Industry News

Truck Weight Debate Returns To Capitol Hill

Tue, 27 Aug 2013 18:46:45 GMT

On May 7, Senator Frank Lautenberg (D-NJ) re-introduced his Safe Highways and Infrastructure Preservation Act (SHIPA) proposed legislation to the Senate. Lautenberg’s bill would expand the existing ban on tractor trailer combinations with weights exceeding 80,000 lbs. Gross Vehicle Weight (GVW), which currently applies on interstate highways, by extending it to all national highways. In contrast, on February 12, 2013, Rep. Michael Michaud (R-ME) reintroduced his Safe and Efficient Transportation Act (H.R. 612). SETA would allow states to raise gross vehicle weight limits on all highways, including interstates and national highways, to 97,000 lbs., with the addition of a sixth axle and additional wheels and tires.

NASSTRAC supports SETA and opposes SHIPA. By reducing the trucking industry’s ability to use heavier and/or longer vehicles, the Lautenberg bill would reduce trucking industry productivity while also increasing highway congestion and doing nothing to improve safety. If motor carriers and shippers are blocked from using heavier and/or longer vehicles, projected increases in freight volume will have to move in increasing numbers of current, 80,000 lb. GVW-limited tractor trailers.

"Sen. Lautenberg’s SHIPA bill exemplifies the War on Trucking that has long been a focus of NASSTAC advocacy efforts,” says Mike Regan, Chairman of NASSTRAC’s Advocacy Committee. "One of the key points we will make during the next Washington, DC Fly-In will be that SHIPA is a bad bill. NASSTRAC supports the Coalition For Transportation Productivity’s position and is working with them to get common-sense legislation that will save billions of dollars annually and enhance safety on the roads.”

> More at FreightTalk, NASSTRAC’s Blog

Oklahoma Tornado Disaster Relief Needs

Tue, 27 Aug 2013 18:49:26 GMT

There is a solid strategic partnership between NASSTRAC and the American Logistics Aid Network. ALAN’s web portal serves as a clearinghouse for essential supplies, goods, and services during times of crisis, including disasters like the tornado disaster in Oklahoma this last week. ALAN’s solution to emergency relief brings together the unique capabilities of business (members of NASSTRAC) and voluntary organizations plus relief agencies – forming strong partnerships between public, private, and non-profit organizations.

> More at FreightTalk, NASSTRAC’s Blog

Revlon’s Sherry (Askew) Ennis Joins NASSTRAC Executive Committee

Tue, 27 Aug 2013 18:50:40 GMT

NASSTRAC announces that Sherry Ennis has been recently named to its Executive Committee, the trade association’s primary governing and leadership team. Ennis is Transportation Manager of Revlon Consumer Products, and has nearly 20 years experience in transportation and logistics. She has been a member of NASSTRAC since 2004 and was active on the association’s Education Committee in planning its 2013 Shippers Conference. A certified logistics professional by the Institute of Logistics Management, Ennis is pursuing a bachelor of science degree in logistics management from Barton College, and previously was a logistics instructor at Vance Granville Community College in North Carolina.

NASSTRAC Creates New Student Scholarship Program

Tue, 27 Aug 2013 18:51:40 GMT

In an effort to provide learning and networking opportunities to college-level students coming into the industry, NASSTRAC launched its annual Transportation & Supply Chain Scholarship Program this year. Through this program, NASSTRAC provided financial resources that enabled three individuals in transportation/supply chain academic programs to attend this year’s conference. Scholarship recipients (pictured, left to right) are Jason Klanac, student from Georgia Southern; Edward Mraz, student from University of West Florida; and Bradley Addison, student at Auburn University. The program was implemented under the leadership of Marc Feeser, Sr. Manager, America’s Fulfillment & Logistics, at Dell Inc.; and Brian Gibson, Ph.D, Wilson Family Professor of Supply Chain Management, Auburn University.

> Read Jason Klanac’s perspectives at FreightTalk

Transportation Executives Learn, Network at NASSTRAC’s Shippers Conference In Orlando

Tue, 27 Aug 2013 18:55:04 GMT

Transportation Executives Learn, Network at NASSTRAC’s Shippers Conference In OrlandoNearly 600 transportation industry decision-makers and providers recently met at the 2013 Shippers Conference & Transportation Expo in Orlando to learn, network, and do business. Shippers from such leading manufacturers as Anixter, Ashland, Avery Dennison, BASF, Baxter Healthcare, Dixon Ticonderoga, Ecolab, Frito Lay, Kraft Foods, L’Oreal, Masco, Merck, MOM Brands, Scotts Miracle-Gro, Owens & Minor, Revlon, Zodiac Pool Systems; and retailers/ distributors such as BJ’s Wholesale Club, Coach, Dots, Floor & Décor, Sherwin-Williams, and United Stationers. The event also featured more than 100 providers as part of the expo, including providers and carriers of all modes, and technology innovators."

This event promoted strategic thinking, learning, and invaluable networking for freight transportation and supply chain executives,” says Candace Holowicki, NASSTRAC’s Education Committee Chairwoman and Director of Global Transportation and Logistics for manufacturer TriMas Corp. "NASSTRAC continues to provide high-level content, practical ideas, and networking opportunities that help those of us in this industry to increase efficiencies, streamline the supply chain, and strengthen the bottom line for our organizations.” Visit NASSTRAC’s Blog, www.FreightTalk.org for more of Candace’s perspectives.

> Conference Recap

Stein Mart’s Gregg Sayers Joins NASSTRAC Executive Committee

Tue, 27 Aug 2013 18:57:08 GMT

NASSTRAC announces that Gregg Sayers has been recently named to its Executive Committee, the trade association’s primary governing and leadership team. Sayers is Director Supply Chain/Transportation at Stein Mart, a fashion retailer offering a distinctive assortment of apparel, acces¬sories and shoes for women and men and home fashions. Sayers provides strategic and tactical direction and leadership for international and domestic transporta¬tion activities supporting Stein Mart’s overall supply chain strategies. Previously, he served as director with Performance Team Freight Systems, a leading third-party logistics company based in Santa Fe Springs, Calif. He also was in a number of transportation leadership and distribution center operations roles at Limited Brands. Sayers holds a degree from Hobart College, Geneva, N.Y. Sayers has been an active NASSTRAC member since 2011, and was Stein Mart’s primary representative in accepting NASSTRAC’s Shipper of the Year award on behalf of the retailer that year.

According to NASSTRAC President Doug Easley, Sayers will work strategically with the Executive Committee to ensure the association achieves its mission in providing quality education, advocacy, and provider relations opportunities to shippers and other stakeholders in North American transportation. "Sayers brings considerable leadership and industry expertise to the table,” he says, "and we look forward to his contribution to our association and to the transportation industry at large.”

