Archive for December, 2010|Monthly archive page

Solving the US-Mexico Trucking Problem

Ten steps toward a solution

Unless you’ve been living under a rock, you should be aware of the current trade spat between the US and Mexico over allowing Mexican trucks to operate in the US.

There are legitimate causes for concern, particularly from the US point of view.  The thing is, these could be addressed relatively easily.  This post will take a look at some of the items of concern.

First, if you haven’t already done so, read my post about Mexican cross-border trucking here:

For the purposes of this post, when I say truck, I’m referring to a five axle tractor-trailer, as is commonly operated throughout North America.

First on the list of concerns (at least my list) is safety.  We can divide this into three general areas:  vehicles, drivers, and cargo.

Let’s take a look at vehicles first.  The number one key to keeping a vehicle in good and safe working order is proper maintenance and inspections.  From everything I’ve seen, this just does not happen on a regular basis for trucks coming out of Mexico.  Please don’t accuse me of prejudice.  I can tell a safe truck from an unsafe truck.  The issue has been raised that the Mexican trucks I see in the border zone aren’t typical.  Maybe or maybe not.  The bottom line is, they’re being operated on US highways, and need to be in compliance with the regulations regarding equipment.  Period.  The good news is, there seems to be more action by the US authorities on cracking down on these trucks.  I picked up a load in Laredo last week.  When I got to the forwarder, I was told that the trailer hadn’t come across the border yet, but they expected it to arrive in an hour or two.  Nine(!) hours later, here comes the truck and trailer – on a wrecker.  Evidently, the truck had been inspected at the border and placed out of service, so they brought it in on a wrecker.  Works for me — I got my load and went down the road.

When it comes to properly maintaining trucks, it pretty much boils down to money — namely, the willingness (and ability) of the truck’s owner to pay for maintenance and repairs.  To be fair, this is true of all trucks – not just those from south of the border.  If freight rates are too low, profits are small, and one of the first things to go is maintenance — the old “we can get a few more miles out of it before we really have to fix it” mindset.

The ports of L.A. and Long Beach in California have been trying to address a similar problem with the drayage drivers that work the ports.  Their approach was to ban owner/operators, and require all drivers to be employees of a trucking company, the theory being that a company will run newer trucks, and maintain trucks better than o/o’s will.  The whole port thing has been the subject of a bunch of legal wrangling ever since it was proposed, and is still ongoing.

Action #1 – Set minimum freight rates for all freight moved within the US.

I’m not a big fan of government regulation of anything, but I think there should be a reasonable minimum freight rate set, that will allow companies to make enough that there won’t be any excuse for poorly maintained trucks.

Action #2 – Require more frequent vehicle inspections.

Other than a daily pre-trip inspection by drivers, the Federal requirement is only for an annual inspection.  A lot can break on a truck in a year’s time.  This should be bumped up to quarterly.  That’s still quite a while between inspections, but more frequently would help.

Action #3 – Require that vehicle inspections be done by a certified 3rd party inspector.

Right now, trucks can be inspected by pretty much whoever.  I can go buy a blank inspection form and inspection sticker, fill it in, and stick it on the truck myself.  Perfectly legal, as long as I’ve actually done the inspection.  Requiring inspections to be done elsewhere (and auditing inspectors) would help.

Next, let’s look at drivers.  We can further divide this item into operations, and qualifications.

Let’s tackle qualifications first.  All truck drivers are required to hold a valid Commercial Driver’s License (CDL).  There are a series of qualifications required to obtain and maintain that license, which I won’t address here, with one exception.  There are rumors and conjecture that obtaining a CDL south of the border is simply a matter of handing the right amount of cash to the right person.  That wouldn’t surprise me a bit, since it can be done that way here in the US, so I think it likely that is probably true.  Every now and then, some 3rd party CDL tester (in the US)  gets shut down for handing out CDL’s to people who can’t drive.  One of the usual results of this is that everyone who got their license from that tester get pulled back in for retesting.  The perception is, that such things are far more common south of the border.

Action #4 – Mexican drivers should be required to take and pass the CDL skills test at a US testing location.

It may seem discriminatory and unfair, but doing so would silence the critics on this particular issue.

