Transportation: Truck Report

ATA’s ‘Weights and Lengths’ modifications could impact shippers as much as carriers. By Chris Ferrell

In July, 2008 the American Trucking Association (ATA) proposed seven modifications to existing weights and lengths laws that they would like to see included in the 2009 renewal of the National Highway Bill, the primary piece of legislation that determines where and how money collected from the federal fuel tax is spent.

Since then, there’s been an intense behind-the-scenes lobbying effort taking place in Washington. But the “ATA Weights and Lengths” modifications, as they are known in beltway short-hand, could have as much of an effect on shippers as they do on carriers, none more so than certain subsets of the food and beverage industry.

The seven proposals the ATA recommended in testimony before Congress in the summer of 2008 are:

  • Allow western states to harmonize longer combination vehicle (LCV) laws and regulations;
  • Allow states to authorize six-axle, 97,000-pound tractor semi-trailers;
  • Remove gross weight limit on five-axle combination vehicles;
  • Allow limited expansion of LCVs beyond western scenario states;
  • Standardize 53-foot trailer length;
  • Allow states to authorize double 33-foot trailers;
  • Allow a 10 percent axle and gross weight tolerance for auto transporters.

In March, the Supply Chain Consortium conducted a survey of retailers, manufacturers and distributors to gauge shippers’ awareness of, support for, and potential benefit from, the proposed changes. Here’s what preliminary survey results showed

1. Nine out of 10 survey respondents said the laws would reduce total transportation expense. More than 45 percent expect they would experience savings in excess of 10 percent, and literally no one saw the proposals as having a negative impact on their bottom line.

2. Participants ranked allowing states to authorize 6-axle, 97,000-pound vehicles as the most important. While all seven proposals are viewed as financially beneficial, 58.8 percent of respondents estimated that one component could reduce transportation expense by greater than 10 percent. Allowing states to authorize double 33-foot trailers was second.

One-third of respondents identified a savings opportunity of greater than 10 percent Not surprisingly, the least useful of the seven is the one generally considered a “throw-in” for auto transporters. Only 2.3 percent of respondents saw any potential benefit from that proposal.

3. For companies that measure environmental initiatives, the average anticipated improvement from the ATA proposals is 8.9 percent. Whether the company tracked CO2 emissions, carbon footprint, or greenhouse gas (GHG) discharge, the numbers were consistently in the six to 10 percent range.

So with all of these benefits, one might think that the inclusion of the ATA’s proposals are a given. But the survey results provided some other insight that cast serious doubt on the future of the proposal. Some other takeaways:

4. Companies aren’t tracking the environmental metrics well enough. Considering the growing consumer (or voter) awareness of the subject and the renewed interest President Obama is placing on it, the fact that less than one-fourth of all participating companies are in a position to track and publicize a potential success story that is likely to silence many potential critics is troublesome.

5. Safety is a concern. The Supply Chain Consortium’s survey was sent to director and vice-president level personnel in transportation, operations and logistics, all of whom identified the proposals as either beneficial or having no impact on his or her company. So the fact that almost seven percent of participants are against the proposal due to safety concerns is significant.

The safety issue is the single most contentious point of the whole proposal and beliefs tend to fall into two categories: a) longer, heavier vehicles are inherently more dangerous; b) accidents are a function of total miles driven and driver experience, so having fewer trucks—albeit longer, heavier ones—will reduce accidents.

6. Perception is a bigger issue. Regardless of how participants saw the safety issue, larger trucks seem to give them pause. Despite the cost savings and environmental benefits only 2.2 percent are prepared to publicly support the legislation and only 26.1 percent are even willing to lobby for the ATA proposals through trade associations. It seems companies cannot afford to boisterously support these initiatives, lest their name be associated with a particularly bad accident.

7. Participants did not seem willing to sufficiently share the benefits. The 2009 Federal Highway Bill is estimated to be approximately $500 billion; almost double the most recent bill from 2005. Considering the productivity these proposals have the potential to create, a proactive pledge to share additional burden is likely to be well-received in Washington.

But 37.8 percent of all respondents are looking to “have their cake and eat it too,” meaning they want the benefits of the bill but are not willing to contribute back financially.

On the other hand, 28.9 percent would be willing to part with one to five percent of their savings. Less than seven percent of respondents were prepared to give back more than 20 percent of their productivity savings to help fund the bill that would make the productivity possible.

Implementation of even a few of these proposals would represent a productivity boon for both the trucking industry and shippers alike, particularly those with heavier loads like canned goods or liquids. But it is unclear whether or not shippers are willing—or able —to pay the price necessary to reap the benefits. But these are only what the results of the survey show so far.

WHAT DO YOU THINK?

As an exclusive to Food Logistics readers, an anonymous version of the same survey has been provided. In order to participate, go to the link below. Participants will be eligible to receive a complimentary copy of the complete survey results. Go to:
http://research.zarca.com/k/SsUVVSsYUsPsPsP)

Ferrell is associate director at the Supply Chain Consortium, Raleigh, NC.

The Supply Chain Consortium is the premier source for supply chain benchmarking and best practices knowledge.

With 200 participating retail, manufacturing and wholesale/distribution companies, the Consortium sponsors a comprehensive repository of 17,000-plus benchmarks complemented by search capabilities, online analysis tools, topic forums and peer networking for supply chain executives and practitioners.

To learn more about how your company can become a member of the Supply Chain Consortium, contact John Foley, 919-855-5461.or visit www.supplychainconsortium.com.

Loading