NASSTRAC Creates New Student Scholarship Program

Tue, 27 Aug 2013 18:58:06 GMT

In an effort to provide learning and networking opportunities to college-level students coming into the industry, NASSTRAC launched its annual Transportation & Supply Chain Scholarship Program this year. Through this program, NASSTRAC provided financial resources that enabled three individuals in transportation/supply chain academic programs to attend this year’s conference. Scholarship recipients (pictured, below right) are Jason Klanac, student from Georgia Southern; Edward Mraz, student from University of West Florida; and Bradley Addison, student at Auburn University. The program was implemented under the leadership of Marc Feeser, Sr. Manager, America’s Fulfillment & Logistics, at Dell Inc.; and Brian Gibson, Ph.D, Wilson Family Professor of Supply Chain Management, Auburn University.

> Read "Perspectives From The Student Supply Chain”

Obama Taps Charlotte Mayor Anthony Foxx To Succeed LaHood at DOT

Tue, 27 Aug 2013 18:58:47 GMT

President Obama has nominated Charlotte, N.C., Mayor Anthony Foxx to be the next secretary of transportation, succeeding Ray LaHood, who is stepping down. Obama named Foxx as his choice to lead DOT at a White House ceremony Monday afternoon. Following his formal nomination, Foxx must be confirmed by the Senate. Foxx, a Democrat, has expanded public transportation systems in his city, has developed a facility connecting freight to global ports and has added a third runway at Charlotte/Douglas International Airport, the Washington Post reported Monday. Foxx, 42, has been Charlotte’s mayor for nearly four years.

Diesel Drops .6 Cents to $3.845 Per Gallon

Tue, 27 Aug 2013 19:00:13 GMT

Diesel prices dropped .6 cents a gallon, its 10th straight weekly decline, while gasoline rose for the first time in 10 weeks, the U.S. Department of Energy reported to NASSTRAC this week. Gasoline rose 1.8 cents to $3.538 a gallon following nine declines in which it fell 26.4 cents. The smallest of its recent declines left diesel 21.2 cents below the same week lsat year, while gasoline is 25.2 cents under a year ago. Diesel prices, which have not risen since Feb. 25, have dropped 31.4 cents in the past week, according to the DOE.

> View Prices

FMCSA Denies Hours Of Service Delay

Tue, 27 Aug 2013 19:01:44 GMT

The Federal Motor Carrier Safety Administration announced it won’t delay the July 1 start date for enforcing the latest changes to its HOS rule for truck drivers. In January, American Trucking Associations asked FMCSA not to enforce parts of the rule until three months after pending litigation ends. The U.S. Court of Appeals for the District of Columbia Circuit is scheduled March 15 to hear oral arguments in the case.

FMCSA responded in a Feb. 22 letter to ATA, according to Transport Topics, with this statement: "Mere uncertainty over the possible outcome of the litigation, which you recognize is a matter over which the parties differ, does not create likelihood that the industry or the enforcement community will suffer harm due to wasted training resources or confusion.” However, FMCSA said it believes the rule is valid and not likely to be delayed if ATA asked a federal court to impose a stay, or court-ordered delay.

ATA opposes a provision of the rule that restricts use of the 34-hour restart. It allows truck drivers to reset their weekly driving limits of 60 hours in seven days, or 70 hours in eight days, if they rest for 34 hours. Truck drivers will now be able to use the restart only once every seven days, and the restart will have to include two periods from 1 a.m. to 5 a.m.

NASSTRAC joined ATA and other shipper and carrier interests in filing a brief Oct. 1 in the U.S. Court of Appeals for the D.C. Circuit, which is considering challenges to FMCSA’s latest rules. This brief supports the FMCSA decision to retain the 11th hour of daily driving time, based upon findings that the benefits of that decision outweigh costs. NASSTRAC also supports ATA’s goal of more flexibility as to restarts between workweeks. Visit www.FreightAdvocacy.org for more information on NASSTRAC’s advocacy initiatives.

Diesel Declines 2.9 Cents to $4.13 Per Gallon

Tue, 27 Aug 2013 19:03:05 GMT

Diesel prices fell for the first time in seven weeks, dropping 2.9 cents to $4.13 per gallon, and gasoline prices fell for the first time this year, the U.S. Department of Energy reported to NASSTRAC this week. Diesel price’s first downturn since Jan. 14 left it 3.6 cents over the same week last year, while gas is now 3.4 cents below the same time a year ago. Diesel, the trucking industry’s main fuel, had gained 26.5 cents in six previous increases, including a jump of 23.2 cents last month, leaving its highest February level on record last week – at $4.159 per gallon. Gasoline prices had experienced significant elevation as well, jumping 53 cents in 11 consecutive gains. Last week’s diesel per-gallon price was the hightest since August 2008, according to DOE. Each week, DOE surveys about 350 diesel filling stations to compile a national snapshot of average prices.

> View Prices

NAFTA Surface Trade Drops 3.2% In December

Tue, 27 Aug 2013 19:05:07 GMT

Surface trade activity among the U.S., Canada and Mexico fell 3.2% in December from the same month a year earlier, according to the U.S. Department of Transportation. Trade among the North American Free Trade Agreement partners declined to $71.9 billion, DOT’s Bureau of Transportation Statistics said in its monthly report. Month-to-month trade, which is impacted by seasonal factors, dropped 11.7% from November. U.S.-Canada trade fell 4.7% year-over-year to $42.1 billion, while U.S.-Mexico trade dipped 0.8% to $29.8 billion. Truck imports to the U.S. from the two countries declined 3.2% year-over-year to $23.2 billion, while exports dropped 5.1% to $24.8 billion. Rail imports increased 3.6% to $9 billion, while exports gained 5.2% to $4.7 billion.

NASSTRAC Forges New Media Relationship With Supply Chain Digital

Tue, 27 Aug 2013 19:06:20 GMT

NASSTRAC forged a new media relationship with Supply Chain Digital & Business Review North America. As part of this new relationship, special reports about NASSTRAC will be featured in the upcoming issues of Supply Chain Digital & Business Review North America. The publication also will be producing a full digital marketing campaign, including a new NASSTRAC brochure for use over the coming months.

Besides interviews with NASSTRAC on the mission, goals, and role of our organization, there is also an opportunity for several member companies to be profiled, showcasing their business, activities, services, etc. Once available, the report will also be published online in their two trade publications and reproduced into a customized company brochure. In addition, participating companies will receive a Corporate Profile on their brand new social media platform ‘BusinessFriend’, view the WIT link as an example.

Supply Chain Digital is an online magazine which is emailed to over 81,000 individual senior industry executives within the supply chain, transportation, and logistics market; and every issue focuses on the latest in operational excellence. To view the latest issue you can visit www.supplychaindigital.com. Business Review North America is an online magazine which is emailed to over 385,000 individual executives across a vertical market within the US & Canada. To view the latest issue you can visit www.businessreviewnorthamerica.com. Please note that there is no cost to be profiled in the magazine.

For more information, contact Michael Magno, Executive Director, at 978-279-9151 or byemail.

