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Are you a highway user who wants to travel on safe, less congested roads?
Join Andrew Stasiowski, President and CEO of the American Highway Users Alliance, as he speaks with leading experts about the latest policies impacting the transportation community. Each month, Andrew will cover topics of critical importance to the highway user community, from reducing congestion on roads, to reforming highway trust funds, to increasing global competitiveness.
Listen to new episodes of “Driving Forward” wherever you get your podcasts.
The American Highway Users Alliance is a nonprofit organization advocating for public policies that promote roadway safety, increase freedom of movement, and preserve opportunities for all people to live, work, shop, and travel unencumbered.
To learn more about AHUA, you can visit our website.
Andrew Stasiowski (00:06):
Hello, and welcome to the Driving Forward Podcast. I am your host, Andrew Stasiowski, of the American Highway Users Alliance.
(00:18):
Today we have a great interview for you about the trucking industry. Before we get to the interview, I wanted to change things up a bit by offering our three key points from today's interview. First, the trucking industry is huge. 72% of all freight is moved by truck. Second, environmental regulations coming out of the state of California and the Environmental Protection Agency are threatening the ability of the trucking industry to operate efficiently. The industry will need more time to comply with these rules and the infrastructure in place to operate efficiently in this new environment.
(00:55):
Third, the need for truck parking is massive. Additional parking is needed to both recruit drivers and allow drivers to find a safe place to rest. The Highway Users will continue to work with the trucking industry to support policies which provide for more truck parking. And now, onto our interview.
(01:16):
Today, we're going to dive into the industry that keeps our economy going every day. I'm of course talking about trucking. Joining us is Chris Spear. Chris is the President and CEO of the American Trucking Associations. ATA is the largest and most comprehensive trade association representing the trucking industry, and Chris has been their leader since 2016. Chris, welcome to the Driving Forward Podcast.
Chris Spear (01:38):
Thanks for having, Andrew.
Andrew Stasiowski (01:39):
Appreciate you coming on today. I know this is a big get for us, so thank you.
(01:44):
I think we like to start our podcasts with just a general overview of the industry we're discussing today, and obviously trucking, I think everyone sees trucks on the roads, they interact with them all the time. I don't think people fully grasp how big the trucking industry is. Could you just talk about how much of the percentage of freight is moved by trucks and just the overall economic impact of trucks?
Chris Spear (02:08):
Yeah. Today, Andrew, we're moving 72.5% of the domestic freight in the US and roughly 76% of the trade between Mexico and Canada. So we are now rail's largest customer. Repositioning and the coordination of intermodal elements within the supply chain, it become an integral part of trucking. If we're not moving it, we're generally last mile, so it will touch a truck at some point if it's not solely moved by our industry.
(02:36):
There are parts and pieces where we still play a vital role. So supply chain efficiencies are obviously very, very important and we hear a lot more talk about that nowadays, especially during COVID, post-COVID, and with the new Infrastructure Bill. So 72.5%, it's a big number. To grow it even more, you're going to have to have a lot of investment into our infrastructure, but we're very proud of what we've become today and it's a very proud industry. We're literally over eight million strong in trucking, 3.8 million drivers, and we're one in 18 jobs in the United States. We're the top job in 29 states, Andrew, is trucking related.
(03:16):
So there really isn't anything that isn't impacted by our industry, and not just the milk, eggs, bread, and fuel, but even during COVID, the test kits, the PEP, and the vaccine itself. We are very involved in literally every element of the economy, and so when we have disruptions, obviously it's felt by consumers, including you and me.
(03:39):
So putting a spotlight on, that's what ATA does. We're in our 91st year, I'm the ninth person to lead it during that span. We've seen a lot since 1933, the evolution of not just the ATA, but the industry within it. And the country has changed and grown and we've had to adapt and grow with it. It's a great story. It's one that we're very proud of, as I said, and really appreciate to have opportunity to come on and give some color to it.
Andrew Stasiowski (04:09):
I appreciate that. That's really helpful for everyone to understand just how big ... I think I get a delivery truck come by my house just about every single day, delivering a package, delivering a what-could-be. I think the logistical efficiency of the trucking industry is really something to withhold.
