The USMCA Trade and how it compares to NAFTA.
There are a variety of articles which indicate where the changes are and how it will help US businesses. Below are a few links for review.
The USMCA Trade and how it compares to NAFTA.
There are a variety of articles which indicate where the changes are and how it will help US businesses. Below are a few links for review.
This article and report is a must read for anyone who is a senior manager or owner of a transportation or logistics company. Some great insight and ideas for companies to keep ahead of the game!
Link to original article in Transport Topics
GRAPEVINE, Texas — Trucking could be in for a period of improved conditions with the North American trade agreement updated and U.S.-China trade tensions eased, industry leaders said.
Over the past year, President Donald Trump’s trade war with China led to economic uncertainty. But an agreement on a phase one deal signals a more stable outlook on trade as well as business expansion.
Before those agreements, trucking’s customers had gotten “skittish,” said Chris Spear, president of American Trucking Associations.
In 2019, general economic activity, freight tonnage and rates all softened. Exports took a hit. Investment slipped, manufacturing orders fell and production lines slowed.
“We want stability,” Spear said. “We want certainty in the market.”
That may be at hand, but the deals have timetables that will require time to implement.
Trump is expected to add his signature Jan. 29 to the new United States-Mexico-Canada Agreement, which once agreed to by Canada, as expected, will establish detailed, phased-in updates to long-standing rules affecting trade in North America.
Trump on Jan. 15 signed the first phase of the China trade deal, after reaching a truce on the 18-month trade war between the two countries. The deal is projected to produce $33 billion in the first year and $45 billion in the second year from the export of U.S. manufactured goods, Spear said.
“We hope these agreements in place are going to bring the certainty that is necessary to bring manufacturing back online as an equal performer with construction and retail,” which make up the other pillars of freight movement, Spear said. “We look for probably as early as the latter half of 2020 to be a strong year for trucking.”
He made the comments at Heavy Duty Aftermarket Dialogue, during a discussion with Ann Wilson, senior vice president of government affairs at the Motor & Equipment Manufacturers Association.
Trucks move 76.5% of surface freight between U.S. neighbors — 81% and 72% of the border crossings with Mexico and Canada, respectively, Spear said.
For November alone, the U.S. Department of Transportation’s most recent data, trucks led transborder shipments with $62.7 billion in freight, down 4.1% from a year ago. U.S.-Canada freight movement was $28.3 billion while U.S.-Mexico accounted for $34.4 billion.
Freight moved across the borders by all modes of transportation tallied $99 billion in November, down 3.9% from a year ago, the agency said.
“We have a lot of work to do in terms of the implementation and to be certain [USMCA] is successful going forward,” Spear said.
That holds true for suppliers and manufacturers, too, said Wilson.
The goal with USMCA was not to change the underlying language of the earlier NAFTA agreement because if that had happened, “we were going to start back at zero,” and that would have prevented either keeping NAFTA or crafting something new, she said.
“As you look at this, I would make sure that there are people within your organization who understand where in the agreement the critical portions of the language are. You need to understand every single one of your tariff codes, where they fit in the agreement,” Wilson said. “And it’s mind bending. It looks like it is splitting hairs but, understand folks, that is how this agreement is put together. And that is how it is going to drive the content requirements and anything else that you do.”
A key aspect of USMCA, aimed at boosting manufacturing, requires vehicle manufacturers to ensure 70% of the steel and aluminum they use is purchased from North America, she added.
In part one of a two-part exploration of autonomous technology today, our latest RoadSigns podcast revisits conversations with CEOs Alex Rodrigues of Embark and Cetin Mericli of Locomation. Hear them explain what testing automated trucks and developing platooning technology has taught them about the road ahead — and get new perspective with host commentary. Listen to a snippet from Rodrigues above, and to hear the full episode, go to RoadSigns.TTNews.com.
The full benefits of the agreements will take time to ripple through the U.S., while growth is slowing in other global markets, said economists speaking at the event — with Germany already in an industrial recession.
