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.
In the nation's capital, legislation is what lawmakers do. As one veteran and somewhat jaded Washington lobbyist once remarked, "To a politician, introducing legislation is like breathing."
If industry comments greeting the House Transportation and Infrastructure Committee's five-year, $260 billion bill to fund the federal highway, transit, and safety programs is any indication, someone on Capitol Hill has taken a very deep breath.
The legislation, unveiled late Tuesday, has been trumpeted by Rep. John L. Mica (R-Fla.), the committee chairman, as the largest transportation reform bill since Congress created the Interstate Highway System mid-way through the presidency of Dwight D. Eisenhower. For freight interests that have clamored for more congressional recognition of freight's role in driving the U.S. and global economies, the bill goes a long way toward meeting that objective.
The bill, the American Energy and Infrastructure Jobs Act, proposes the first major federal change to truck size and weight limits since the early 1980s. It also restores to the states the authority to regulate truck sizes and weights, which was stripped from them in 1991.
The bill gives states the power to allow single-trailer trucks with gross vehicle weights of up to 97,000 pounds to operate on their portion of the nation's interstate highway system. The current federal weight limit is set at 80,000 pounds, though six states—Maine, New Hampshire, New York, Vermont, Massachusetts, and Rhode Island—allow six-axle trucks weighing up to 97,000 pounds to travel on their interstate highways. About 40 states allow vehicles weighing more than 80,000 pounds to operate on state roads.
The legislation would require the heavier trucks to be equipped with a sixth axle to maintain braking and handling characteristics at the higher weights. In addition, participating states would have the authority to exclude heavier trucks from operating on any route or bridge.
The bill also permits 33-foot trailers to be operated in doubles formation, up from the current maximum of 28 feet per trailer operating as a tandem. In addition, it would allow truckers to operate nationwide with triple-trailers up to 120 feet long.
Hurdles ahead
There are potential roadblocks to moving the House bill forward. The bill will be debated on Thursday, with possible amendments to be introduced and addressed. It then must be reconciled with the version that emerges from the Senate, a process expected to be politically bruising. The traditional funding mechanism, the fuel tax on cars and trucks, will not be sufficient to pay for the entire program. What is expected to be a $50 billion shortfall will likely need to be made up from funds transferred from the general treasury.
Still, advocates say there is hope that after eight short-term extensions since the last transport law expired in September 2009, a multiyear reauthorization bill could go to President Obama's desk for signature during 2012. However, it is unlikely that the process could move swiftly enough to avoid a ninth extension after the current one expires on March 31.
A focus on freight
Many shipper and carrier interests have long believed the increased use of longer and heavier vehicles will be the primary, if not the only, solution to a looming capacity crunch, escalating fuel prices, and greenhouse gas emissions. For them, the bill was manna from heaven.
The Coalition for Transportation Productivity, a group of 200 shippers and associations, said the measure will help truckers meet the demands of the supply chain while reducing the number of truckloads, amount of diesel fuel, and number of vehicle miles necessary to do the job.
"Truck capacity has dropped by 16 percent since the recession started, and the 30-year-old federal vehicle weight limit compounds the problem by forcing many trucks to travel when they are only partially full," said John Runyan, CTP's executive director, in a statement.
CleanerSaferTrucking Inc., a coalition of truckers, shippers, and equipment manufacturers, said in a statement that the bill will increase truck productivity and lead to a "safer, more viable trucking industry, utilizing better equipment and providing better, more sustainable jobs, while reducing highway congestion."
The American Trucking Associations and the American Association of Port Authorities also endorsed the legislation.
The U.S. Chamber of Commerce, which, with 3 million members, is seen as an accurate barometer of multi-industry consensus, applauded the bill's introduction. "It reflects the recognition of the federal role in the transportation system," said Janet Kavinoky, who heads the chamber's transportation infrastructure practice.
Kavinoky added that the bill underscores the need to focus on freight and its importance in keeping the U.S. economy competitive.
Critics take aim
Not all of the reaction was positive. The Association of American Railroads (AAR), the Teamsters union, and the Owner-Operator Independent Drivers Association (OOIDA) attacked the bill, saying it will create undue safety risk, further damage the nation's deteriorating infrastructure, and put additional financial burdens on taxpayers, and will not create jobs as the bill's sponsors contend.