Diesel Rises 8.2 Cents In Fourth Straight Increase

Tue, 27 Aug 2013 19:08:11 GMT

Diesel rose 8.2 cents to $4.104 a gallon, the fourth straight increase and the highest price since October, while gasoline rose for an eighth week, the U.S. Department of Energy reported to NASSTRAC this week. Gasoline rose 7.3 cents to $3.611 a gallon and has risen 35.7 cents in eight straight weeks of increases. Both fuels’ prices are the highest since Oct. 22, when diesel was $4.116 and gas was $3.687. The diesel price increase follows last week’s increase of 9.5 cents, for a combined two-week jump of 17.7 cents, the biggest price increase in nearly two years. Diesel has risen 22 cents in four weeks of increases, after dropping 14 cents in seven consecutive previous declines. Each week, DOE surveys about 350 diesel filling stations to compile a national snapshot of average prices.

> View Prices

Ports Reach Tentative Deal To Avoid Strike

Tue, 27 Aug 2013 19:09:03 GMT

Port operators have reached a tentative deal on a new contract with the longshoremen’s union, averting a possible strike that would have crippled operations at 15 East Coast and Gulf Coast ports, the Associated Press reported. The deal was announced late last week in a statement from federal mediator George Cohen, director of the Federal Mediation and Conciliation Service. Cohen, who has been leading the talks since last year, said the agreement was subject to ratification by both parties and to additional local union negotiations, AP reported. But he said that local talks would continue without the threat of interrupting port operations, while declining to offer any details on the deal.

Shippers have been anxiously awaiting the tentative pact and are looking for the parties to quickly complete any outstanding negotiations, including local negotiations at each of the ports, and quickly ratify the new labor agreement. Many shippers believe the new contract will bring needed supply chain certainty and predictability for manufacturers, retailers, and other industries that rely on the ports to move the nation’s commerce and trade – something very important to NASSTRAC members as well.

Both the union and the port operators have been in intense negotiations since the previous contract ended in September, and the International Longshoremen’s Association and port operators agreed in late December to extend contract negotiations into early February. Cohen and the mediation service helped end an eight-day strike at the Ports of Los Angeles and Long Beach late last year.

Postal Service Plans To End Saturday Mail Delivery

Tue, 27 Aug 2013 19:10:05 GMT

The U.S. Postal Service has announced that it plans to end Saturday mail delivery by as soon as August to cut financial losses. Postmaster General Patrick Donahoe said the postal service, which lost $15.9 billion last year, can make the change without Congress’s approval, if necessary. The change would cut 22,500 full-time jobs and reduce costs by as much as $2 billion a year, said Donahoe. Job cuts can be made by attrition and buyouts, he said at a news conference in Washington.

The postal service will continue six-day deliveries of packages, deliver mail to post-office boxes and keep retail locations open that now operate on Saturdays, Bloomberg reported. Package carriers UPS and FedEx rely on the post office for last-mile delivery of packages sent using their cheaper SurePost and SmartPost services, respectively. The Postal Service determines the date of the final delivery and could hold some of those packages until Monday. Shippers continue to await updates on this development, as it could significantly impact many supply chains and operations, and NASSTRAC will continue to closely monitor developments.

Diesel Drops 1.7 Cents to $3.894 Per Gallon

Tue, 27 Aug 2013 19:12:20 GMT

Diesel prices per gallon declined 1.7 cents, the sevenths straight decline, the U.S. Department of Energy reported to NASSTRAC this week. Despite the dip, the main fuel in trucking is 4 cents higher than the same week last year. Meanwhile, gasoline increased slightly (by 0.4 cents) to $3.303 per gallon. Gas has gained nearly a nickel in four straight gains, yet its price this week is 8.8 cents below a year ago. Diesel has dropped 14 cents in seven straight declines since the last week in November, at which time it rose 5.8 cents. That was preceded by five drops totaling 17.4 cents, according to DOE statistics. For diesel this last week, the Midwest region saw the biggest drop, where it fell 3.6 cents to $3.834 per gallon. However, diesel prices rose in the New England region (by 1.5 cents to $4.168 per gallon) and in California (by 1.5 cents to $4.063).

States Begin Work On Transportation Plans for 2013

Tue, 27 Aug 2013 19:13:20 GMT

Now that it’s the new year, states throughout the country are beginning work on their own individual transportation plans. Many states are setting plans for transportation spending and beyond as they also seek public input and announce new proposals.

In Virginia, Gov. Bob McDonnell (R) announced a proposal last week to remove the states gasoline tax, making that state the first in the country to eliminate the tax. The flat gas tax of 17.5 cents per gallon does not fluctuate with inflation, and higher-mileage cars are reducing overall revenue. Virginia’s diesel tax, also at 17.5 cents per gallon, would remain in place and not be eliminated under the plan, which also would impose a $100 annual surcharge on alternative-fuel vehicles, including those that run on natural gas. The plan is expected to raise more than $3 billion for transportation over five year and would boost the amount of money going to transportation from sales taxes from the current 0.5 cents to 0.75 cents in that time.

Meanwhile, Missouri needs $1 million more a year for necessary infrastructure improvements, according to a recent report by a special task force. The task force did not lay out a funding plan but suggested possible options such as bonds, toll roads, a sales tax increase, or fuel tax increases, according to the Associated Press. Kentucky currently is seeking public input as it updates a 20-year long-range transportation plan. A recent public survey found needs and focus on maintenance, improving existing roadways, and new roads to be critical. Massachusetts has delayed releasing its transportation plan until this coming week to refocus the report on transportation as an economic driver. Gov. Deval Patrick (D) for the state has previously supported boosting the state’s gasoline tax but has recently gone on record to say he’s not sure that is a solution to the state’s transportation financing shortfall.

Shippers should pay close attention to developments in the states where they have operations.

Supreme Court To Hear ATA Challenge of LA Clean-Trucks Program

Tue, 27 Aug 2013 19:13:55 GMT

The U.S. trade deficit was $42.2 billion in October, widening 5 percent from $40.3 billion in September, according to the U.S. Census Bureau and the U.S. Bureau of Economic Analysis. These two units of the Dept. of Commerce said October exports were valued at $180.5 billion, down $6.8 billion from September exports of $187.3 billion, a decrease from September imports of $227.6 billion. The goods deficit increased $1.8 billion from September to $59.2 billion, and the services surplus decreased $0.1 billion from September to $16.9 billion. The goods and services deficit decreased $3.5 billion from October 2011 to October 2012.

An Example of Advocacy: NASSTRAC Encourages Obama Administration To End Work Stoppage At Ports

Tue, 27 Aug 2013 19:15:59 GMT

NASSTRAC, along with other industry associations, signed on a letter last month to President Obama encouraging the administration to quickly engage in the situation to end the work stoppage at the ports of Los Angeles and Long Beach. NASSTRAC members had significantly concern about the situation’s negative impact on supply chain disruption.

> View Letter

Diesel Drops 3.6 Cents; Gasoline Prices Also Drop

Tue, 27 Aug 2013 19:16:59 GMT

Diesel prices fell 3.6 cents to $3.991 a gallon, while gasoline continued to drop as well, the Department of Energy reported to NASSTRAC Monday. Gasoline fell 4.5 cents to $3.349 a gallon, its 10th decline in the past 12 weeks. Since mid-September, it has dropped significantly, by 52.9 cents. The diesel decline remains the price per gallon under $4 for the third time in the past 17 weeks, even though it has dropped in seven of the past eight weeks. Each week, the DOE surveys about 350 diesel filling stations nationwide to compile a national snapshot average price.

