As I write this column, much of the industry is anxiously awaiting a congressional fix for the rapidly depleting Highway Trust Fund and the longer-term problem of funding critical infrastructure repairs. Rep. Paul Ryan (R-Wis.) has promised a short-term plan to keep programs funded until the end of 2015, but once again, there's virtually no chance that a long-term solution will be enacted by May 31, when the current extension to last year's extension expires. By the time June 1 rolls around, we no doubt will have in place another temporary patchwork solution to a serious problem.
During the past year, there have been a number of politically motivated but inadequate suggestions, including devolution, or simply shifting the entire funding mechanism to the states. Considering that several states have already increased their own fuel taxes and pushed ahead with infrastructure improvements, this idea is not so far-fetched. Sen. Bob Corker (R-Tenn.) has suggested that we simply raise the fuel tax, but that "hot potato" is not going to get much support, particularly this close to the election. We have seen legislation to "Move America," "Grow America," and "Build America," but on the infrastructure front, America is sitting still.
But that doesn't mean Congress is sitting still. On April 28, the House Appropriations Committee released the 2016 Transportation, Housing, and Urban Development funding bill. The committee's press release is fairly straightforward, and the recital of the bill's highlights doesn't raise any red flags. But dig a little deeper and you'll uncover provisions that would seem to have no place in an appropriations bill, unless someone wanted to slip them into law with a minimum of attention. It has been suggested that these provisions were an early Christmas present for the trucking industry, which spent $9.85 million for lobbying and $7.96 million in political contributions last year, no correlation intended.
One provision of the bill would curtail efforts by the Department of Transportation to take another look at the carrier liability insurance minimum. It now stands at $750,000 but has not been changed since 1980, in spite of inflation.
Another would make it more difficult for the Federal Motor Carrier Safety Administration to try to reinstate the "34-hour restart" requirement established in 2013. That's the provision in the truck driver hours-of-service (HOS) rule that required drivers to get two consecutive rest periods between the hours of 1 and 5 a.m.
Most interesting and most concerning to many is a provision that would allow two trailers of up to 33 feet in length to be hauled in tandem—up from the 28-foot restriction now in place. What this has to do with appropriations is unclear, but the provision has the backing of FedEx, Con-way, and others. Proponents argue that this would cut down on the number of trucks on the highways, save fuel, and reduce greenhouse gas emissions. They also maintain that the new 84-foot-long rigs would pose no threat to highway safety. These arguments are similar to those put forward by supporters of raising truck weight limits a few years ago, albeit for different reasons. This time, the push is a response to the increased volume of lightweight packages resulting from the surge in e-commerce—a trend that is only expected to gather force. The Coalition for Efficient and Responsible Trucking, whose members include FedEx and UPS, predicts that this segment of traffic will grow 40 percent over the next 10 years.
Critics include Secretary of Transportation Anthony Foxx, who says that legislation of this type should not be included in appropriations bills, but rather, fully heard and debated in Congress, a logical objection in my view. The Truck Safety Coalition cites the potential for increases in truck-related deaths and injuries, and contends that provisions that cater to "special trucking interests" will raise risks to drivers and the general public.
The end result of all this remains to be seen, but so it goes in the hallowed halls of Congress.
The number of container ships waiting outside U.S. East and Gulf Coast ports has swelled from just three vessels on Sunday to 54 on Thursday as a dockworker strike has swiftly halted bustling container traffic at some of the nation’s business facilities, according to analysis by Everstream Analytics.
As of Thursday morning, the two ports with the biggest traffic jams are Savannah (15 ships) and New York (14), followed by single-digit numbers at Mobile, Charleston, Houston, Philadelphia, Norfolk, Baltimore, and Miami, Everstream said.
The impact of that clogged flow of goods will depend on how long the strike lasts, analysts with Moody’s said. The firm’s Moody’s Analytics division estimates the strike will cause a daily hit to the U.S. economy of at least $500 million in the coming days. But that impact will jump to $2 billion per day if the strike persists for several weeks.
The immediate cost of the strike can be seen in rising surcharges and rerouting delays, which can be absorbed by most enterprise-scale companies but hit small and medium-sized businesses particularly hard, a report from Container xChange says.
“The timing of this strike is especially challenging as we are in our traditional peak season. While many pulled forward shipments earlier this year to mitigate risks, stockpiled inventories will only cushion businesses for so long. If the strike continues for an extended period, we could see significant strain on container availability and shipping schedules,” Christian Roeloffs, cofounder and CEO of Container xChange, said in a release.
“For small and medium-sized container traders, this could result in skyrocketing logistics costs and delays, making it harder to secure containers. The longer the disruption lasts, the more difficult it will be for these businesses to keep pace with market demands,” Roeloffs said.
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
National nonprofit Wreaths Across America (WAA) kicked off its 2024 season this week with a call for volunteers. The group, which honors U.S. military veterans through a range of civic outreach programs, is seeking trucking companies and professional drivers to help deliver wreaths to cemeteries across the country for its annual wreath-laying ceremony, December 14.
“Wreaths Across America relies on the transportation industry to move the mission. The Honor Fleet, composed of dedicated carriers, professional drivers, and other transportation partners, guarantees the delivery of millions of sponsored veterans’ wreaths to their destination each year,” Courtney George, WAA’s director of trucking and industry relations, said in a statement Tuesday. “Transportation partners benefit from driver retention and recruitment, employee engagement, positive brand exposure, and the opportunity to give back to their community’s veterans and military families.”
WAA delivers wreaths to more than 4,500 locations nationwide, and as of this week had added more than 20 loads to be delivered this season. The wreaths are donated by sponsors from across the country, delivered by truckers, and laid at the graves of veterans by WAA volunteers.
Wreaths Across America
Transportation companies interested in joining the Honor Fleet can visit the WAA website to find an open lane or contact the WAA transportation team at trucking@wreathsacrossamerica.org for more information.