau; new data are tabulated monthly, and historical data are not adjusted for inflation. Surface transportation consists largely of freight movements by truck, rail and pipeline; about 88 percent of U.S. trade by value with Canada and Mexico moves on land., 7/30/2009

Fed ‘Beige Book’ Says Decline is Slowing, Transportation Still Weak
Wednesday, 29 July 2009 00:00

The Federal Reserve said Wednesday that almost all Federal Reserve districts are seeing the pace of economic recession slow down, but the transportation sector is still showing signs of weakness.

Freight transportation continues to remain below last year’s level in the Atlanta, Dallas and Cleveland districts, the Fed said in its latest beige book survey, which it issues eight times a year, surveying its 12 regional districts.

The Cleveland district reported that the transportation industry there is maintaining competitive shipping rates.

But in the Atlanta district, trucking companies said that an oversupply of trucks relative to low demand was pushing shipping rates down and making profit margins smaller.

In the Minneapolis district, a trucking company with 200 employees said it would close in August.

Suppliers also continue to suffer, with truck manufacturers in the Chicago district continuing to report weak activity. In the St. Louis district, small cars are selling relatively well, but the market for large trucks remains small.

The report, prepared by the Boston Fed, was based on information collected from June 2 through July 20.

Transport Topics, 7/29/2009

June Truck Tonnage Falls 13.6%
Tuesday, 28 July 2009 00:00

Truck tonnage decreased 13.6% in June compared with a year ago, American Trucking Associations said late Monday.

The decline in the for-hire seasonally adjusted truck tonnage index left tonnage at a reading of 99.8. The decrease surpassed May 11% year-over-year decline, ATA said.

June's drop was the largest year-over-year decline in the current cycle, ATA said.

The index fell 2.4% from May, but the decrease did not offset the 3.2% April to May gain.

Without accounting for seasonal adjustment, the index gained 5.2% from May, but the improvement was not enough to offset the 6.7% cumulative reduction from March and April.

ATA Chief Economist Bob Costello said that tonnage will likely be “hoppy” in the coming months.

“While I am hopeful that the worst is behind us, I just don’t see anything on the economic horizon that suggests freight tonnage is about to rise significantly or consistently,” Costello said in a statement.

“The consumer is still facing too many headwinds, including employment losses, tight credit, and falling home values, to name a few, that will make it very difficult for household spending to jump in the near term,” he added.

ATA calculates the tonnage each month based on reports by its member trucking companies.

Transport Topics, 7/28/2009

Investigative report criticizes ‘reincarnated’ motor carriers
Tuesday, 28 July 2009 00:00

One Texas motor carrier reregistered with the Federal Motor Carrier Safety Administration under the Spanish translation of its original name to avoid paying $143,000 in safety fines, though the company’s address, phone, fax and company officer name remained the same.

A bus company based out of a New York school was placed out-of-service and didn’t pay a fine. Instead, the carrier simply reregistered out of a church next door.

A report to Congress says that dozens of “reincarnated” motor carriers—both truck and bus companies— have gone out of business to avoid fixing safety problems or paying fines and instead are re-emerging under new identities, a practice long condemned by OOIDA.

The Government Accountability Office, Congress’ investigative arm, recently released a report mainly focused on bus companies that avoid safety issues and other payments by shutting down and restarting under a new name. Called “Motor Carrier Safety: Reincarnating Commercial Vehicle Companies Pose Safety Threat to the Motoring Public; Federal Safety Agency Has Initiated Efforts to Prevent Future Occurrences,” the report is available here.

Besides motor coaches, the report also showed how a lack of enforcement allows many questionable trucking companies to keep rolling.

The report showed 1,073 potentially reincarnated trucking companies during fiscal years 2007 and 2008, including at least 500 that were still active as of June.

“We referred the active carriers to FMCSA for further investigation,” the report stated.

The FMCSA and state law enforcement agencies conduct about 2.3 million vehicle inspections each year at weigh stations and other locations, though they’re only able to conduct compliance review on about 2 percent of motor carriers, the report states.

GAO identified 20 motor coach companies that reincarnated from out-of-service carriers, but the report says that number is likely understated.

“GAO analysis was based on exact matches and also could not identify owners who purposely provided FMCSA deceptive information on the application to hide the reincarnation from the agency,” the report states.

The investigation was launched after the U.S. House Committee on Transportation and Infrastructure asked the GAO to look into motor carriers after several recent major bus crashes tied to companies with questionable safety records.

For instance, on Aug. 8, 2008, a bus with Vietnamese pilgrims crashed in Sherman, TX, killing 17 people and injuring dozens more. The bus was owned by a company with a history of safety violations. At the time FMCSA briefly stopped issuing authority to new bus companies.

“According to FMCSA officials, registration and enforcement policies at the time of the Sherman, TX, crash, reincarnation was relatively simple to do and hard to detect,” the GAO report states.

The investigation sparked several statements from Washington, DC, lawmakers.

“It is obvious that these companies are intentionally trying to deceive FMCSA and the public by reinventing themselves as ‘new’ carriers,” said U.S. Rep. Jim Oberstar, D-MN, who chairs the House Transportation and Infrastructure Committee.

“In fact, these carriers are still operating the same unsafe vehicles, using the same unfit drivers, and engaging in the same unsafe operating practices. The carriers GAO identified were shut down because they were seriously jeopardizing public safety. FMCSA must protect public safety by making sure these unsafe carriers stay off the road.”

The Owner-Operator Independent Drivers Association has asked FMCSA to improve its ability to track these types of chameleon carriers for years.

OOIDA leadership was pleased to see the GAO investigate “reincarnated” motor carriers.

Rick Craig, OOIDA director of regulatory affairs, said the Association, however, hopes future investigations will look at more trucking operations.

“We know from experience and member complaints that there are a lot of trucking companies doing the same thing. The GAO needs to home in on them,” Craig said.

Trucking companies can avoid fines, court orders and other issues by shutting down and starting new companies, often from the same address.

“It allows all these scammers to keep screwing people and continue violating the law,” Craig said. “They steal money and operate unsafely and then disappear, just to open up under a new name and do the same things all over again.”

U.S. Rep. Peter DeFazio, D-OR, who also chairs the House Subcommittee on Highways and Transit, said the next highway bill will require DOT to do “a more thorough check” to keep rogue operators from rising from the dead.

The highway bill, called the Surface Transportation Authorization Act of 2009, was sent to the full House Transportation and Infrastructure Committee in late June. The bill includes provisions to address the problem of reincarnated carriers—both trucking and bus operations. The provisions include requiring FMCSA to check for past relationships among carriers seeking new registration and penalties against carriers who reincarnate.

“The findings of this GAO report are disturbing,” DeFazio said in a statement. “No motor coach company should ever be allowed to ‘reincarnate’ and continue to operate on our nation’s highways without making the necessary safety improvements.”

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