FMCSA Activates Changes to CSA

Tue, 27 Aug 2013 19:21:53 GMT

The Federal Motor Carrier Safety Administration recently announced it activated previously announced changes to its CSA program, including the adoption of a controversial proposal to step up hazardous materials compliance and the elimination of a perceived enforcement bias against flatbed carriers. According to FMCSA Administrator Anne Ferro during a conference call earlier this month, the agency implemented 11 changes to CSA, including the creation of a stand-alone hazardous materials compliance category and moving cargo-securement violations into the vehicle maintenance category. The changes include two Behavior Analysis and Safety Improvement categories FMCSA uses to monitor carrier performance; it also renamed another BASIC. The CSA program uses roadside violation inspection and crash data to help FMCSA identify unsafe or high-risk motor carriers.

When FMCSA first unveiled the tweaks in August, the agency said they would only cause "modest” changes to he program’s Safety Measurement System carrier percentile scores but would "sharpen our focus on the carriers that need our focus.” However, the new hazmat category has been controversial among motor carriers that are not primary hazmat haulers, as some have said a preview of the new BASIC showed their scores would worsen. Other modifications that went live last week include changing the name of the Fatigued Driving BASIC to the Hours-of-Service Compliance BASIC, removing 1-to-5 mph speeding violations from carrier and driver safety scores, and assigning the same CSA severity weights to paper logs and electronic logging device violations.

To help shippers (including those with private fleets) better understand the Compliance, Safety, and Accountability program, NASSTRAC will host a Collaborative Learning Lab on CSA at the upcoming 2013 Shippers Conference & Transportation Expo in April.

U.S. Trade Deficit Widens 5% In October

Tue, 27 Aug 2013 19:22:47 GMT

An Example of Advocacy: NASSTRAC Encourages Obama Administration To End Work Stoppage At Ports

Tue, 27 Aug 2013 19:24:08 GMT

NASSTRAC, along with other industry associations, signed on a letter last week to President Obama encouraging the administration to quickly engage in the situation to end the work stoppage at the ports of Los Angeles and Long Beach. NASSTRAC members had significantly concern about the situation’s negative impact on supply chain disruption.

> View Letter (PDF)

Shippers Provide Insights at Recent NASSTRAC Transportation Networking Meetings

Tue, 27 Aug 2013 19:30:09 GMT

In the last several weeks, NASSTRAC has hosted a number of regional meetings throughout the country – including Long Beach, Chicago, and Minneapolis. These events gave shippers an opportunity to network and to learn about current market concerns and emerging trends in transportation. Here are just a few observations made by shippers during these regional events:

In Long Beach, Alex Albertiniof Charlotte Russe, a specialty retailer of apparel and accessories, identified his three business supply chain focuses as cost containment, partnerships that will drive his company’s success, and growing intelligently by identifying the right markets. Mitch Bentzof Lewis Hyman said his biggest challenge is to achieve and execute consistently new and lean supply chain models, while continuously tweaking those models as customer requirements rapidly and dramatically change. Mike Dunnof Cambro Manufacturing, a manufacturer of hotel and foodservice products, explained his company is continuously working on true partnerships with carriers and educating them on Cambro’s business issues. Frank Quintof Restoration Hardware said he just opened the last of four DCs in his distribution network, and is focused on constantly aligning his carrier base and transportation resources with the retailer’s enterprise.

In Chicago, Michael Cole, Senior Director of Transportation for food company Kraft Foods, discussed the best practices, opportunities and challenges faced by his operations team that manages a networking supporting 700,000 shipments annually with budget responsibility of more than $1 billion spend. Joe Lombardo, Group Manager Transportation for Nestle, identified a major focus for his team to be on safety, and described collaborative efforts internally and externally with carriers for increased safety, efficiencies, and cost management. Carey Skoglund, National Logistics Manager for retailer Ace Hardware, outlined some of the transportation initiatives involving the logistics support to his company’s 4,000 domestic and international stores. Shipper panelists were particularly concerned about industry issues and advocacy issues that could increase transportation costs upwards of 15 - 17 percent.

In Minneapolis, Mike Tripp, Vice President of Supply Chain & Logistics with women’s apparel retailer Christopher & Banks, described how his organization streamlines its products through one DC and has focused this past year on inbound freight strategies, carrier score-carding, and adapting to rapidly changing customer expectations.Tom Wenzinger, Director of Corporate Traffic for retailer Advance Auto Parts, described how his company just opened its ninth DC, in Indiana, which is enabling them to provide daily deliveries of hot sellers to their stores nationwide. "We’ve found that our supply chain is not "one size fits all,” he said, "and we have been working on our supply chain model of the future that factors in frequency of orders and shipments, cost structure, visibility into shipments, and communications with our providers.”

>View Highlights of Long Beach Regional Meeting

>View Highlights of Chicago Regional Meeting

>View Highlights of Minneapolis Regional Meeting

Hurricane Sandy Disaster: How Can NASSTRAC Members Help?

Tue, 27 Aug 2013 19:38:08 GMT

NASSTRAC continues to work in partnership with the American Logistics Aid Network (ALAN) to help engage the transportation and supply chain community to help with response and clean-up on the East Coast, following this week's hurricane disaster. NASSTRAC members who are wanting to assist in the emergency response and clean-up from Hurricane Sandy should do the following: Review relief needs to make in-kind donations in response to specific requests or to make unsolicited donation offers and continually monitor ALAN's "Hurricane Sandy Advisories" that can be found at www.ALANaid.org or at www.ALANaid.org/sandy-advisories.php.

"NASSTRAC is able to leverage our relationship with ALAN to bring insight to our members on how they can engage in this national disaster," says Brian Everett, NASSTRAC's Executive Director. "Our shipper and provider members are quick to want to help – not only to be good corporate citizens, but for many, as companies that have operations and employees who have been dramatically impacted by this disaster."

NASSTRAC Files Concerns On FMCSA's Failure To Respond To Key Issues Raised On Hours Of Service

Tue, 27 Aug 2013 19:42:21 GMT

On Oct. 24, NASSTRAC filed concerns that FMCSA has failed to respond to most of the key issues raised by the American Trucking Associations' petition. The filing was made jointly with NASSTRAC as well as OOIDA, NIT League, Health & Personal Care Logistics Conference, and the Truckload Carriers Association. The substantive arguments FMCSA does offer are either impermissible post-hoc rationalizations or inconsistent with the record. Accordingly, FMCSA has not rebutted the joint petitioners' demonstration that the new restrictions imposed by the 2011 final rule are arbitrary.

The filing states that those restrictions will not yield net benefits and states that FMCSA's conclusion to the contrary rests on unjustified assumptions concerning the fatigue-caused crash rate; the relationship among work, sleep and health; and whether the same drivers work all of the longest weeks. The filing states that FMCSA has not proven that any of those assumptions bear a rational relationship to the data in the record.