Meantime, the U.S. economy is reverting to trend with GDP at 1.8% to 2%, amid “the longest economic expansion in U.S. history, 126 months of continuous growth,” said Bill Strauss, senior economist of the Federal Reserve Bank of Chicago.
How and who companies do business with is changing, and will continue to change, said Bob Dieli, economist at MacKay & Co., which presented the Heavy Duty Aftermarket Dialogue along with the Heavy Duty Manufacturers Association.
“We are in a trade war and supply chains won’t reset anytime soon,” Dieli said.
He suggested companies ask themselves three questions: How is your biggest customer doing? How is your biggest supplier doing? And how is your biggest competitor doing?
Also, a MacKay & Co. survey found top fleet concerns for 2020, respectively, are the technician shortage, the driver shortage and general economic activity.
The survey found wholesale distributors’ top concerns are general economic activity, the upcoming presidential election and tariffs.
January 7, 2020 at 5:30 pm
MARSHALL, Va. — Federal environmental regulators on Jan. 6 announced a call for public input to assist with the development of new guidance for emissions standards targeting commercial vehicles.
At a livestock exchange in the western part of Virginia, U.S. Environmental Protection Agency Administrator Andrew Wheeler explained the Cleaner Trucks Initiative aims to reduce oxides of nitrogen, or NOx, emissions and streamline regulations.
“The U.S. has made major reductions in NOx emissions, but through this initiative we will continue to reduce emissions, while spurring innovative new technologies, ensuring heavy-duty trucks are clean and remain a competitive method of transportation,” Wheeler said.
In its advance notice of proposed rulemaking unveiled Jan. 6, the agency explained the initiative is a “holistic rethinking of emission standards and compliance.” The public comment period will last 30 days after the notice is published in the Federal Register.
The input the agency receives would assist in shaping guidance to reduce in-use emissions under broad operating conditions. Additionally, the rule would be designed to enable effective technological solutions while considering cost impacts. It also would seek to promote fair and effective compliance and enforcement provisions, incentivize early compliance and innovation, ensure a coordinated nationwide program, and engage with stakeholders, the agency indicated.
EPA intends to unveil proposed guidance this year based on the feedback it receives, followed by a final rule possibly as early as 2021, the administrator indicated.
The Trump administration had announced in 2018 it would tackle this issue. EPA informed that a revision of NOx standards for on-highway heavy-duty trucks and engines occurred in 2001. According to estimates the agency provided, heavy-duty vehicles remain among the largest contributors to NOx emissions despite reductions of about 40% for such emissions between 2007 to 2017.
Several stakeholders who joined Wheeler at the announcement of the advance notice of proposed rulemaking applauded the agency’s move.
“ATA is committed to continuing to work closely with EPA on developing the next generation of low-NOx emitting trucks through the Cleaner Trucks Initiative,” American Trucking Associations Executive Vice President of Advocacy Bill Sullivan said. “To this end, the trucking industry seeks one national, harmonized NOx emissions standard that will result in positive environmental progress while not compromising truck performance and delivery of the nation’s goods.”
“EPA’s announcement on the Cleaner Trucks Initiative is a productive step toward updating standards for on-highway heavy-duty trucks and engines to reduce emissions of nitrogen oxides and particulate matter,” Association of Air Pollution Control Agencies Executive Director Jason Sloan said.
Funding for freight safety programs would be increased and infrastructure grants would receive $1 billion under fiscal 2020 legislation Congress cleared for President Donald Trump on Dec. 19.
The two-bill package that would allocate $1.4 trillion for the federal government was passed by the U.S. Senate on a 71-23 vote. Tucked in one of the measures is $1 billion for the Better Utilizing Investments to Leverage Development, or BUILD, grants. Also in the bill, the Federal Motor Carrier Safety Administration would receive $679 million, $12 million above the 2019 enacted level.