The AAR, which has for years fought federal efforts to raise truck size and weight limits, said the operator of a typical 97,000-pound, six-axle truck pays only half of the cost of repairing road damage caused by its use. Taxpayers pick up the rest of the tab, the AAR said.
"Americans don't want 97,000 pounds or huge multi-trailers up to 120 feet long on our nation's highways," said Edward R. Hamberger, AAR's president and CEO, in a statement.
OOIDA, which represent mostly fleets of one to five trucks, argued that longer and heavier vehicles are harder to maneuver and will put additional stress on roads and bridges that are designed to accommodate weights no greater than 80,000 pounds. OOIDA said an increase in size and weight limits has never resulted in a reduction in truck traffic.
OOIDA warned the legislation would lead to tax increases and new toll levies because the cost of potentially massive road and bridge damage would far exceed the inflow of user fees paid by the companies that would benefit from the proposed increase in size and weight limits.
Economic activity in the logistics industry continued its expansion streak in October, growing for the 11th straight month and reaching its highest level in two years, according to the most recent Logistics Managers’ Index report (LMI), released this week.
The LMI registered 58.9, up from 58.6 in September, and continued a run of moderate growth that began late in 2023. The LMI is a monthly measure of business activity across warehousing and transportation markets. A reading above 50 indicates expansion, and a reading below 50 indicates contraction.
October’s reading showed the fastest rate of expansion in the overall index since September of 2022, when the index hit 61.4. The results show that the industry is continuing its steady recovery from the volatility and sluggish freight market conditions that plagued the sector just after the Covid-19 pandemic, according to the LMI researchers.
“The big takeaway is that we’re continuing the slow, steady recovery,” said LMI researcher Zac Rogers, associate professor of supply chain management at Colorado State University. “I think, ultimately, it’s better to have the slow and steady recovery because it is more sustainable.”
All eight of the LMI’s indices grew during the month, with the Transportation Prices index showing the most growth, at nearly 6 points higher than September, reflecting increased activity across transportation markets. Transportation capacity expanded slightly during the month, remaining just above the 50-point threshold. Rogers said more capacity will enter the market if prices continue to rise, citing idle capacity across the market due to overbuilding during the pandemic years.
“Normally we don’t have this much slack in the market,” he said. “We overbuilt in 2021, so there’s more slack available to soak up this additional demand.”
The LMI is a monthly survey of logistics managers from across the country. It tracks industry growth overall and across eight areas: inventory levels and costs; warehousing capacity, utilization, and prices; and transportation capacity, utilization, and prices. The report is released monthly by researchers from Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, in conjunction with the Council of Supply Chain Management Professionals (CSCMP).
The port worker strike that began yesterday on Canada’s west coast could cost that country $765 million a day in lost trade, according to the ALPS Marine analysis by Russell Group, a British data and analytics company.
Specifically, the labor strike at the ports of Vancouver, Prince Rupert, and Fraser-Surrey will hurt the commodities of furniture, metal products, meat products, aluminum, and clothing. But since the strike action is focused on stopping containers and general cargo, it will not slow operations in grain vessels or cruise ships, the firm said.
“The Canadian port strike is a microcosm of many of the issues that are impacting Western economies today; protection against automation, better work-life balance, and a cost-of-living crisis,” Russell Group Managing Director Suki Basi said in a release. “Taken together, these pressures are creating a cocktail of connected risk for countries, business, individuals and entire sectors such as marine insurance, which help to mitigate cargo exposures.”
The strike is also sending ripples through neighboring U.S. ports, which are hustling to absorb the diverted cargo, according to David Kamran, assistant vice president for Moody’s Ratings.
“The recurrence of strikes at Canadian seaports is positive for U.S. ports that may gain cargo throughput, depending on the strike duration,” Kamran said in a statement. “The current dispute at Vancouver is another example of the resistance of port unions to automation and the social risk involved with implementing these technologies. Persistent disruption in Canadian port access would strengthen the competitive position of US West Coast ports over the medium-term, as shippers seek to diversify cargo away from unreliable gateways.”
The strike is also affected rail movements, according to ocean cargo carrier Maersk. CN has stopped all international intermodal shipments bound for the west coast ports of Prince Rupert, Robbank, Centerm, Vanterm, and Fraser Surrey Docks. And CPKC has stopped acceptance of all export loads and pre-billed empties destined for Vancouver ports.