> View Full Brief by NASSTRAC and Joint Petitioners (PDF)

Shippers Provide Insights at Recent NASSTRAC Transportation Networking Meetings

Tue, 27 Aug 2013 19:50:06 GMT

NASSTRAC has hosted a number of regional meetings throughout the country, giving shippers an opportunity to network and to learn about current market concerns and emerging trends in transportation. Here are just a few observations made by shippers during these regional events:

>View Highlights of Chicago Regional Meeting

>View Highlights of Minneapolis Regional Meeting

NASSTRAC, Other Industry Groups File Brief To Retain 11th Hour of Daily Driving Time

Tue, 27 Aug 2013 19:51:14 GMT

NASSTRAC, otherwise known as the National Shippers Strategic Transportation Council, joined a coalition of several other industry groups to file a brief Oct. 11 in the U.S. Court of Appeals for the D.C. Circuit, which is considering challenges to the latest truck driver hours of service rules issued by the Federal Motor Carrier Safety Administration (FMCSA). The brief supports FMCSA's decision to retain the 11th hour of daily driving time by drivers, based upon findings that the benefits of that decision outweigh costs. As an association representing shippers, NASSTRAC also supports the American Trucking Associations' goal of more flexibility as to restarts between workweeks.

According to John Cutler, NASSTRAC's legal counsel, the brief argues that Public Citizen and other safety advocates pushing to reduce driver hours do not have legal standing to make their arguments. NASSTRAC also has participated in an amicus brief emphasizing that over the past decade, the 11-hour maximum rule has been accompanied by steady improvements in safety, said Cutler. "This case, which will probably be decided in 2013, will significantly affect the trucking industry, shippers, consumers and the economy," he said.

Along with NASSTRAC, other industry groups joining the brief included the American Trucking Associations, Owner-Operator Independent Drivers Association, Truckload Carriers Association, National Industrial Transportation League, and Health & Personal Care Logistics Conference.

Are CSA BASICs Accurate In Predicting Crash Risk?

Tue, 27 Aug 2013 19:52:01 GMT

Motor carrier scores in two of the five public safety categories in the CSA program are "defective" in predicting crash risk, according to a new study by the American Transportation Research Institute. "There is no statistical support for making intended safety inferences based upon the Driver Fitness or Controlled Substances and Alcohol percentile rankings," according to the study. "In fact, carriers with higher scores in these two BASICs seem to present lower crash risks."

The new study of 471,000 fleets' safety measurement data also said that CSA carrier "alerts" from the FMCSA (Federal Moto Carrier Safety Administration) do not consistently identify the riskiest carriers. The study also concluded that in four of the five public BASICs, carriers with an "alert" had crash rates exceeding those of carriers in all other groups. "The one exception was Driver Fitness, where below-threshold carriers posed greater safety risks," the study said.

Diesel, Gas Prices Drop Again

Tue, 27 Aug 2013 19:53:17 GMT

Diesel and gas prices in the United States dipped again for the second consecutive week, the U.S. Department of Energy reported to NASSTRAC this last week. U.S. retail diesel prices dipped .7 cents per gallon to $4.079 on average, making the two-week decline a total of 5.6 cents per gallon from the recent peak of $4.135 on Sept. 17, according to the DOE. In 2011 at this time, diesel cost $3.749 on average. However, while prices declined nationwide, prices on the West Coast remain uncommonly high due to refinery problems, according to reports.

Looking at the national average, energy analysts say that diesel buyers likely will enjoy a short-term break from rising prices, but this may not last long due to a strong cold snap in the weather or developments in the economy that could change the speculative purchase of oil. Given the importance of energy prices to freight transportation, NASSTRAC continues to regularly monitor prices and provides graphical updates of diesel prices on a weekly basis.

> View Weekly Regional Diesel Prices

Registration Now Open: 2013 NASSTRAC Shippers Conference & Transportation Expo

Tue, 27 Aug 2013 19:57:05 GMT

Nowhere else will you find better education on transportation and supply chain trends and best practices than this event. It'll be packed with executive insights from both shippers and carriers, interactive discussion among transportation executives, and solid provider relations opportunities through an expanded transportation expo. It all takes place April 21-24, 2013 at the beautiful new Rosen Shingle Creek Resort in Orlando All NASSTRAC members receive a $300 discount off conference registration prices (and additional attendees from the same company pay only $495 to attend)!

>More information and to register

NASSTRAC Hosts Shipper Meetings Through October, November

Tue, 27 Aug 2013 19:58:27 GMT

NASSTRAC will host several Transportation Networking Meetings in various markets throughout the United States in October and November. The primary goal of these meetings is to provide a local venue where shippers have the opportunity to network with other freight transportation executives, hear perspectives on industry issues, and learn from best practices in transportation and supply chain management.

Each event will feature a networking luncheon, followed by a panel of shippers who will discuss opportunities, challenges and issues in freight transportation and supply chain management. "We've found that periodically hosting these local meetings is filling a void in the marketplace," says Brian Everett, NASSTRAC's executive director. "Transportation executives who have participated have said they find relevant education and networking, which is big part of NASSTRAC's mission."

The schedule of remaining regional meetings is as follows:

Oct. 18 at LifeWay Christian Resources headquarters in downtown Nashville, Tenn.
Oct. 25 at Hyatt Lodge at McDonald's campus in Chicago, Ill.
Oct. 30 at Target Corp. in Minneapolis, Minn.
Nov. 9, at the Renaissance Long Beach in Long Beach, Calif.

>More information and to register

Deadline Extended in East Coast and Gulf Coast Port Contract Talks

Tue, 27 Aug 2013 19:59:14 GMT

Management and labor negotiators in the East and Gulf Coast port contract talks have agreed to a 90-day extension of a contract that was set to expire on Sept. 30, giving both sides more time to "focus on the outstanding core issues in a deliberate manner." The announcement was made last Thursday from George Cohen, Director of the Federal Mediation and Conciliation Service, and came after both with FMCS as mediator. Coincidentally, the announcement was made at the same time shipper panelists at NASSTRAC's Regional Meeting in Memphis were discussing their concerns about the potential shutdown and many shipper expressed their relief at the extension.

Diesel Drops Nearly 5 Cents to $4.086; Gasoline Declines to $3.826

Tue, 27 Aug 2013 20:00:01 GMT

Diesel prices dropped 4.9 cents to $4.086 and gasoline also declined, marking the first downturns for both fuels in 12 weeks, the Department of Energy reported to NASSTRAC yesterday. Gasoline prices decreased 5.2 cents to $3.826 a gallon, DOE said Monday following its weekly surveys of filling stations. Despite the downturns, diesel prices are now 30 cents higher than the same week last year, while gasoline is 31.7 cents more expensive than a year ago. The diesel decrease was the biggest since June 25, when it fell 5.1 cents. Gasoline fell 8.1 cents in its last decline, on July 2. Diesel had risen 48.7 cents in the previous 11 weeks of increases, while gasoline rose 52.2 cents, according to the DOE.

