They both represent the interests of truck owners and managers. But when it comes to policy issues, two prominent trucking groups find common ground elusive.
Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.
Just because two organizations work in the same field doesn't mean they have to get along. Few seem to embrace that concept with more gusto than the American Trucking Associations and the Owner-Operator Independent Drivers Association.
Both groups, better known by their respective acronyms of ATA and OOIDA, are in the trucking business. Both represent the interests of owners and managers, though ATA's membership rolls include the largest companies, while OOIDA's members tend to be one-man operators who predominantly work under contract for larger trucking companies. But the two have repeatedly clashed over key public policy issues, and their disdain for each other's positions is hardly a private matter.
The latest set-to occurred in late January after G. Tommy Hodges, ATA's first vice chairman, asked Congress to enact a national speed limit of 65 miles per hour and to require that truck limiters be set at that speed for vehicles manufactured after 1992—both elements of what he termed the trucking industry's "environmental initiative." Hodges also called on lawmakers to raise to 97,000 pounds from 80,000 pounds the maximum gross vehicle weight limit for single-trailer units, and to authorize states to permit the operation of 33-foot twin trailers, which today are only in limited use in the Upper Great Plains region. (Virtually every state caps the length of twin trailers at 28 feet per trailer, limits that have been in place since 1991.)
Hodges had barely finished his testimony when OOIDA issued a statement accusing the ATA of "greenwashing" by cloaking proposals that would increase costs, eliminate competition, jeopardize safety, and line the pockets of big corporations in the mantle of environmentalism.
"Upping truck weights and mandating speed limiters in the name of sustainability is irresponsible and ridiculous," said Todd Spencer, OOIDA's blunt-spoken executive vice president, in the statement. Spencer said the industry would be better served by reducing the number of empty miles truckers have to drive, as well as the time and fuel spent waiting to load and unload their cargo. Combined, both cost truckers and consumers about $5.7 billion a year, he said.
In an interview, Spencer called the federal experience with speed limiters "disastrous," and said states should be responsible for establishing speed limits that are uniform for all vehicles and based on factors like weather patterns, infrastructure conditions, and driver behavior. He warned that ATA's call for widespread use of longer, heavier equipment would result in higher taxes and insurance costs, inflict further damage on an already highway system, and create safety problems as drivers struggle with rigs and trailers that are more challenging to operate.
ATA spokesman Clayton Boyce reiterated the group's position that longer and heavier truck-trailer combinations would make trucking operations more efficient and productive, thus reducing fuel usage and benefiting the environment. By removing thousands of trucks from the road, the industry would save more than 20 billion gallons of diesel fuel over 10 years and cut carbon emissions by more than 227 million tons over that time, ATA says.
Boyce said the equipment's use would be consistent with accepted highway and bridge design and meet the most stringent safety standards. He rejected as "specious" OOIDA's opposition to a nationwide speed limit and speed limiter setting, saying "speed limiting saves fuel no matter who is driving. It doesn't matter who the company is or who is behind the wheel."
You say yes, I say no
The fight over speed limits and bigger equipment represents just one area of disagreement between the two groups. There are plenty of others as well. For example, ATA backs a DOT proposal that requires truckers to equip their vehicles with electronic recorders if they are found to have a 10 percent or higher violation rate of the hours-of-service rule during each of two government compliance reviews conducted over two years. By contrast, OOIDA opposes the use of electronic recorders of any type to replace paper logs. The National Transportation Safety Board, for its part, believes on-board recorders should be mandated for the entire industry. (The DOT is expected to publish a rule on the issue by mid-year.)
In California, the ATA is aggressively fighting a plan by the Port of Los Angeles to phase out, over the next five years, owner-operators who provide drayage service at the port's terminals, shuttling goods between ports, intermodal rail ramps, and shipping docks. The port's so-called Clean Truck program requires a phased-in implementation of new or retrofitted low-emission tractors by Jan. 1, 2012, and mandates that by that time, all drivers be employees of port-approved carriers that own the tractors. The plan's critics argue it will force owner-operators and smaller truckers away from the port and create an acute shortage of draymen because most can ill afford to buy new tractors or retrofit existing ones.