(04:27):
I think, given that, what would you say today are some of the biggest threats facing the industry? What are the things that you think are you guys just focused on?
Chris Spear (04:39):
Yeah, I think outward facing, most consumers now have a general understanding of the industry during COVID, post-COVID. So you mentioned a delivery truck to your house. COVID certainly brought just-in-time, E-commerce, really to the forefront of America's awareness.
(04:56):
Consumers now understand, to get something that quickly, sometimes the same day delivered to your doorstep, there's a lot of movement that goes with that and there's a lot of people behind that happening. And so I think they understand our industry and the vital role that we all play. It's not just a truck or a step van, it's a person behind the wheel. They're often a mom, they're a dad, they're a husband, wife. They play parts in every community in the country.
(05:23):
Clearly the last five years have really brought to life the public's awareness. What they aren't seeing however, is the future, then the threats that they could pose if we go too fast, if we have timelines and targets that are simply unachievable. And what I'm referring to there is this mad dash to zero, zero emissions. And I would say that is without question, over the next 10 to 12 years, the biggest threat to our industry.
(05:55):
And people out there, consumers, really need to understand what it means. It is not an anti-environment agenda. We have a tremendous pedigree when it comes to reducing emissions. We all want clean air, we all want clean water. 40 years of working with the EPA on phases 1, 2, and now 3 greenhouse gas emissions, we have removed during that span 98.5% of everything that comes out of the tailpipe. So today, one truck, one brand new truck, emits what 60 trucks emitted in 1988. That is a remarkable story, and it's one we're very proud of and we tell hand and glove with our regulators, like EPA.
(06:41):
So it's innovation. It's working with very, very smart engineers at OEMs that know how to do this. And it's also, Andrew, more importantly, having achievable timelines and targets. If we go too fast, you're going to have a lot of repercussions, and that is exactly what we're seeing now. This administration, this White House is usurping the EPAs authority and partnering with industries like ours. And by the way, we like working with EPA because it's one standard, not 50, across state lines, like airlines, like ships, rail. We're all very much an interstate, commerce-driven industry.
(07:20):
So one standard is good for us, and what this White House has done is granted waivers, not unprecedented, but granted these waivers to CARB, California Air Resources Board in Sacramento. This is an unelected board, that has basically carved us out and decided that starting January one of this year, Advanced Clean Truck rule is in effect, which means our OEMs now have to manufacture a certain percentage each year of non-tailpipe emission, non-emitting equipment like electric trucks. And they have to remove diesel from their off-ramp. So displacing that with a percentage year-over-year of these BEV commercial vehicles.
(08:02):
Come 2030 is the Advanced Clean Fleet rule takes effect. That is the motor carriers that now have to buy that equipment from the OEMs. And so we're talking one to six years that year-over-year you're going to now have to adopt ... And it's not just California, we have 11 adopting CARB states. Beyond that, several others that will probably follow suit.
(08:26):
So half the states in the country are now going to follow CARB's lead. This truly has become, with these waivers, the United States of California, and this White House is granting that because they know CARB can go faster than the EPA. They know they can bypass the public comment, a lot of the pursuing litigation that would likely happen, and do this much more quickly. And if it fails, they have the luxury of blaming CARB and wiping their hands of it. So politically it has an appeal.
(08:56):
But when you look at it from our perspective, we want it to be successful. To do that in six years, you're going to have to have infrastructure to plug into. We all know that doesn't exist. Even with electric cars you rent, it's so impossible to find places to charge. Just rent one and you'll find out how taxing and emotionally draining that is. It's stressful.
(09:18):
For our industry that's certainly an issue. Beyond that, you've got to have power flowing through that infrastructure. So the grid, we've studied ... American Transportation Research Institute put out a report that 40% more capacity is needed on our US grid to charge every car and truck currently on the road. That does not exist, especially in states like California that have rolling blackouts. So that's a big issue.