NASSTRAC and Other Industry Groups Sue To Block Implementation of HOS Rules

Tue, 27 Aug 2013 20:00:39 GMT

NASSTRAC is part of a coalition of 15 industry groups that filed suit in federal appeals court in Washington, D.C., last month to block the Obama Administration's attempt to change regulations governing commercial truck driver operations. The group contends that moving forward with this rule will only create more uncertainties in an already cumbersome regulatory environment. The 15 industry groups, which represent most sectors of the U.S. economy, said the Hours of Service (HOS) Rules were crafted without considering the costs they would impose on the supply chain. Industry groups have long argued that major changes in driver work rules would disrupt supply chains that have been calibrated to work with the regulations now in effect. They also maintain the trucking industry is operating as safely today as it has since records were being kept, and there is no need to impose additional regulations that will drive up costs without having an appreciable benefit on highway safety.

For more information, visit www.FreightAdvocacy.org.

Shippers Tour FedEx Memphis World Hub, Meet To Discuss Challenges and Opportunities

Tue, 27 Aug 2013 20:03:02 GMT

More than 2 million packages pass through the FedEx Memphis World Hub daily. On Sept. 20, NASSTRAC hosted a special tour of the facility that gave shippers a glimpse into the incredible processes, engineering, and teamwork that make it all happen. Following the tour, NASSTRAC held a networking luncheon for all attendees and then featured a shipper's panel that gave primary insights into transportation and supply chain goals, challenges and opportunities.

Sherry Askew, Transportation Manager at Revlon, spoke of how Revlon's Chief Supply Chain Officer challenged her group to save a million dollars in expenses, and shared some of their best practices in developing a partnership with a major 3PL to "live load" and become a larger user of rail to reduce transportation costs. David Friedson, Director of Logistics & Distribution for Evergreen Packaging, emphasized how critical it is to have solid relationships with service providers and helped to define what this truly means. Mike Ritter, Sr. VP Operations for Hunter Fan Company, highlighted best practices within this ceiling fan manufacturer's entire supply chain.

>Highlights of Memphis Meeting

NASSTRAC Hosts Shipper Meetings Through October, November

Tue, 27 Aug 2013 20:06:22 GMT

The schedule of remaining regional meetings is as follows:

Oct. 18 at LifeWay Christian Resources headquarters in downtown Nashville, Tenn.
Oct. 25 at Hyatt Lodge at McDonald's campus in Chicago, Ill.
Oct. 30 at Target Corp. in Minneapolis, Minn.
Nov. 9, at the Renaissance Long Beach in Long Beach, Calif.

> More information and to register

NASSTRAC Website Offers Members More Value

Tue, 27 Aug 2013 20:11:05 GMT

Being part of the transportation community is a big reason why many belong to NASSTRAC. But while numerous benefits are derived from face-to-face interaction, they're now enhanced through NASSTRAC's new website. Check it out: www.NASSTRAC.org

"The new site is easier to navigate," says Brian Everett, Executive Director. "It has more valuable information, including a new blog (www.FreightTalk.org) which encourages dialogue and sharing perspectives and ideas among members. And it speaks more powerfully to shippers and to the value we have to offer." Additional features include:

A comprehensive site map on the home page to quickly search content.
Logical layout with emphasis on NASSTRAC's three key areas of value: Education, Advocacy, and Provider Relations
A more robust Jobs section through a strategic partnership with JobsInLogistics. com (soon to be launched)
Valuable resources in the Members Only section, including a searchable member directory (by name, company, geography, and market segment), archives of NewsLink, previous event presentations, and contract templates.

NASSTRAC and Other Industry Groups Sue To Block Implementation of HOS Rules

Tue, 27 Aug 2013 20:12:19 GMT

NASSTRAC is part of a coalition of 15 industry groups that filed suit in federal appeals court in Washington, D.C., earlier this month to block the Obama Administration's attempt to change regulations governing commercial truck driver operations. The group contends that moving forward with this rule will only create more uncertainties in an already cumbersome regulatory environment.

The 15 industry groups, which represent most sectors of the U.S. economy, said the Hours of Service (HOS) Rules were crafted without considering the costs they would impose on the supply chain. Industry groups have long argued that major changes in driver work rules would disrupt supply chains that have been calibrated to work with the regulations now in effect. They also maintain the trucking industry is operating as safely today as it has since records were being kept, and there is no need to impose additional regulations that will drive up costs without having an appreciable benefit on highway safety.

For more information, visitwww.FreightAdvocacy.org.

NASSTRAC Announces Regional Meeting Schedule for Shipper Education, Networking

Tue, 27 Aug 2013 20:14:44 GMT

NASSTRAC announces its schedule of regional meetings that will take place in various markets throughout the United States this fall. The primary goal of these meetings is to provide a local venue where shippers have the opportunity to network with other freight transportation executives, hear perspectives on industry issues, and learn from best practices in transportation and supply chain management.

The schedule of regional meetings will take place on the following dates at these locations:

Sept. 20 at the FedEx Memphis World Hub in Memphis, Tenn.
(includes a tour of the facility). Sponsored by FedEx.
Oct. 18 at LifeWay Christian Resources headquarters in downtown Nashville, Tenn.
Oct. 25 at Hyatt Lodge at McDonald's campus in Chicago, Ill.
Oct. 30 at Target Corp. in Minneapolis, Minn.
Nov. 9, at the Renaissance Long Beach in Long Beach, Calif.
Sponsored by Special Dispatch of California.

>More information and to register

NASSTRAC and Other Industry Groups Sue To Block Implementation of HOS Rules

Tue, 27 Aug 2013 20:15:58 GMT

NASSTRAC is part of a coalition of 15 industry groups that filed suit in federal appeals court in Washington, D.C., yesterday to block the Obama Administration's attempt to change regulations governing commercial truck driver operations. Along with NASSTRAC, the coalition includes the U.S. Chamber of Commerce, the Retail Industry Leaders Association, and the National Retail Federation.

"For industries and carriers charged with delivering fresh food, keeping assembly lines running, and making deliveries, this rule is concerning and will hurt the economy," said Rick Schweitzer, counsel for the coalition. "With the lack of evidence that it will improve safety, moving forward with this rule will only create more uncertainties in an already cumbersome regulatory environment."

They also maintain the trucking industry is operating as safely today as it has since records were being kept, and there is no need to impose additional regulations that will drive up costs without having an appreciable benefit on highway safety.

Tuesday's action comes one week after the American Trucking Associations (ATA) also took legal action to oppose the controversial measure.

Battling Controversial Changes

Tue, 27 Aug 2013 20:17:07 GMT

The Final HOS Rule, issued last December by the Federal Motor Carrier Safety Administration (FMCSA), is scheduled to take effect next July. However, the Rule was expected all along to face major legal challenges that could delay implementation well beyond next year and might result in the regulations' being changed or even scrapped.

Jonathan Gold, Vice President, Supply Chain and Customs Policy for the National Retail Federation, said the group's intent is to have the December policy directive thrown out and to keep the rules currently in effect.

The Final Rule maintains an 11-hour limit on the amount of continuous time a driver can be behind the wheel. The FMCSA had toyed with the idea of reducing the limit on continuous driving hours to 10, a move that provoked an outcry from shippers and truckers who warned that the change would disrupt carefully crafted supply chains built around 11-hour continuous drive times.