Connected with the turmoil, Maersk has suspended its import and export carrier demurrage and detention clock for most affected operations. The ultimate duration of the strike is unknown, but the situation is “rapidly evolving” as talks continue between the Longshore Workers Union (ILWU 514) and the British Columbia Maritime Employers Association (BCMEA), Maersk said.
Terms of the acquisition were not disclosed, but Mode Global said it will now assume Jillamy's comprehensive logistics and freight management solutions, while Jillamy's warehousing, packaging and fulfillment services remain unchanged. Under the agreement, Mode Global will gain more than 200 employees and add facilities in Pennsylvania, Arizona, Florida, Texas, Illinois, South Carolina, Maryland, and Ontario to its existing national footprint.
Chalfont, Pennsylvania-based Jillamy calls itself a 3PL provider with expertise in international freight, intermodal, less than truckload (LTL), consolidation, over the road truckload, partials, expedited, and air freight.
"We are excited to welcome the Jillamy freight team into the Mode Global family," Lance Malesh, Mode’s president and CEO, said in a release. "This acquisition represents a significant step forward in our growth strategy and aligns perfectly with Mode's strategic vision to expand our footprint, ensuring we remain at the forefront of the logistics industry. Joining forces with Jillamy enhances our service portfolio and provides our clients with more comprehensive and efficient logistics solutions."
In addition to its flagship Clorox bleach product, Oakland, California-based Clorox manages a diverse catalog of brands including Hidden Valley Ranch, Glad, Pine-Sol, Burt’s Bees, Kingsford, Scoop Away, Fresh Step, 409, Brita, Liquid Plumr, and Tilex.
British carbon emissions reduction platform provider M2030 is designed to help suppliers measure, manage and reduce carbon emissions. The new partnership aims to advance decarbonization throughout Clorox's value chain through the collection of emissions data, jointly identified and defined actions for reduction and continuous upskilling.
The program, which will record key figures on energy, will be gradually rolled out to several suppliers of the company's strategic raw materials and packaging, which collectively represents more than half of Clorox's scope 3 emissions.
M2030 enables suppliers to regularly track and share their progress with other customers using the M2030 platform. Suppliers will also be able to export relevant compatible data for submission to the Carbon Disclosure Project (CDP), a global disclosure system to manage environmental data.
"As part of Clorox's efforts to foster a cleaner world, we have a responsibility to ensure our suppliers are equipped with the capabilities necessary for forging their own sustainability journeys," said Niki King, Chief Sustainability Officer at The Clorox Company. "Climate action is a complex endeavor that requires companies to engage all parts of their supply chain in order to meaningfully reduce their environmental impact."
Supply chain risk analytics company Everstream Analytics has launched a product that can quantify the impact of leading climate indicators and project how identified risk will impact customer supply chains.
Expanding upon the weather and climate intelligence Everstream already provides, the new “Climate Risk Scores” tool enables clients to apply eight climate indicator risk projection scores to their facilities and supplier locations to forecast future climate risk and support business continuity.
The tool leverages data from the United Nations’ Intergovernmental Panel on Climate Change (IPCC) to project scores to varying locations using those eight category indicators: tropical cyclone, river flood, sea level rise, heat, fire weather, cold, drought and precipitation.
The Climate Risk Scores capability provides indicator risk projections for key natural disaster and weather risks into 2040, 2050 and 2100, offering several forecast scenarios at each juncture. The proactive planning tool can apply these insights to an organization’s systems via APIs, to directly incorporate climate projections and risk severity levels into your action systems for smarter decisions. Climate Risk scores offer insights into how these new operations may be affected, allowing organizations to make informed decisions and mitigate risks proactively.
“As temperatures and extreme weather events around the world continue to rise, businesses can no longer ignore the impact of climate change on their operations and suppliers,” Jon Davis, Chief Meteorologist at Everstream Analytics, said in a release. “We’ve consulted with the world’s largest brands on the top risk indicators impacting their operations, and we’re thrilled to bring this industry-first capability into Explore to automate access for all our clients. With pathways ranging from low to high impact, this capability further enables organizations to grasp the full spectrum of potential outcomes in real-time, make informed decisions and proactively mitigate risks.”