(09:46):
Thirdly, the minerals that go into the battery, the graphite, the nickel, the lithium, the cobalt, those four ingredients, Andrew, come from two particular places in the world, China and the Congo. And I think we'd all agree, China is not the steady sourcing partner that we want. Congo, do we want six-year-olds digging this out of the soil for us? Not probably, no. So sourcing it domestically or from reliable sources not only will make the product more available, it'll bring the price down, and avoid all those entanglements from China trade tensions, to geopolitical tensions, to child labor.
(10:24):
Then you move on to price parody. We're talking three, four times as much for a brand new electric versus a brand new diesel. For medium and small companies, they will not afford that, even if they could get their hands on it. So the equipment that is available probably go to the largest fleets that have the strongest buying power. For those medium and small companies that are forced to buy it, can't afford it, even if they could get it, which is a question.
(10:50):
The last thing I would point to is the operational parody. It takes 15 minutes, Andrew, to fuel a diesel tractor to go 1,200 miles in any condition. Rain, snow, cold, extreme heat, it doesn't impact that platform. On electric, it takes up to six to eight hours to charge that vehicle to go at best 250 miles. By the way, the weight of those batteries is about 16,000 pounds total for two batteries, 8,000 pounds each, if you go with the largest for the biggest range.
(11:25):
So that counts against your payload. We're capped at 80,000. So now I've got to reduce it 16,000 pounds, which means I need more trucks to move the same amount of freight, which means I need more drivers, which we don't have. So you can see the circular effect. This isn't really thought through. That's CARB for you. The geniuses [inaudible 00:11:44] cubicle dwelling, Sacramento never took the time to really understand that reality and the impact it's going to have.
(11:52):
If you fast-forward to folks like you and I and those watching this podcast, wonder what's that impact, if you're concerned about inflation, this is going to cause it. If you're concerned about choice, you're going to go from eight apples down to three. These are the realities that come with these kinds of rules this fast. So I view it as a threat. I see consolidation in our industry. I see inflation. I see less choice. It is really a snowball effect that I think even most the common sense person, you don't need an economics degree to really appreciate this, it's very, very clear cut. We're not saying no, just give us time to let the market adjust to this sort of thing.
(12:34):
Start with school buses. Start with garbage trucks. Start with step vans that are delivering during the day, that can be back in non-peak hours and charge. Build the infrastructure, the grid, get the minerals sourced and the price and operational parity in check, and then start expanding outward to long haul. These are just common sense approaches that will get us there, just going to take a little bit longer. And I'd say renewable fuels, hybrids, any type of solution that reduces emissions should be counted, not rejected.
(13:11):
So we're out there pounding marble on this. I think it's something that we really need to amplify and I appreciate the opportunity to walk you through that. That's our biggest threat, Andrew.
Andrew Stasiowski (13:19):
No, I appreciate that. That's really helpful. And I think we've all been going through inflation, and as you discussed, what, 72% of all freight is moved by truck. You add inflation into that, just naturally you're going to see inflation go up in everything that's moved, in our products and every aspect of that.
(13:37):
I think you talked about the driver issue too. I know that's been an issue you guys have been working on a lot. What is the say to the drivers? When we talk about infrastructure and all we need to do, I mean, drivers are a critical part of our infrastructure. We might not see that as a road or a bridge, but the drivers are critical to our ability to move our freight and efficiently.
Chris Spear (13:57):
Yeah, it's one thing that a global pandemic will bring to the surface is sort of a granular understanding of what this means to me. I can't count how many times I went to a restaurant during and after COVID, as we came out of it, and the waiter or waitress would say, "We're really short tonight." Yeah, we noticed. Welcome to the show. We've been short on drivers long before COVID. You see it with airlines, whether it's pilots, flight attendants, ground crew, you see it at grocery stores, clerks, we're going to automated checkout. We're just short everywhere.
(14:30):
And so COVID really brought that to light. It's something we had been facing before. It went from 50,000 drivers short a year to now 78,000. To put that in context though, in Europe, was just over there, I try to go over once a year and kind of benchmark. There's a low conflict going on in Ukraine, and Ukraine and Polish drivers make up the lion's share of the workforce driver pool for Europe. And they recalled 70,000 Ukrainians to go fight. They were pulled out of the workforce and put into the front lines, and that's a major impact on their economy, ability to move freight. So Ukraine and Russia both passed legislation to allow women to drive. They didn't allow that. Whether it's conflict, they joined the ranks of a lot of Western countries in allowing females to be trained to drive because they don't have any drivers.