The rule limits a driver's workweek to 70 hours within a seven-day period, down from 82 hours. In addition, drivers cannot drive after working eight hours until they take at least a 30-minute break.

But by far the rule's most controversial provision requires drivers working the maximum number of weekly hours to take at least two rest periods—between 1 a.m. and 5 a.m.—during a 34-hour "restart" period. Under this provision, drivers may restart the clock on their workweeks by taking at least 34 consecutive hours off-duty. The Final Rule allows drivers to use the restart provision only once during a seven-day period.

Industry groups say the language would increase wait times for drivers to return to work and would put more trucks on the road with passenger cars during morning rush hours, causing severe traffic congestion and putting lives unnecessarily at risk. The groups said there is no scientific evidence that the change in the so-called restart provision will improve highway safety.

Note: Article by Mark Solomon, DC Velocity magazine

Candace Holowicki Named New NASSTRAC Education Chairwoman

Tue, 27 Aug 2013 20:22:11 GMT

NASSTRAC recently named Candace Holowicki as Chairwoman of its Education Committee. NASSTRAC provides education, advocacy, and provider relations for professionals involved in all modes of transportation. Holowicki's primary responsibilities will include leading the planning and execution of the NASSTRAC Shippers Conference & Transportation Expo, which will take place April 21-24, 2013, in Orlando. Holowicki has served on NASSTRAC's education committee since 2009, and also currently serves on its executive committee.

Holowicki, who has nearly 20 years experience in the transportation industry, currently is Director of Global Logistics at TriMas Corp., a manufacturer and distributor near Detroit, Mich. She previously was Manager of Logistics with Masco Corp., a major manufacturer of new construction and home improvement products. Holowicki holds a Master of Science degree in global supply chain management from Indiana University – Kelley School of Business; and a Bachelor of Arts degree from the University of Michigan. She succeeds in this position Chris Norek, Ph.D., senior partner of Chain Connectors, who recently assumed the officer position of 1st vice president of NASSTRAC.

"NASSTRAC has built a solid reputation for its quality education and unique learning and networking environment at our annual conference," says Doug Easley, NASSTRAC President. "We look forward to Candace's leadership in continuing this long-standing tradition."

Diesel Prices Rise 1.3 Cents to $3.796 in Fourth Straight Weekly Increase

Tue, 27 Aug 2013 20:23:53 GMT

Diesel rose for a fourth straight week, rising 1.3 cents to $3.796 a gallon, the Department of Energy reported to NASSTRAC on Monday. Gasoline also rose for the fourth week, increasing 1.4 cents to $3.508, DOE said, following its weekly survey of filling stations. With the increase, diesel is now 14.1 cents below the same week last year, while gas is 20.3 cents under a year ago, according to DOE records. Trucking's main fuel has risen 14.8 cents in the past month, after falling 50 cents in 12 straight previous declines. Gasoline has risen 15.2 cents in the past month, following a 58.5-cent drop in 13 previous consecutive downturns. Oil fell for the first time in five trading days Monday, declining 35 cents to settle at $89.78 a barrel, Bloomberg reported.

Shippers Continue Concern Over Potential Port Service Disruption If Labor Negotiations Fail

Tue, 27 Aug 2013 20:24:40 GMT

Shippers continue their concerns over potential port service disruption, as the International Longshoremen's Association and United States Maritime Alliance continue their negotiations for a contract agreement before the Sept. 30 deadline. For shippers with global supply chains, ports play a critical role in freight movement and a potential disruption would be destructive to shippers' ability to deliver goods and materials through those supply chains. While a work stoppage would be the most harmful result, negotiators are mindful that if the parties fail to reach an agreement in advance of the Sept. 30 deadline, shippers would be forced to redirect shipments to the West Coast to avoid an interruption in their supply chains. The ongoing labor negotiations will impact 14 East and Gulf Coast ports, which together account for 95 percent of all containerized shipments to the Eastern Seaboard.

The ILA and USMX met for two days of negotiations in late June and reported "substantial progress" in their talks. They are scheduled to meet again tomorrow, July 18, in Delray Beach, Fla. "This potential disruption would be devastating to supply chains and NASSTRAC shippers are extremely concerned over the potential ramifications of service disruption at these ports," says Brian Everett, NASSTRAC's Executive Director. "I'm hearing some say they are planning for the worst and hoping for the best." In fact, he's heard some shippers are already beginning to redirect their supply chains in order to allow adequate lead time to ensure that customer needs can continue to be met, regardless of whether the negotiations are successfully concluded by Sept. 30.

NASSTRAC Sees Highway Bill As Positive For Shippers Reliant on Truck Transportation

Tue, 27 Aug 2013 20:25:27 GMT

NASSTRAC earlier this month commended members of the House and Senate conference committee for their work in passing a highway bill that lays a foundation addressing America's need for adequate freight transportation infrastructure. NASSTRAC has been a vocal supporter of a long-term highway plan and appropriate funding, and had been urging Congress to enact a bill that funds badly needed infrastructure construction and maintenance at no less than MAP-21 levels. Along with various filings and formal letters to House and Senate conference committees, NASSTRAC had led two fly-ins to Washington that resulted in dozens of meetings between shippers and members of Congress, with infrastructure being a topic of primary concern.

"NASSTRAC has placed a significant emphasis on the topic of infrastructure over the past few years," says Mike Regan, chairman of NASSTRAC's advocacy committee. "While this highway bill does not include everything we wanted, it lays a foundation for future improvements to our nation's freight transportation infrastructure. On behalf of NASSTRAC, I thank Chairmen Mica and Boxer, and all the conferees for putting partisanship aside and developing a compromise bill that will benefit shippers, the trucking industry, our economy, and our country overall. We now urge President Obama to quickly sign this critical legislation."

Regan pointed out that one area where the bill falls short is in the area of truck productivity. NASSTRAC had urged the conference committee to incorporate provisions that would improve motor carrier productivity, including enabling states to allow longer and heavier trailers, consistent with safety and highway wear and tear in order to accommodate increased demand without needlessly increasing the number of trucks on roadways. "While there are many positive aspects to this new highway bill, NASSTRAC is disappointed that instead of addressing this in the legislation, there is a provision which calls for a two-year study on the heavier truck issue," says Regan. "Substantively speaking, this legislation does not address truck productivity, which is important to shippers relying on over-the-road freight transportation. By giving into fear-based misinformation, this bill unfortunately delays the deployment of some of the trucking industry's safest, most fuel-efficient trucks. Past studies have shown time and again that modest increases in truck size and weight limits have a net positive effect on highway safety and maintenance."

Diesel, Gas Prices Increase for First Time in Three Months

Tue, 27 Aug 2013 20:29:29 GMT

The average U.S. price of a gallon of diesel fuel rose 3.5 cents a gallon last week to $3.683, the first increase in three months, the U.S. Department of Energy reported to NASSTRAC earlier this week. Shippers continually watch the volatility of prices as it can have a significant impact on overall supply chain costs.