ATA won a major victory March 20 when the U.S. Court of Appeals for the Ninth Circuit struck down the port's requirement that harbor truckers replace by year's end 20 percent of their owner-operators with employee drivers. The appellate court ruled the port's policy represented state or local regulation of interstate trucking and violated federal law. It remanded the case to the U.S. District Court in Los Angeles "for an appropriate preliminary injunction." ATA said in a statement that it was "extremely pleased" with the ruling.
OOIDA, which has remained silent on the issue even though owner-operators would be most affected by the port policy, was unavailable for comment when DC VELOCITY went to press. But in comments made several weeks prior to the March 20 ruling, Spencer said the ATA's arguments were trumped by the imperative of having a workable drayage model that is in compliance with clean air laws. "What ATA is doing is seeking to maintain the status quo, and that dog don't hunt," he said. OOIDA does not represent truckers who perform drayage at the nation's ports, although its membership includes truckers who operate to and from ports throughout the country, including Los Angeles.
ATA and OOIDA have also been at odds over an initiative to allow Mexico-based truckers to operate in U.S. commerce beyond designated border commercial zones. OOIDA bitterly opposed the initiative, saying such a move would potentially allow thousands of unsafe vehicles and unqualified drivers on U.S. roads. ATA supported the plan, saying it would reduce the time and expense of multiple handoffs of trailers and containers and, in the process, cut carbon emissions. ATA also pointed to government studies showing that the program would have no negative impact on U.S. highway safety. (Debate over the issue was effectively mooted after President Barack Obama signed into law the $410 billion omnibus spending bill, which ended congressional funding of an 18-month pilot program designed to give Mexican truckers full access to U.S. commerce. The Obama administration has said it will explore alternative measures for establishing a new cross-border trucking program with Mexico.)
The two groups are not at loggerheads over everything. Both favor an increase in fuel taxes to pay for infrastructure improvements so long as there are guarantees that the funds will not be diverted for non-highway use. Neither strongly opposed the federal government's new driver hours-of-service regulations prohibiting drivers from spending more than 11 consecutive hours behind the wheel and requiring at least 10 hours' rest between shifts. However, OOIDA was uncomfortable with language mandating that drivers work no more than 14 hours in a day, saying that doesn't give drivers sufficient time to rest between operating their routes and loading and unloading their cargo. ATA did not oppose that measure.
Frequent clashes
The culture gap between the groups can be traced to their roots. ATA is deeply tied to the federal policy apparatus; it has called the Washington, D.C., area home since its founding in 1933 and today sits in new headquarters in Arlington, Va., a Washington suburb. Its president and CEO, Bill Graves, grew up in a trucking family but has spent more than two decades in highprofile public sector posts. Graves joined ATA in 2003 after serving as two-term governor of his home state of Kansas. ATA has 37,000 members, mostly mid-sized to large truckers as well as big shippers like Wal-Mart Stores that operate private fleets.
OOIDA's roots are more hardscrabble. Its president, Jim Johnston, was a driver and an owner-operator until he was named president of the fledgling group in 1973. He is the only person to ever hold the post. OOIDA started life in an office trailer chained to a light pole at a truck stop in Grain Valley, Mo., near Kansas City. Today, OOIDA has 160,000 members, and it still calls Grain Valley home.
The key difference between the groups, according to Boyce, is the makeup of their respective constituencies. "ATA represents trucking companies," he says. "OOIDA represents individual drivers, all of whom choose not to be trucking company employees."