Enactment of the funding package would avert a shutdown of most federal agencies. Trump tweeted his praise for the spending bills and said he’ll sign them on Dec. 20.
“All in all, these bills accommodate countless member priorities on both sides of the aisle,” said Appropriations Committee Chairman Richard Shelby (R-Ala.).
“Notwithstanding the president’s denial that climate change exists, the agreement includes significant resources to combat this threat in the new fiscal year,” added Sen. Patrick Leahy (D-Vt.), ranking member of the Appropriations Committee. “We must take action, and we must take action now. This bill gets us on the right path.”
The legislation had advanced from the U.S. House of Representatives on Dec. 17 by a vote of 297-120.
“I’m pleased that we have reached a bipartisan agreement that will keep government open, provide the certainty of full-year funding and make strong investments in key priorities for American communities,” said House Appropriations Committee Chairwoman Nita Lowey (D-N.Y.). “With higher spending levels in line with the bipartisan budget agreement, we are scaling up funding for priorities that will make our country safer and stronger and help hardworking families get ahead.”
Overall, under the domestic spending bill, the U.S. Department of Transportation would receive $86.2 billion, a decrease of about $324 million from the 2019 enacted level. Related to trucking policy, the measure would prohibit funding for the enforcement of the electronic logging device mandate for livestock or insect haulers. Under the bill, FMCSA also would be required to update inspection regulations for rear underride guards.
The bill also directs the trucking regulatory agency to comply with certain recommendations by the National Academies of Sciences, Engineering, and Medicine before making Compliance, Safety, Accountability data available to the public. That data pertains to metrics designed to calculate commercial transportation performance on the highways.
For other agencies, the bill would provide $49.3 billion for the Federal Highway Administration, $17.6 billion for the Federal Aviation Administration, $12.9 billion for the Federal Transit Administration, $2.8 billion for the Federal Railroad Administration and $989 million for the National Highway Traffic Safety Administration.
The bill would provide $1 million for the Office of the Transportation Secretary to proceed with the National Academies of Sciences, Engineering, and Medicine on a study about the effective ways to evaluate the resilience of transportation systems, as well as services for natural disasters and hazards.
As part of the funding measures, Congress also advanced soon-to-expire tax breaks referred to as “extenders.” Among the “extenders” was an extension of the 50 cents-per-gallon alternative fuel excise tax credit, as well as a credit for the installation of alternative-fuel vehicle refueling property in service before 2020.
Several stakeholders applauded approval of the extenders.
“This bipartisan budget agreement wisely includes provisions aimed to promote the use of clean, domestic natural gas in transportation,” NGVAmerica President Daniel Gage said. “Congress signals how important clean-technology natural gas vehicles are to growing our economy, improving our air quality and enhancing our energy security while reducing our carbon footprint.”
November 27, 2019 at 9:48 pm
Making a decision about which one to utilize can be based on a variety of reasons…typically these reasons come down to two…Budget and Features!
There are a number of new regulations coming soon that have the potential to hit the trucking industry hard. Individually, each regulation may not move the needle much, but combined, they could turn the trucking environment from one of excess capacity to situation where trucks are hard to find.
The regulation requiring Electronic Logging Devices (ELDs) for tracking a driver’s hours of service (HOS) took effect on Dec. 17, 2017. However, trucks using the older Automatic Onboard Recording Devices (AOBRDs) were given 2 more years to switch over to ELDs.
While few expect the switchover to be as disruptive as the ELD mandate in 2017, it could be enough to decrease productivity and tighten capacity, especially because it hits at one of the busiest times of the year for freight. The December 2017 mandate contributed to a spike in rates, which stayed elevated throughout 2018.
Carriers using AOBRDs are more likely to be the larger carriers, so that’s a lot of trucks. And those who wait till the last minute to switch may encounter glitches running new software or hardware. According to John Seidl, Vice President of Risk Services for Reliance Partners and a former FMCSA investigator, the biggest challenge is training drivers properly in the use of ELDs so carriers can avoid hits to their CSA scores.