(15:29):
So impacts in geopolitical situations like that have dramatic ramifications on industries like ours and the economy. They're at 3% women driver force in Europe, we're at eight. That's nothing to brag about. We need more people with color, we need more gender, so we need to go into the urban environments and recruit. We need more women, which means we need more lit, secure truck parking. We need more exiting service members from the military that have this skillset. We have a place for them to make up to six figures of full benefits. Any part of the country that they want. Veterans, we shouldn't lose those folks to the ether. Bad things generally happen. They become dependent on controlled substances, they become homeless.
(16:19):
We have a place for them in this industry and we can keep that from happening. And that connectivity between our industry and, say, the Veterans Affairs Department and the Department of Labor and the Department of Defense is very critical. So workforce development takes on a lot of different parts and pieces to shore that shortage up. We have a technician shortage of about 30,000. It's not just drivers, it's the people that service these equipment that are getting more and more complicated as they evolve.
(16:51):
It's a very, very good place to earn a living, higher than national average earning without a college degree and all the debt that comes with it. So we're hoping to really capitalize on that, Andrew, and recruit new talent into the industry. I'd say 49 states allowing 18 to 20 to drive a Class 8, you just can't cross state lines. The Infrastructure Bill, we got some language in there to expand that. We're going to train them 400 hours with a mentor in the truck. We're going to have some technology attached to this solution. We're going to do it safely and we're going to do it responsibly. And I think getting into the high schools and getting young people that don't want to go to college familiar with our industry as an option, is very, very important to growth.
(17:33):
So there's a lot of things we have to do to make that happen. And walk me through those I think is a good illustration of how complex the issue is, but there's hope. I think we can give some new talent, new opportunities, and grow the industry and grow the economy as we go.
Andrew Stasiowski (17:50):
Yeah, I think you see reports about some of the starting salaries for truck drivers and the competition to get these drivers really does increase those opportunities for potential people to join the industry. It is a great industry. I used to work in it as well, and it's a great industry that helps America.
(18:05):
I wanted to move on a little bit. One of the things the Highway Users are focused on and really want to build out on is fixing the Highway Trust Fund and investing in new roads and bridges and adding capacity to alleviate bottlenecks. We had Rebecca Brewster on here from ATRI a few months ago, and she really talked about the bottleneck issues in their 2023 survey. How do you guys see infrastructure investment in fixing some of the bottlenecks and helping freight move more efficiently as well?
Chris Spear (18:37):
Yeah, it's clearly one of their most popular reports annually. They put out the top 100 bottlenecks. And folks on Capitol Hill pay attention to that because they want to know if they're on the list and if so, what are they doing about it? Well, here's what you're doing about it. You passed a 38% increase in road and bridge funding in the IIJA, the Infrastructure Investment and Jobs Act a couple years ago.
(18:58):
And I want to try and remind members of Congress because I think they've forgotten, take credit for it. It's funny because those that didn't vote for it are taking credit. They go out there and they got it both ways, okay, fine. But that road, that bridge, "I did that. I had a hand in making that happen." 38% increase in road and bridge funding over five years is pretty historic. We haven't seen that kind of investment since the Eisenhower era, so it is a big deal.
(19:25):
And I think that's our shop floor. It's where we go to work every day and downtime and repairs are excruciatingly expensive for our industry. We inflict a lot of damage on our equipment when we're driving through potholed areas and bridges that are completely deficient. So this does make a difference. It gets us from point A to B faster, more efficiently, more safely. And if we're not sitting in congestion, as ATRI reports, we're not [inaudible 00:19:54].
(19:54):
So there's something in this for everybody. If you're pro business, that's good. Prices, they come down, we can get things faster to market. Obviously good for safety, safety crowd should like that. Fewer fatalities, we welcome that. They're way, way too high. We need to take that to zero, as the secretary has said. And then for environmentalists, if you want fewer emissions, 67 million metric tons of CO2 emitted just from the trucks sitting in traffic, that's got to stop.