The one CDL qualification that I will discuss here, is the requirement to be able to speak and understand sufficient English to communicate with the DOT and law enforcement personnel.  As mentioned in another post on my blog, there have been quite a number of citations handed out in the US for insufficient language ability.  This requirement should actually be modified to “be able to speak and understand sufficient of the language of the country being operated in to communicate with the DOT and law enforcement personnel”.  Specifically, every CDL holder should be tested on and in the appropriate languages.  There should be three possible endorsements: English, Spanish and French.  If a driver is operating in the US, that driver needs the English endorsement.  For Mexico, Spanish.  For Quebec, French.  Eventually, we may have drivers going to and from other South American countries, so possibly Dutch and Portugese will eventually need to be added.

Action #5 – Add language endorsements to the CDL

Some years ago, I took a load into Quebec.  I know just about enough French to be dangerous in a French restaurant, and that’s about it.  It was one of the scariest trips I ever had, so I can sympathize with how a Mexican driver with only a limited knowledge of English would feel driving in the US.  It may seem like a small thing, but take it from me, it’s really a major issue.

When it comes to operations, the #1 concern raised by many is driver compliance with the DOT Hours of Service (HOS) regulations.  This is nothing new, and has been a problem everywhere since the regulations were first put into effect, and is not limited to drivers from any particular country.  The solution is pretty simple – require Electronic On-Board Recorders (EOBR’s) for all trucks.  The DOT already requires them for trucking companies with safety problems.  Many other companies are also using them, since it simplifies the handling and auditing of driver logs.  The company I lease to uses them, and I like it a lot better than paper – much simpler and faster.  They’re not particularly cheap, but then, they’re not that expensive either.

Action #6 – Require EOBR’s for all trucks operated within the US.

There is a great deal of resistance from many drivers over EOBR’s.  Having one means the elimination of “creative mathematics” when it comes to logging hours.  The perception is, that it’s going to reduce driver’s wages.  My philosophy is, if I can’t make a decent living with one logbook and operating within the regulations, then I’m working for the wrong company.  I don’t want to work that hard, or expose myself to the liability risk.

There’s also resistance from some companies on two fronts:  first, the cost of installing an EOBR, and second, liability issues.  There are a lot of companies that do push drivers harder than they should, and an EOBR would show this.

Another concern is that of having the required insurance and permits for trucks operated in the US.  Our entire system of licensing and permitting trucks is still rather antiquated.  I carry a binder around an inch and a half thick, that has nothing but permits and the like.  Whenever I get inspected by the DOT, I have to drag it out and show the inspector my registration, insurance card, IFTA permit etc.  Usually they don’t check much more than that, unless I’m hauling hazmat.  It’s still an improvement from the days when I started trucking, when the binder was about twice the thickness of the current one, and the truck was covered with all kinds of stickers and plates.  Now, my truck is down to just one plate, with an IFTA sticker on each side.  Not perfect, but better.

What we really need, is a central repository of the required information, and a means for the authorities to verify that information as needed.

We’re actually part of the way there.  Let me digress a moment and talk about Automatic Vehicle Identifiers, or AVI for short.  You’ve probably seen them, and may even have one — basically, we’re talking about an electronic toll tag on steroids.  I have one in my truck – it works as a toll tag, and also identifies my truck to the DOT.

You’ve probably seen the signs on interstate highways around weigh stations that say something like “AVI trucks follow in-cab signals”.  A little further on, you’ll see an antenna or two mounted on poles, and maybe some plates set in the roadway.  What happens is, first, the weigh station interrogates the truck’s transponder, which identifies it.  Next, the truck is weighed (by those plates in the roadway), and the information is transmitted to the weigh station.  The weighmaster can then decide to pull the truck in, or not.  It can be automatically set to pull in trucks over a set axle or gross weight.  Trucks are also pulled in randomly.  Random pull-ins are a percentage, based on a particular company’s safety result, but is at least five percent.  If the weighmaster chooses not to pull in the truck, a green light flashes on the transponder (and it also beeps) , which tells the driver to proceed without stopping.  A red light will illuminate (with a different pattern of beeps) instructing the driver to pull in to the weigh station.  Not getting any indication is treated the same as getting a red light.  After getting a red light, it’s the same thing as a non-transponder equipped truck going through a weigh station.

