Tucker Blog

Sunday, October 14, 2007

Rough Road Ahead - Philadelphia Inquirer

Rough Road Ahead
By Henry J. Holcomb
Inquirer Staff Writer

When freight manager Jeffrey Tucker heard the state planned to turn Interstate 80 into a toll road, he wondered, "What next?"
More change is battering the trucking industry than at any other time in the 46-year history of the Tucker Co., a Cherry Hill logistics firm founded by his grandfather.

The proposals - including adding tolls to I-80 and turning the Pennsylvania Turnpike over to private operators - would dramatically alter the two main cross-state routes, truckers and transportation executives say. Meanwhile, the industry faces troubles on several fronts:

Another change in the hours drivers can legally work, arising from efforts to reduce the 5,000 fatalities a year from truck-related accidents, is being battled out in the courts, and the outcome could force higher costs and complex changes.

Trucking companies wrestle with driver turnover rates of more than 100 percent per year and wonder if they will be able to meet the cargo-growth demands in coming decades.

Tightening environmental rules are reducing fuel efficiency and boosting maintenance and new-truck costs.

The nation's highways and bridges are, as one trucking company chief executive officer put it, "in scary, scary shape." They are wearing out and ill-equipped to handle the anticipated doubling of cargo shipments over the next 20 years. The bridge collapse in Minneapolis has intensified concerns about aging roads and bridges. Businesses ponder the impact on their operations if a collapse happened here.

All this is causing complex ripples of problems, renegotiated contracts and schedules.

The time it takes to get fresh produce and fruit to Philadelphia from the West Coast could soon stretch from five days to more than seven, said James P. Storey Jr., president of Quaker City Produce Co.

Pointing to the harvest date on a box early one Sunday, he said that extra time was enough for a market price change that would cost him a bundle.

The impact could extend to rural towns and school districts, where truck stops and other businesses clustered around exits are often the largest taxpayers. When tolls are added to a highway, business at exits is cut in half, according to a University of Maryland study sponsored by the truck-stop operators' trade group, NATSO Inc.

Transportation is still a relatively small part of the cost of what the public buys - about 1 percent to 5 percent for 70 percent of goods shipped, said John E. "Gene" Tyworth, chairman of the Pennsylvania State University's supply chain and information systems department.

Some companies benefit from the toll talk and rising fuel costs. ALK Technologies Inc., of Princeton, has doubled sales of its truck-navigation software. With a partner, Integrated Decision Support Corp., ALK's PC Miler software now provides drivers with up-to-the-minute diesel-fuel prices, gleaned from electronic credit card transactions. It tells drivers how much to buy at each stop to reduce the trip cost.

"This adds up to big money. These guys fill up for 700 bucks or more," said Ed Siciliano, ALK's sales and marketing vice president.

Fuel-cost-per-mile data can be added to another ALK program that tells drivers whether driving extra miles to avoid paying tolls saves money.

Proposals to convert interstates into toll roads in 30 states, including Pennsylvania, are, truckers and shippers say, a money grab to fix state budgetary problems. They express similar views on a Bush administration push to get states to sell turnpikes to private groups.

"This is a dangerous, dangerous trend. The nation's infrastructure is in very, very scary shape for the long term," said Steve O'Kane, chief executive of A. Duie Pyle Inc., a West Chester-based trucking company.

The nation needs to rebuild and expand its road system, not use the roads to generate money for other expenses, he and others argue.

The need far exceeds revenue from traditional sources, so new tolls and alternatives such as turning roads over to private operators must be considered, Gov. Rendell argues. His office said last week that Pennsylvania needed an additional $1 billion annually for its roads and bridges even though spending rose from $1.78 billion in 2004 to $2.37 billion last year.

This infrastructure gap is growing nationwide. A study by Deloitte Research, a member firm of Deloitte Touche Tohmatsu, of New York, estimates that "driving on roads in need of repair costs U.S. motorists $54 billion every year in extra vehicle repairs and operating costs. This works out to an average of $275 per motorist each year."

This cost does not include economic losses from workers stuck in traffic.

Making I-80 a toll road "would have a significant impact," said Mike Skousen, a senior executive with Salt Lake City-based C.R. England Inc., a long-haul truck line with major operations in South Jersey. "Normally we have to eat the toll."