(20:24):
So moving and not sitting makes a difference. And there's something in this for everybody. So congestion is something that we really continue to point to. I don't know too many people that have never experienced it. If you live in DC you experience it almost every day, and it makes a difference. It touches every element of interest in this debate. And passing a bill like that should be a no-brainer. Why we have politicized a slab of asphalt is beyond me. Roads and bridges, as you know, Andrew, don't discriminate based on party affiliation, we all drive on them. And yet, here we are.
(21:05):
So getting a bill that, to me, scratches every itch and yet we still struggle to move it, that's a doggone shame. I remind people, take credit when you go back for this stuff. That's your district, that's your state that's benefiting, not just from the funds, but all the safety and efficiencies and environmental reductions that come from that investment. That is a good thing that should just roll off your tongue. And so we're really focused on this. It's a long slog. Just because we got that passed doesn't mean it's over. Getting the monies out there invested in the right projects are going to make all the difference.
Andrew Stasiowski (21:40):
Along those lines, and you talked it about a little bit with Europe, we need to really look at how we're investing in our infrastructure as well. We at the Highway Users believe there needs to be a global strategy for economic security and global competitiveness. How can we invest our infrastructure to make trucking more competitive in the global economy so we're onshoring and nearshoring jobs as well?
Chris Spear (22:05):
Yeah, I think obviously trade is critical to this. As I mentioned earlier, we move 76% of the trade from Mexico, Canada, in the US, so it is a significant number. That also goes off our West and East Coast shores. So if it's Asia-Pacific or Europe. It's going to be trucks moving it the minute that ship comes to port. We're moving intermodal, we're moving it into distribution centers and it parses out. And if it's going on rail, that's great too, we pick it up on last mile.
(22:34):
So these are all integrated that benefit within our supply chain from good trade agreements. We have not seen one trade agreement in the first three years of this administration. It's just absolutely jaw-dropping. We have got to work globally. It's also good diplomacy. So there's so many other things, global stability, that comes from that. Fewer people have skin in the game economically, they're less inclined to get in a situation that creates a war or blocking something, like 15% of trade through the Red Sea. These are all things that benefit from trade, so we need more of that.
(23:13):
And I think that also gives stability to our own Highway Trust Fund. We're paying nearly, as an industry, half the tab, state and federal. And that's fueled by a fuel tax, cars, trucks. As our economy and global economies begin to move to non-fossil based fuel sources of energy, our system is not set up to capture that revenue. So over the course of the next 10-plus years, we're going to see the Trust Fund dwindle and less money is being used to go into those infrastructure investments. And that has to be addressed now, not 10 years from now. The IIJ didn't do that, yet we're giving waivers to California to hit the gas within the next five, six years to electrify us.
(24:01):
So it's happening, but this disconnect between our federal and state agendas, and then factor in the global pressures as you just cited, are going to have impactful bearing on our Trust Fund's ability to maintain pace, to successfully fund that infrastructure at a level that it needs to be to grow the economy. Not just maintain it, but to grow it. And that's something that we really need to be zeroing in on over the next five, 10 years, to ensure that Congress is also transitioning the funding sources for that. If you're going to make us go in this direction, the next question is, how do you fund it? Because the current system is already deficient and you've got to make certain that the matched bearings with those two policies are absolutely integral.
(24:53):
Yeah, this is something that I think is very important for us to focus on and I appreciate you asking that question.
Andrew Stasiowski (25:00):
Yeah. At the Highway Users we totally agree, the Highway Trust Fund needs to be reformed. We are very concerned about the looming debt issues we're seeing with Social Security, Medicare, Medicaid, and the impact that could have on general funds. So it's clear we need to reform the Trust Fund to a more sustainable method going forward.
(25:19):
And the impact that could have on the trucking industry, I think we could turn back to it was, you talked about battery electric vehicles and how that's going to impact the cost of a new truck. The 12% federal excise tax that's connected to that will have a significant impact on you guys as well, correct?