Starting Jan. 1, 2020 ocean vessels are required to switch to ultra low sulfur fuels. The distillate used to create these fuels is the same that is used for diesel fuel. That means that distillates normally dedicated to diesel will be diverted to marine fuels. According to current estimates, this could cause diesel prices to spike 25 cents per gallon or more.
Besides labor costs, fuel is the second biggest expense for a carrier, and a sudden sharp rise in diesel prices could drive some carriers out of business. A report issued this past summer by FreightWaves and Michigan State University professor Jason Miller examined 30 years of truck failure data. The report noted: “The biggest surprise to most outside of trucking industry professionals would be that failures are not primarily caused by spot and contract rates falling steeply in a recession. Instead, failures are primarily due to huge spikes in diesel prices that smaller carriers cannot pass on.”
Beginning Jan. 6, 2020, trucking companies are required to use the FMCSA’s Drug and Alcohol Clearinghouse, a new online database that gives employers access to information about CDL driver drug and alcohol violations. Currently, a driver who is fired from a job for drug use can often obtain a job with a different carrier in a different state. The clearinghouse is intended to prevent that by making it easier to identify drivers with prior violations.
The clearinghouse could weed out even more drivers if the FMCSA decides to permit hair follicle testing as an acceptable alternative to urine testing. Urine samples can detect drug use in the past few days, but hair follicle testing can detect drugs for up to 2-3 months. In June, the Trucking Alliance testified to Congress that they estimate that more than 300,000 CDL holders would either fail or refuse to take a hair analysis test. That would dramatically reduce the number of qualified drivers.
New overtime rules take effect in 2020, which the U.S.Department of Labor says will make an additional 1.3 million Americans newly eligible for overtime pay.
While the new rules likely won’t be an issue for most truck drivers, who are paid by the mile, they may affect both carriers and brokerages with back-office staff. The new rules increase the salary threshold for employees to be exempt from overtime, rising from the current $23,660 to $35,568.
In addition, only 10% of commissions and bonuses can be counted as part of an employee’s salary. For example, if an employee earns $20,000 in salary and $30,000 in commissions, the employer would only be able to count $23,000 as the employee’s salary and would therefore be required to pay overtime.
In the trucking industry, it’s common for carriers to “lease on” owner-operators as independent contractors and brokers to take on “agents” as independent contractors. That practice will be severely curtailed in California with the implementation of Assembly Bill 5, which starts Jan. 1, 2020.
AB5 states that workers must meet three criteria to be classified as independent contractors, commonly referred to as the “ABC test.”
A. The worker must be free from control and direction of the hiring entity.
B. The work performed must be outside the usual course of the hiring entity’s business.
C. The worker must be engaged in an independently established trade, occupation or business.
That second requirement is virtually impossible for a trucking company to meet because driving trucks is part of a trucking company’s core business. News outlets have reported that trucking companies are sending out notices to their California-based leased-on drivers notifying them they have a few choices, including becoming a company driver, getting their own operating authority, or moving out of California.
Traffic in Aurora, Colo. This stretch was one recipient of a BUILD grant. Traffic stopped due to weather on Interstate 70 in Aurora, Colo. This stretch will benefit from a BUILD grant. (David Zalubowski/Associated Press)
Transportation Secretary Elaine Chao has announced the latest recipients of the Better Utilizing Investments to Leverage Development discretionary grants.
Some $900 million will be dispersed across 35 states to support 55 infrastructure projects. The grants, announced Nov. 12, help fund road, bridge, transit, rail, port and intermodal transportation projects. The BUILD program is meant as a replacement for the Transportation Investment Generating Economic Recovery (TIGER) program, which was popular with state and local agencies.
FMCSA’s hours-of-service (HOS) proposal was released.
“The Administration is targeting BUILD transportation grants to repair, rebuild and revitalize significant infrastructure projects across the country,” Chao said.