Others say pressing too hard to pass toll costs on to a customer would just drive the business to hungrier companies that, they say, often have lower standards for equipment and driver training.

The Owner-Operators Independent Drivers Association says each truck already pays $16,000 a year in federal and state road-use taxes.

By all accounts, the men and women who drive trucks are feeling the most pain from the changing situations.

"The way I heard one driver put it, 'Everybody's trying to get a piece of me,' " said Skousen, whose company employs 4,600 drivers to operate its 3,200 trucks and 5,400 trailers. It operates four driver-training schools to cope with an annual turnover rate of 120 percent.

Local drivers are often paid by the hour, but those on long hauls get a fee per mile, based on the shortest route between points. Detours, delays at loading docks and time stuck in traffic jams cut daily earnings.

"There's no way a trucker can keep a legal log book and make any money," said a veteran trucker waiting for his truck to be unloaded at a South Philadelphia dock, who, fearing future scrutiny, asked that his name be withheld.

So he and others say they must find ways to work around rules to keep truck payments and deliveries on schedule. Sometimes there is no safe place to stop. Other times, pressing on is safer than stopping and getting caught in dangerous weather.

This creativity is producing pressure, from Congress and safety advocacy groups, for electronic monitoring of how much time drivers spend behind the wheel.

Drivers feel the pressure to keep moving and get frustrated when hung up at loading docks, said Tom Stefanopoulos, owner of Norm & Lou's Restaurant, popular with truck drivers bringing shipments to the Philadelphia Regional Produce Market in South Philadelphia. "I've seen guys come in here early on a Sunday and not get unloaded until Monday."

Joe Hobbs, 62, of Chillicothe, Mo., agrees. "These guys here are pretty good," he said, watching his load of Idaho potatoes being unloaded at Quaker City Produce, in the produce terminal.

They started unloading his truck soon after he arrived and were hustling. "But I've sat at some docks eight to 10 hours. If they'd let us count that time as off-duty, that would be OK," Hobbs said. "I could take a nap in my sleeper." He finds such naps restful, he insists, despite the rumble of forklifts loading or unloading his trailer. "When I feel them quiet down, I wake up," he said.

Anette Sandberg, a former administrator of the Federal Motor Carrier Safety Administration and a former chief of the Washington State Patrol, is sympathetic with drivers who feel rested after naps.

"But a lot of scientific studies say if you break sleep into small chunks, you won't get enough restful sleep to focus on tasks. Drivers say trust me, that's how I feel. But that's not data. If they make rule based on how people feel, they'd be back in court," she said, citing lawsuits from Public Citizen, a Washington-based safety activist group.

Ideas on how to make trucks and the cars around them safer abound.

Training comes up often in conversations with industry experts and drivers. "Some companies will give a guy six weeks of training and call him a truck driver," Hobbs said. "I see young drivers fly by in ice and snow, then down the road, there they are, jackknifed and blocking traffic."

The solution is to pay drivers by the hour instead of by the mile, said Todd Spencer, a former truck driver who is executive vice president of the Owner-Operators Independent Drivers Association.

"Truck drivers have to work around everybody else's schedule. Shippers and receivers have no financial incentive to avoid wasting drivers' time," Spencer said.

With all the hassles, Hobbs still loves life on the road. In part that is because he has kept a clean driving record for 27 years and built up enough experience to get on with a top company, Great Plains Transport Inc., of West Fargo, N.D. Every three years, the company buys him a new truck, with a comfortable sleeper cab, and his wife travels with him from time to time.

But he worries about the future. Many truck stops have become places where drivers get knocked in the head and robbed, and there is less camaraderie on docks and rest stops than there once was, he said. Drivers now frequently come from Eastern Europe and Asia and speak little English. "I tried to talk to that man over there. He couldn't understand a word I was saying," Hobbs said.

Tucker, the Cherry Hill logistics firm owner, and others see worrisome trends getting too little attention. "Eventually we who buy things will pay for the inefficiency with higher prices," Tucker said.

State budget problems and other conflicts take the public's eye off the road ahead, Tucker said. "It is," he added, "almost like we're going to have to get to having nothing on shelves to get people to pay attention and prepare for the future."