Diesel had declined 50 cents a gallon since April 9 before the increase, DOE said after its July 9 survey of fueling stations. DOE also said the average retail gasoline price jumped 5.5 cents to $3.411 a gallon, the first increase in that average in 13 weeks. Gasoline had fallen 53 cents since April 2 before the jump. Following last week's increases, diesel now costs 21.6 cents a gallon less than it did a year ago and gasoline is 23 cents cheaper than the corresponding week in 2011.

Consumer Price Index Unchanged

Tue, 27 Aug 2013 20:30:12 GMT

The consumer price index was unchanged in June following a 0.3% drop in May, the Labor Department said Tuesday. The May 0.3% drop had been the biggest decline in three years. The government's main inflation gauge matched economists' projections, Bloomberg reported. The core CPI rate excluding food and energy rose 0.2% for a fourth straight month. Almost 60% of the CPI covers prices consumers pay for services. If consumer prices are climbing, it could reflect an increase in demand for consumer goods, which increases the demand for trucking services.

NASSTRAC Urges Conference Committee Leaders To Enact New Highway Bill

Tue, 27 Aug 2013 20:32:19 GMT

NASSTRAC sent a letter yesterday to all Highway Bill Conference Committee members encouraging them to promptly enact a bill that will fund badly needed infrastructure construction and maintenance. Without efficient trucking service that can accommodate projected future demand for high quality freight transportation, shippers will be forced to devote increasing capital expenditures to inventories and warehousing for safety stock, said the letter. The result will be less money to spend on investments, growth and jobs, and higher prices for consumers, as supply chain efficiency declines.

"Maintaining a strong and growing trucking industry is impossible if we continue to underfund our highway infrastructure," says John Cutler, NASSTRAC's Legal Counsel. "While Map-21 will not provide all the highway funding needed, it's far better than inaction and will avoid further disruption of existing highway projects." NASSTRAC joins several other industry associations in calling for highway funding based on no less than MAP-21 levels.

NASSTRAC also urged the conference committee to incorporate beneficial provisions from H.R. 7, the American Energy and Infrastructure Jobs Act of 2012, with particular support of provisions that will improve motor carrier productivity. NASSTRAC supports provisions that would permit states to allow longer and heavier trailers, consistent with safety and highway wear and tear in order to accommodate increased demand without needlessly increasing the number of trucks on roadways. "The resulting productivity gains are needed to offset governmental measures reducing productivity, such as changes in driver hours of service rules," says Cutler. In addition, NASSTRAC supports streamlined procedures for permitting highway work, including building new highways and expanding old ones, and has gone on record to suggest that funding through higher tolls should be avoided.

> View NASSTRAC's letter to Highway Bill Conference Committee

Analysts Report Capacity At Equilibrium

Tue, 27 Aug 2013 20:33:26 GMT

Analysts at the NASSTRAC Shippers Conference & Transportation Expo last month reported demand and supply are at equilibrium. With the economy growing moderately at 2% this status should remain unchanged for now.

"There is a structural element for capacity being tight. The fleet age is at a generational high. The size of fleet is shrinking one to 2% over the course of next two years," said Benjamin Hartford of Robert W. Baird & Co. This has implications to all freight since truckload represents 70 percent of total domestic freight spend.

According to Derek Leathers, President and COO, Werner Enterprises' 19% - 20% of the truckload capacity that existed in 2007 has left the market. Companies that are merging or acquiring others are openly saying they are going to sell equipment because it's too old. Trucks are leaving the market. On the other side, demand is down 17% bringing the supply and demand of the market to equilibrium. Now as economy shows signs of life, capacity is getting tight.

Yet, there are no signs of capacity coming online any time soon. Equipment costs have increased 35% to 40% and access to capital is difficult. It is estimated that 200,000 to 220,000 trucks are needed annually to keep the U.S. trucking fleet constant. Combining that with the average age of today's fleet at 7 years only increases the number of units needed.

John Barnes of RBC Capital Markets made these highlighted observations per each mode:

Truckload: Volumes are stable. Capacity is tight. Supply and demand at equilibrium. Carriers are not adding capacity. The driver shortage is worsening. If the GDP grows faster than its modest 2% capacity will be further constricted.
LTL: There is ample capacity. Public fleets could handle 10% - 20% more today.
Intermodal: Abundant capacity. Expect continued market share gain from truckload.
Air: Ample capacity. Demand sluggish. Tonnage down 1.5% year-over-year.
Ocean: Too much capacity.

All Signs Point to Rate Increases

Tue, 27 Aug 2013 20:35:01 GMT

The message of continuing price increases was echoed in presentations at the recent NASSTRAC Shippers Conference & Transportation Expo. The stated amount of the increase varied falling in a range of 2% - 7%.

"There is a cost pressure and a wave of costs coming to the truckload industry that are unlike any that we have ever seen," said Derek Leathers, COO Werner Enterprises. Presenters throughout the conference recounted facts on increasing costs in all areas especially drivers, fuel, equipment, and tires.

Benjamin Hartford of Robert W. Baird & Co. reported a 2% - 4% truckload price increase in 2012. His considerations to this statistic included fleet age being at a generational high and fleet size shrinking at 1% - 2% over the next two years setting the stage for positive pricing. Hartford reports other mode prices increasing in 2012 (LTL 2% - 5% and rail 3% - 4%).

John Barnes of RBC Capital Markets sees GDP growing moderately at 2%. If there is a more material recovery, capacity will be tighter driving the need for more than an RBC's forecasted 2% rate increase.

"At U.S. Xpress, we challenge ourselves to become more efficient and more effective," said John White, President, U.S. Xpress. "Yet we need 5% to 7% in rates," he added.

Last year, third quarter reports from the 11 publicly-traded carriers showed an average price increase of 4.1%. Eight of the 11 had financial results worse in third quarter 2011 than in the same 2010 quarter signifying the rate increase wasn't enough for them to make an appropriate return on their investments.

There are efficiencies being made. "In the last year and a half we have dropped idle by about 40%. On top of that, we dropped our dead head by 15%. Yet on a 500-mile move, because of fuel costs, my cost to move that load is up about $5 a load," said White.

The need to attract drivers is a key factor in rising prices. The lack of drivers translates to equipment sitting idle reducing productivity and utilization rates. Conference speakers agree that driver pay needs to increase. Driver income is not keeping up with inflation. Also, with the CSA requirements, it is becoming more difficult to find qualified drivers. Both shippers and carriers can improve the driver environment. Pay is only one aspect. Getting drivers loaded and unloaded efficiently goes a long way to keeping drivers on the road increasing their income potential.

Other strategies that can impact freight costs include:

Moving freight on weekends improves truck utilization. Drivers on irregular routes work on weekends. At U.S. Xpress 70% of trucks on weekends are looking for freight.
Selecting the most efficient mode. Moving an LTL to truckload or truckload to intermodal carries reduced pricing.
Transportation/fleet outsourcing to a credible carrier can provide cost savings since leasing is still the lower cost.
Using a holistic approach to the supply chain. Analyze the total cost to serve over a period of time rather than truckload rates alone.