Port mess revisited

May 6, 2009
“The claims made by the CFC are absurd. Only creditworthy customers are approved and to date not a single one has defaulted. In a discussion with the CFC last fall, we pointed out the inaccuracies of their report which at the time they acknowledged, but ...

The claims made by the CFC are absurd. Only creditworthy customers are approved and to date not a single one has defaulted. In a discussion with the CFC last fall, we pointed out the inaccuracies of their report which at the time they acknowledged, but apparently continue to claim.” –Jack Ferry, media relations, Daimler Financial Services

So I got a call from Jack Ferry of Daimler Financial Services following my post yesterday about the clean truck program mess out at the Port of Long Beach, upset that I seemed to be saying all the accusations leveled by the Consumer Federation of California against Daimler Financial Services were true. That is NOT what I was saying, nor should it be construed as such.

That also wasn’t even remotely the point of my post, so let’s revisit these extremely touchy issues over clean air, truck leases, and a wide variety of other items swirling around the efforts by California’s two major ports to reduce truck exhaust emissions.

The first reason I quoted the CFC’s extremely nasty letter to Dieter Zetsche, Daimler’s chairman, yesterday was to show just how far off the reservation the Port of Long Beach’s effort to reduce truck emission levels has gone. It’s a total soap opera, with people hurling invective that should be confined to rarely watched cable TV shows late at night.

The second reason, which I didn’t seem to convey well enough, is that the wild accusations against Daimler totally miss the point. This company wouldn’t even be involved with the clean truck program if the port hadn’t so heavy-handedly targeted a whole slew of truck models for elimination, then left the burden of buying new trucks on the backs of owner-operators. Daimler got called in by the PORT to offer a way for port truckers to finance equipment, not the other way around.

The port situation is actually reflective of the larger emission-reduction problem facing the entire trucking industry. The federal government established firm mandates for the reduction of particulates and oxides of nitrogen (NOx), significantly adding to the price tag of new Class 8 tractors – boosting sticker prices by 5% to 10% in 2007, with another 5% to 10% increase on the way for 2010. Consider that a basic Class 8 model now costs over $100,000 makes such emission-related upcharges a big bill to swallow for smaller operators.

So the Port of Long Beach asks for help in arranging some way for port truckers to get cleaner equipment, enlisting Daimler Financial Services to help. Now everyone is screaming about Daimler; well, I say, why are they there in the first place? They didn’t come up with the clean truck plan – the Port of Long Beach did. If the economics for port truckers are so bad, if public interest groups claim these truckers can’t afford it, why don’t you instead put the clean truck program on hold for a year or two, until the economy recovers?

Then there are all the regulations and fees attached to the clean truck program that don’t have anything to do with reducing emissions – part of the “concession plans” both the ports of Los Angeles and Long Beach designed – at least as far as I can see.

In fact, Judge Christina Snyder of the U.S. District Court for the Central District of California – following guidance from a U.S. Court of Appeals for the Ninth Circuit ruling made back in March – recently put many of the tenets of those plans on hold.

A refreshing change of pace would see the ports use a plan similar to the Environmental Protection Agency’s SmartWay program, whereby carriers AND shippers both put some skin in the clean air game. The key benefit to SmartWay is that is uses POSITIVE incentives to get carriers to adopt fuel saving and emission reduction strategies – with the shippers providing the monetary and business incentives to do so.

A good example of how this works comes from Bay & Bay Transportation up in Rosemont, MN. I interviewed the company’s president, Sam Anderson, last year about the main reason they made the move to become a SmartWay approved carrier “One of our largest shippers told us that if we became a SmartWay carrier, they'd put us on a different fuel surcharge that would give us four cents more per mile,” he told me. “That's some serious money.”

That’s a model the ports could use to encourage truckers to upgrade to newer trucks or retrofit their older models to reduce emissions: access to higher compensation, not just to avoid excessive fees. That, I think, would’ve created a much more positive outcome, instead of the soap opera we’re witnessing today.

About the Author

Sean Kilcarr 1 | Senior Editor

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