ST. GEORGE — Through the heart of Southern Utah runs Interstate 15, a major commercial trucking route, by virtue of which the region is a natural location for companies and residents whose trade or employment depends on an effective and viable trucking industry – an industry that is one of the nation’s largest and that faces the impacts of new regulations imposed by federal agencies purportedly designed to reduce greenhouse gas emissions and “respond to global climate change.” While local companies are adapting, some have concerns and identify possible ramifications of the new laws.
The heavy-duty regulations
In June, the Environmental Protection Agency and National Highway Traffic Safety Administration implemented an unprecedented regulation program on heavy-duty vehicles to reduce greenhouse gas emissions and improve the fuel efficiency of semitrailers and similar vehicles, such as buses and heavy utility vehicles.
The commercial vehicles targeted in the new regulations make up the transportation industry’s second-largest contributor to oil consumption and greenhouse gas emissions in the nation.
The regulations are a joint action by the EPA and NHTSA as the agencies’ response to a Presidential Memorandum issued in May 2012. The new law has been developed with support from the trucking industry, environmental stakeholders and the state of California, according to the EPA’s Office of Transportation and Air Quality website. It follows President Obama’s agreements with major automakers to create fuel-efficient vehicles, when the historic 54.5 miles per gallon fuel efficiency standard was finalized on Aug. 28, 2012.
The heavy-duty program was created by lawmakers to reduce oil consumption and to address the EPA’s positioning for “global climate change,” a position that does not have congressional consensus.
According to an official report released in 2010 by the EPA and NHTSA, the then proposed program “would enhance American competitiveness and job creation, benefit consumers and businesses by reducing costs for transporting goods and spur growth in the clean energy sector.”
The agencies estimate that the combined standards have the potential to save approximately 500 million barrels of oil over the life of vehicles sold between 2014-2018, reduce greenhouse gas emissions by nearly 250 million metric tons and provide an estimated $35 billion in net benefits to truckers, or $41 billion in net benefits when societal benefits of clean air and better health are included.
EPA and NHTSA estimate the program will cost $7.7 billion.
EPA and NHTSA estimate the program will generate $49 billion in societal benefits, such as the $41 billion in estimated benefits as a result of higher standards of forthcoming vehicles, creating long-term savings due to reductions in mechanical issues, fuel costs, lower annual miles and technology upgrades.
The emissions from nongreenhouse gas pollutants are also benefits which have yet to be quantified, according to the agencies.
In part, the magnitude of the work done utilizing semitrailers with tons of freight led to the environmental regulations, such as manufacturing and updating old motors to reduce fuel and greenhouse gas emissions.
Warner Truck Centers in Hurricane
Washington County is a prime location for truckers and trucking-related businesses. One of the more recent additions to the local market and economy is Warner Truck Centers, which opened in the Gateway Commercial Center in Hurricane in March this year – its fourth location overall.
A Freightliner dealership, managed by Scott Saxton, occupies three of the eight buildings in the Gateway Commercial Center, utilizing more than 35,000 square feet on 7 acres.
There are a total of 70,000 square feet of facilities currently in the Warner Truck Center in Hurricane with room to add several more. The remaining property and buildings are used to house other heavy-truck users and industry vendors. Quality Tire, a Michelin tire distributor has also moved in and discussions are underway with several other vendors to provide other services such as, a café with hot food, a truck wash, and trailer repair and refrigeration services. Plans are underway for a driver center which will have hot showers wireless Internet, big recliners and even office space to rent, lease or buy. A body and paint facility will open later in September utilizing a 100-foot Binks downdraft paint booth.
The Center opened with five Freightliner-certified technicians and now has eight, with plans to add more as soon as they can be trained and certified to work on Detroit Diesel, Cummins Cat and all Freightliner chassis components. Parts and service sales have had steady increases of 25 to 30 percent each month since March.
Another major focus of Warner Truck is motor home repairs. Freightliner Custom Chassis, owned by Daimler Trucks of North America, now produces 60 to 70 percent of all the chassis for all of the motor homes manufactured in the U.S. The service brand for providing warranty mechanical repairs is known as Oasis. Freightliner of Utah was awarded Oasis’ highest honors last year, in customer satisfaction as one of its top service centers in the nation, at the Freightliner dealership in Salt Lake City.
Warner RV and Fleet storage will be open in mid-September offering inside storage with fire sprinklers, heating and cooling, and all the services necessary to winterize, excercise during storage and de-winterize right on site. There are 4 acres that have also been improved for storing trailers or other equipment. They are encouraged about the way the business has been received, the company’s former CEO Bart Warner said, and by how it is growing with several new truck orders in the past few months in the area; he said they look forward to a lot more growth in the future.