No individual grant was more than $25 million, and no state was awarded more than $90 million. Half of the funding was awarded to projects in rural areas.
North Carolina received three grants. One, for $22.5 million, was awarded to the North Carolina Department of Transportation to make various improvements to Interstate 95, such as widening 27 miles of the route and rebuilding overpasses. A second grant, for $15 million, will be used to reconstruct roadways and realign intersections in Greenville to improve mobility and safety in the city. Some $13 million will be used to construct connector roads in the town of Mooresville, which straddles I-77.
The port of Massachusetts will benefit from a BUILD Grant.
A crane lifts a container at the Conley Terminal. (Massachusetts Port Authority.)
“The highly competitive BUILD grant program provides federal funding for major infrastructure projects — including multimodal and multijurisdictional projects — that improve our transportation networks and enhance quality of life,” said Rep. David Price (D-N.C.), chairman of the House appropriations subcommittee on Transportation, Housing and Urban Development and Related Agencies.
In Colorado, the city of Aurora was awarded $25 million to build a new interchange at the intersection of I-70 and Piccadilly Road, which is meant to ease congestion in the growing area. I-70 is Colorado’s main east-west corridor.
A $20 million grant will help the Massachusetts Port Authority expand the Conley Container Terminal in Boston. The federal funding is expected to help the terminal increase its volume capacity by 100,000 containers.
“As someone who previously worked at Conley Terminal as an ironworker, I am especially pleased to see Massport receive this major federal grant to help expand our freight facilities,” said Rep. Stephen Lynch (D-Mass.). “This $20 million will help increase capacity and efficiency at Conley Container Terminal and continue to provide high quality blue-collar jobs for our state and the New England region.”
Some $18 million was awarded to help extend a three-mile portion of U.S. Route 30 in East Canton, Ohio, which is about 65 miles southeast of Cleveland. The extension is meant to increase economic opportunities in the area.
“This grant will help complete the important expansion work that the city is undertaking and boost opportunities for economic growth and job creation,” said Sen. Rob Portman (R-Ohio). “Opening access to the trucking industry on Route 30 is critical for the safety conditions and growing energy industry in the Marcellus and Utica shale region in Northeast Ohio.”
Projects are selected on the basis of a number of factors, including safety, economic competitiveness, environmental sustainability, innovation and partnerships with industry representatives.
STATE CITY/COUNTY PROJECT GRANT FUNDING EST. PROJECT COSTS
AK Anchorage Petroleum and Cement Terminal $25,000,000 $171,578,584
AL Florence Additional Lanes on US-72 (Florence Boulevard) $14,880,000 $19,850,000
AL Madison County Blake Bottom Road Widening Project $9,268,804 $11,586,005
AL Baldwin Waterway Village Multimodal Access Project $14,404,831 $23,000,000
AZ Florence Inland Port Arizona Improvement Project $15,373,698 $18,073,699
AZ Phoenix Phoenix Sky Harbor Northside Rail Expansion $24,000,000 $239,057,522
CA Lancaster GROW LIFE: Growing Regional Opportunity with Leveraged-Infrastructure Fleet Expansion $8,683,480 $14,014,352
CA Fresno Veterans Boulevard Interchange, Extension and Grade Separation Project $10,540,582 $71,663,764
CO Colorado Springs Colorado Military Access, Mobility and Safety Improvement Project $18,350,000 $127,400,000
CO Aurora I-70/Picadilly Interchange $25,000,000 $56,600,000