Has the failure to present a united front undermined the two groups' lobbying efforts? Not in Boyce's opinion.He says the many opposing views have little if any bearing on the trucking industry's relationship with Congress. Jim Berard, director of communications for the House Transportation and Infrastructure Committee, agrees, saying the frequent clashes actually benefit the industry's relationship with Congress rather than cause friction. "We get depth and insight into industry positions when different viewpoints are brought to the table," Berard says.
Spencer of OOIDA says ATA reflects the positions of large trucking interests, while OOIDA's stances represent those of small mom-andpop concerns that can't move regulatory and political mountains yet, in aggregate, move a large proportion of the nation's freight. "There is something to be said for having a presence in Washington. We've had an office there for several years," says Spencer. "But I don't know of any trucking companies that are headquartered in Washington, D.C."
While many companies are launching artificial intelligence (AI) products for use as generic “co-pilots” or consumer-focused gadgets, the Swedish enterprise resource planning (ERP) software vendor IFS says its “Industrial AI” version supports industry-specific processes in “hardcore” sectors based on assets such as power grids, cell phone networks, aircraft maintenance, elevator operation, and construction management.
“Industrial AI is at the very core the solutions we are powering for customers. They are pushing us for ready-to-use AI that they can adopt quickly to solve real industrial challenges like labor shortages, supply chain disruption, [and] stagnated productivity," IFS's Chief Customer Officer, Cathie Hall, said in a release.
In presentations at its user conference in Orlando today, known as "IFS Unleashed," the company said that its latest IFS Cloud 24R2 release supports more than 60 in-depth Industrial AI scenarios. They span generative AI examples like: content generation for training and reports; recommendations for sourcing and suppliers; and contextual knowledge for assembly instruction. The tools also include predictive AI applications like event forecasting; optimization of resources and capacity; and anomaly detection for proactive quality control.
In remarks from the keynote stage, new IFS CEO Mark Moffat—who was appointed to the top office in January—said the company may be less well known than ERP vendors such as SAP, IBM, Oracle, and Infor, but it benefits from a tighter focus on its core users. Instead of selling software across dozens of industries, IFS serves just six industries: aerospace and defense, construction and engineering, energy and utilities, manufacturing, service, and telecommunications.
Thanks to that tight approach, he said the company has earned top Gartner rankings for its software products in field service management (FSM), enterprise asset management (EAM), enterprise resource planning (ERP), and enterprise service management (ESM). And to compound that advantage, Moffat said IFS continues to grow swiftly through acquisition, having bought up a handful of companies in recent months: Assyst, Ultimo, Boka, empowermx, Bolo, Tobin, Merrick, and Copperleaf.
“You need an AI business plan” Moffat told the room. “If you have an AI business plan, that’s terrific, but you can improve it. This area is just moving so fast.”
The top three corporate development priorities in consulting firm PwC’s current strategy are climate, artificial intelligence (AI), and business model reinvention (BMR), the company said in remarks today at an Orlando user conference for IFS software.
That approach meshes well with IFS, the Swedish firm which has added dozens of AI applications to its cloud-based enterprise resource planning (ERP) tools in recent months, that firm said at its "IFS Unleashed" event in Orlando. And underlying the industry’s rush to AI is the growing availability of massive amounts of data, PwC analyst Matthew Duffy said in a session at the show.
According to Duffy, data drives all the major technology changes that PwC advises businesses to examine: subscription or as-a-service models, connected devices and sensors, and conversions between business to business (B2B0 and business to consumer (B2C) approaches.
“Data availability now is greater than it’s ever been, and that’s where AI comes into play,” Duffy said. “It’s not just about driving cost efficiencies in an existing business model, but understanding your customer and your customer’s customer, so you can create a whole new value proposition.”
In fact, he said that PwC is not just giving that advice to its clients but applying it to the firm’s own strategy as well. That can be seen in the firm’s move in recent years to build its “Connected Solutions” business unit.
However, that trend is counterbalanced by economic uncertainty driven by geopolitics, which is prompting many companies to diversity their supply chains, Dun & Bradstreet said in its “Q4 2024 Global Business Optimism Insights” report, which was based on research conducted during the third quarter.