AVI has a number of benefits for both drivers and the DOT.  Drivers benefit from time saved, and reduced fuel consumption.  When I first got my transponder, I was on a dedicated run, and had to make 6 scale crossings a week.  AVI gave me an increase of about a tenth of an mpg.  This may not sound like a lot, but it works out to around 200 gallons a year of diesel fuel saved — and that’s based on an average of about one scale a day bypassed.  In some areas of the country, there are far more scales, so 200 gallons a year per truck is probably very much on the low side of savings.

For the DOT, it lets them concentrate their enforcement efforts on trucks and companies that are more likely to have problems, and not waste time on compliant companies.  For example, when you go through Colorado, you’ll get pulled in at the first scale you come to.  They’ll do a check of your registration etc. and enter it into their computer system.  After that, it’ll likely be a year or so before you have that checked again, since they already have the information linked to the truck’s transponder.  Saves time and effort for everybody.

Action #7 – Require AVI transponders for all commercial vehicles operated in the US.

A system such as used by Colorado could be done nationwide, and all of the information stored centrally, with insurance companies being required to report policy validity, state operating authority, hazmat authority etc. all maintained, which could largely automate paperwork checks, and allow more manpower to be used for inspecting equipment.  Transponder readers could also be added on highways around the country that could be used to audit fuel tax returns, help track stolen trucks, and those violating the regulations regarding cabotage.

One of the concerns of the trade unions involved is the loss of jobs and erosion of wages due to cabotage.  As applied to trucking, the term means a load is moved within a country by a truck registered outside of that country.  This is a legitimate concern, and a concern of mine as well.  There are a lot of shippers who simply don’t care who moves their freight – as long as it’s cheap.

Action #8 – Implement stiff penalties for shippers, brokers, receivers, and carriers violating the cabotage rules.

These regulations need some serious teeth – as in space alien monster sized teeth.  The penalties need to be substantial enough that nobody will even think of doing it.

I wrote earlier about setting minimum freight rates to help with maintenance.  These are also necessary for companies to pay drivers a reasonable wage.  Most people outside of the trucking industry don’t realize that wage and hour laws don’t apply to anyone subject to DOT hours of service regulations.  No minimum wage.  No overtime.  So, if you can convince somebody to drive a truck for a nickel an hour, and work a 70 hour week with no overtime, it’s perfectly legal to do so.

Action #9 – Set a reasonable minimum wage for all drivers operating in the US.

The whole idea about setting minimum freight rates and wages, is to create a level playing field.  By doing so, I think it would silence most of the critics about complying with the NAFTA provisions on cross-border trucking.

The final area that I want to address is that of smuggling.  Whether it’s guns, drugs, illegal aliens or whatever, it’s a serious problem now, and opening up our border has the potential to make it far worse than it already is.  In this area, the main stumbling block seems to be the sheer volume of freight moving across the border.  It’s far more than it’s currently possible to inspect.

Action #10 – Inspect 100% of all trucks crossing the border.

This action seems to conflict with the statement I made in the previous paragraph — or does it?  As the system is currently constituted, yes, it’s impossible.  However, we could change the way we do things, and cost effectively inspect 100 percent.  How? By distributed labor.  If you haven’t heard of it already, go take a look at Amazon’s Mechanical Turk here:

Basically, what you can do is divide up a task (such as looking at x-ray images of trucks) among thousands or tens of thousands of workers.  So, we require every truck that crossed the border to get x-rayed. First we add a whole bunch of truck x-ray machines.  Then, we set a reasonable amount for each one looked at, throw in a substantial bonus for finding a smuggler, and tack the price on to the customs fee that’s already collected for crossing the border.  While such a system won’t catch everything, it could augment the existing border inspections, and help CBP target their conventional inspection efforts more effectively.  This also has the added benefit for people who are otherwise unable to obtain conventional employment a new avenue to earn a wage.  All they would need is some vetting,  training, a computer, and an internet connection.

The above ten points, while not totally comprehensive, should at least point the way to solving the problem that seems to have eluded the politicians on both sides of the border.

Comments and questions are welcome.