FL Jacksonville International Cargo Terminal Modernization Project $20,000,000 $72,700,000
FL Orlando The Orange County Local Alternative Mobility Network Project $20,000,000 $40,009,169
FL Miami The Underline Multimodal Mobility Corridor $22,360,552 $69,941,592
HI Honolulu Ala Moana Boulevard Elevated Pedestrian Walkway $20,000,000 $30,000,000
IA Des Moines Central Iowa Water Trail: Phase 1 Dam Mitigation and User Access Project $25,000,000 $31,250,000
IA Dubuque Northwest Arterial/John Deere Road Corridor $5,452,023 $10,545,029
IL Carbondale Southern Illinois Multi-Modal Station (SIMMS) $13,986,000 $17,482,500
IL Normal The Underpass Project at Uptown Station $13,000,000 $22,692,120
IN Boone County I-65 Mobility and Access Project $16,000,000 $50,600,000
KS Olathe Interstate 35 & 119th Street Interchange Reconfiguration Project $10,000,000 $25,400,000
KS Hays Northwest Business Corridor Truck Route Road Improvements $6,506,686 $10,787,131
KY Paris BUILD US 460 $10,200,000 $17,318,000
KY Campbellsville Heartland Parkway $9,800,000 $21,250,000
KY Paducah Paducah Riverfront Infrastructure Improvement Project $10,400,000 $11,492,296
LA Ruston Monroe Street Corridor Project $17,191,530 $23,699,899
LA Baton Rouge Plank-Nicholson Bus Rapid Transit $15,000,000 $40,218,000
MA Boston Conley Terminal Container Storage and Freight Corridor $20,000,000 $65,841,791
ME Lubec Lubec Safe Harbor $19,650,000 $19,689,750
ME Augusta Station 46 Bridge Replacement Project $25,000,000 $30,000,000
MO Milan East Locust Creek Reservoir (ELCR) Improvements $13,459,009 $22,686,610
MO Springfield Grant Avenue Connect Parkway Project $20,960,822 $26,201,028
MS Gulfport Interconnecting Gulfport $20,460,000 $32,220,000
MS Starkville MS 182/MLK Corridor Revitalization Project $12,655,840 $15,818,724
MT Missoula County Mullan BUILD: Proactively and Collaboratively Building a Better Missoula $13,000,000 $28,372,000
NC Robeson and Cumberland Counties I-95 Resiliency and Innovative Technology Improvements $22,500,000 $685,115,000
NC Mooresville Silicon Shores East-West Connector Road $13,609,131 $21,730,195
NC Greenville Transportation Accessibility, Safety and Connectivity (TASC) Project $15,000,000 $24,000,000
NE Omaha 120th Street Improvements $16,960,000 $21,200,000
NH/VT Hinsdale, N.H., and Brattleboro, Vt. Vermont/New Hampshire Route 119 Bridge Project $12,000,000 $50,000,000
NM Santa Fe US285 Safety and Resiliency Project $12,500,000 $115,000,000
OH Canton US Route 30 Freeway Extension Project $18,000,000 $116,675,110
OR Medford Southern Oregon Corridor Resiliency and Congestion Relief Project $15,500,000 $39,370,000
PA Philadelphia PATCO Franklin Square Station Reopening Project $12,580,000 $25,160,000
PA Allegheny County PIT Cargo Building 4 Intermodal Freight Transfer Facilities Development $18,690,047 $23,362,559
RI Providence Washington Bridge Rehabilitation and Redevelopment Project $25,000,000 $70,000,000
SC Charleston Ashley River Crossing $18,149,750 $22,749,750
SD Brookings Bridging the Interstate Divide $18,677,630 $23,347,037
TN Memphis Memphis Innovation Corridor $12,000,000 $73,831,000
TX Beaumont Multimodal Corridor Expansion and Improvement Project $18,000,000 $101,245,000
TX Houston Shepherd and Durham Major Investment Project $25,000,000 $50,000,000
WA Everett Mills to Maritime Property Acquisition $15,500,000 $27,700,000
WA Spokane Rail-Truck Transload Facility Project $11,300,000 $16,900,000
WI Odanah Old Odanah Road (County A) Bear Trap Road Project $2,376,808 $2,704,808
WV Charleston I-64 Widening: Nitro to St. Albans Project $20,000,000 $265,000,000
WY Sublette County Dry Piney Creek Wildlife Habitat Connectivity $14,544,000 $18,180,000
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