“While overall global business optimism has increased and inflation has abated, it’s important to recognize that geopolitics contribute to economic uncertainty,” Neeraj Sahai, president of Dun & Bradstreet International, said in a release. “Industry-specific regulatory risks and more stringent data requirements have emerged as the top concerns among a third of respondents. To mitigate these risks, businesses are considering diversifying their supply chains and markets to manage regulatory risk.”
According to the report, nearly four in five businesses are expressing increased optimism in domestic and export orders, capital expenditures, and financial risk due to a combination of easing financial pressures, shifts in monetary policies, robust regulatory frameworks, and higher participation in sustainability initiatives.
U.S. businesses recorded a nearly 9% rise in optimism, aided by falling inflation and expectations of further rate cuts. Similarly, business optimism in the U.K. and Spain showed notable recoveries as their respective central banks initiated monetary easing, rising by 13% and 9%, respectively. Emerging economies, such as Argentina and India, saw jumps in optimism levels due to declining inflation and increased domestic demand respectively.
"Businesses are increasingly confident as borrowing costs decline, boosting optimism for higher sales, stronger exports, and reduced financial risks," Arun Singh, Global Chief Economist at Dun & Bradstreet, said. "This confidence is driving capital investments, with easing supply chain pressures supporting growth in the year's final quarter."
The firms’ “GEP Global Supply Chain Volatility Index” tracks demand conditions, shortages, transportation costs, inventories, and backlogs based on a monthly survey of 27,000 businesses.
The rise in underutilized vendor capacity was driven by a deterioration in global demand. Factory purchasing activity was at its weakest in the year-to-date, with procurement trends in all major continents worsening in September and signaling gloomier prospects for economies heading into Q4, the report said.
According to the report, the slowing economy was seen across the major regions:
North America factory purchasing activity deteriorates more quickly in September, with demand at its weakest year-to-date, signaling a quickly slowing U.S. economy
Factory procurement activity in China fell for a third straight month, and devastation from Typhoon Yagi hit vendors feeding Southeast Asian markets like Vietnam
Europe's industrial recession deepens, leading to an even larger increase in supplier spare capacity
"September is the fourth straight month of declining demand and the third month running that the world's supply chains have spare capacity, as manufacturing becomes an increasing drag on the major economies," Jagadish Turimella, president of GEP, said in a release. "With the potential of a widening war in the Middle East impacting oil, and the possibility of more tariffs and trade barriers in the new year, manufacturers should prioritize agility and resilience in their procurement and supply chains."
The third-party logistics service provider (3PL) Total Distribution Inc. (TDI) is continuing to grow through acquisitions, announcing today that it has bought REO Processing & REO Logistics.
Terms of the deal were not disclosed, but REO Processing & REO Logistics is headquartered in West Virginia with 10 facilities across West Virginia in Parkersburg, Vienna, Huntington, Kenova, and Nitro as well as in Atlanta, GA.
Headquartered in Canton, Ohio, TDI is a wholly owned subsidiary of Peoples Services Inc. (PSI). The combined TDI and PSI businesses operate over 12 million square feet of contract and public warehouse space located in 65 facilities in eight states including Michigan, Ohio, West Virginia, New Jersey, Virginia, North Carolina, South Carolina, and Florida.
As an asset-based 3PL, the PSI network offers a range of specialized material handling and storage services including many value-added activities such as drumming, milling, tolling, packaging, kitting, inventory management, transloading, cross docking, transportation, and brokerage services.
This latest move follows a series of other acquisitions, as TDI bought D+S Distribution, Inc. and Integrated Logistics Services Inc. in May, and Swafford Trucking, Inc., Swafford Warehousing, Inc., and Swafford Transportation, Inc. in February. The company also bought Presidential Express Trucking, Inc. and Presidential Express Warehousing & Distribution, Inc. in 2023.