Chris Spear (25:38):
Absolutely. And in the IIJA that we've been discussing, they did include an advisory committee of all lines to come together at DOT to really focus in on this solution. We've appointed Dave Williams from Knight-Swift, who has extensive background and chairing, not just our Environment and Energy Committee, but our Highway Policy Committee. So we feel we've got a member that has real-world experience and has led from a policy perspective, help shape what that should look like because this really is a longer term issue that new ideas need not only to be at the table, we need to be discussing them now.
(26:16):
And so the purpose of that, it saddens me that it's taken two years just to stand up the group, [inaudible 00:26:22] you started the dialogue yet. I know the secretary is very focused on this, Secretary Buttigieg, to get that going. And we need to be sharing that not just openly, but with Congress and helping them. And whether it's vehicle miles traveled or some kind of electronic odometer, some kind of fee structure, we've got to capture revenue from vehicles out there. And by the way, electrics are going to be a lot heavier. They're probably going to do a little bit more damage to the roads. They need to pay their fair share, and the system is not set up to capture that.
(26:53):
And so this dialogue is going to be essential in shaping what that could look and feel like and giving constructive ideas from Congress, and that's the way it should work. Having Congress try to come up with it on their own, that's not real-world experience. And it's probably going to have repercussions like I just outlined with CARB. They don't think these things through from our perspective, and you're going to do probably more damage than good.
(27:18):
I think this is going to be good dialogue and we need to get a solution in place soon. So I'm with Highway Users on this. I think this is something that is very much front burner, and if we're hitting the gas on the energy and environment side, we've got to have solutions in our Trust Fund that accommodate a steady revenue source long-term for our infrastructure.
Andrew Stasiowski (27:38):
Absolutely. I'm going to go into our last question, which we ask everyone, and I'm curious what your answer's going to be. It's been fun so far. If you could fix one thing to help the trucking industry, just wave your magic wand, what would it be?
Chris Spear (27:51):
Parking. Absolutely. It's a no-brainer for me because we have one spot for every 11 drivers today, and yet our DOT requires federally that they take 30-minute breaks. Well, if it's already filled and they can't find parking, they're going to park that truck in an on and off-ramp or in a lane that interacts with the motoring public, that's dangerous to them and the motoring public. So it's a safety issue, not only for a rested driver, but for everyone else out there sharing the road.
(28:22):
It's also a compliance issue. We want them to make certain they can comply, so they're going to need available parking to do it. It's also a time issue. They're running on average 56 minutes a day looking for that parking spot. That's crazy. And that average is about $5,500 of earnings that they're not making because they're busy looking for a parking spot to rest and comply with federal law.
(28:46):
So this is a problem. We had a billion dollars in the House bill authorized. I don't know why the Senate, bipartisan, took it out. , have to say and give just tremendous shout out to Secretary Buttigieg and his staff. They have done an outstanding job of leveraging IIJ discretionary monies to support this cause. We've had multiple state grants go out, from Florida, Tennessee, Louisiana, all the way to South Dakota. Did an event with the secretary out there on new truck parking, and that makes a difference. We need more states to apply for that money. It's available. So we sent a letter from all of our state association executives to their governors, reminding them that Secretary Buttigieg has this money available to them, you need to apply. And until we get that authorization, this is about as good as we can get on the front end of it.
(29:38):
But we need more parking, we need support. I'm getting it from the administration. I need to go back to the Hill and get it permanently authorized. So that would be the thing I'd wave that wand and fix.
Andrew Stasiowski (29:48):
That's great. Yeah, we have definitely supported you guys on that, and I agree, it's a huge issue for our ability to be efficient and competitive in the trucking industry and how we invest in the infrastructure in general. So totally agree with you on that.
(30:02):
Chris, I really want to thank you today for joining us. This was great. Hope to have you back on the Driving Forward Podcast again soon.
Chris Spear (30:08):
Thanks, Andrew, for having me. We covered a lot of ground and appreciate what you and the Highway Users are doing. And ATA is a proud member and really appreciates the opportunity to really bring our issues to the surface. I look forward to working with you in 2024.
Andrew Stasiowski (30:21):
Absolutely. Thank you very much.
(30:27):
All right, I want to thank Chris once again for joining us today to talk about the trucking industry and all the issues facing such an important part of our economy. Please subscribe and listen to the Driving Forward Podcast, wherever you get your podcasts.