Warner and others on the impacts of the “Heavy-Duty” regulations
When the regulations were announced, some trucking companies initially feared any trucks manufactured before 2010 would be taken off the roads. Even more alarming for many was the fact that these regulations hit right after the new trucking hours of service regulations, which affected weight and time limitations for drivers. But nearly all states, with the exception of California, have not yet cracked down on the industry regarding the new regulations which pertain to greenhouse gas emissions.
Warner Trucks was able to adapt to the new regulations; Warner said: “The EPA comes up with tighter restrictions about every three years.” For example, he said restrictions tightened up in 2003, 2007, 2010 and will be more stringent in 2014.
“The technology has shifted in the past few years, with such things like expensive Diesel Particulant Filters and Diesel Emissions Fluid, the evolution of engine designs in 2010 to have up to 35,000 pounds per square inch in the common rail fuel systems with three to four injections per cycle, and automated manual transmissions, among others,” Warner said. “We don’t need to put hoses on exhaust pipes now because the air coming out of the exhaust is so clean. The carbon coming out of the air in the exhaust is only 2 parts per million. So that is cleaner than the air in the largest 50 cities in the US.”
The Freightliner brand, which is compliant with all regulations, manufactures about 40 percent of the medium and heavy trucks being sold in the U.S. today and around 60 percent of the trucks being sold Utah, Warner said, noting that Freightliner trucks with Detroit engines have become the standard for fuel economy in the industry. The most current Freightliner models can get 8 mpg grossing 80,000 pounds.
“Without trucking, we’re in big trouble in the U.S. and especially in the West,” Warner said comparing the industry to Europe where freight can be easily moved from one country to the next on trains and therefore sees little use for trucks.
California does have the toughest emissions regulation in the country, Warner said, but it has offered rebates of between $25,000 to $50,000 to companies buying trucks in California in order to offset costs of getting rid of their trucks without diesel particulate filters. By the end of next year, all trucks going into California will be required to have diesel particulate filters, or DPFs, on their trucks to get through the state’s port-of-entry. This will affect most long-haul carriers that do not have current model equipment.
U.S. Congressman Chris Stewart, serving the residents of the 2nd Congressional District of Utah, said in a town hall meeting in St. George this week that the EPA has been arrogant with proposed regulations that are impossible for western states to comply with. Stewart said that transportation loses federal funding if it’s not in compliance with the “clean air standard,” and that two weeks ago he proudly signed a subpoena requesting the EPA’s science. He said that thus far the EPA has been unwilling to share that science.
“The new standards apply to new motors. Any new manufacturing will require new EPA standards,” Dan Ipson of DATS Trucking, based in Hurricane, said. “It is not likely old trucks will be wiped out. However, California has stringent standards, so routes may be affected.”
“It’s a bunch of nonsense,” Ken Holm, owner of Statewide Transport Inc. with locations in Washington County and in Woods Cross, said. Because Statewide’s trucks do not comply with the new California regulations, Holm has been forced to seek routes elsewhere. He predicted freight prices may rise in California because newer trucks will be the only ones allowed in the state.
“We do not go to California,” Mike Vorwaller, owner of the Oregon-based MV Supply, said. Vorwaller has spent the past few years upgrading all of his trucks to the standard of the new regulations, so MV Supply had minimal financial impacts due to the regulations. He said he sympathizes with companies who have lost contracts due to the new regulations.
Whether the new regulations will put some small companies out of business, Vorwaller said, “depends on where you’re running and the situation of your business.”
The trucking industry comprises approximately 3.5 million professional drivers across the country, according to the American Trucking Association, and the total number of people employed by the industry as a whole exceeds 8.7 million people, which is about 1 in every 15 workers in the U.S.
The American Trucking Association also estimates that more than 400 billion miles are traveled by professional truck drivers each year, and that the trucking industry hauls more than 10 billion tons of freight annually. According to the association’s data, in 2009, trucking was a $544.4 billion industry, representing 81.9 percent of the nation’s freight bill. By contrast, rail transportation accounts for about 13 percent of the nation’s freight tonnage.
The trucking industry is economically intertwined with health, retail, energy, construction, manufacturing, wholesale, resource, agriculture, lumber and many more industries and sectors of commerce.
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Ed. note: “unfazed” revised to “able to adapt” – paragraph 19.
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