Regulations

 

Greenhouse gas and carbon emissions are becoming more and more of an issue across the country. Fuel emissions from vehicles account for a large percentage of air pollution that occurs in the U.S. In fact, in California, 37 percent of greenhouse gas and criteria emissions come from commercial trucks and buses. Additionally, a fifth of all emissions in the state come from diesel fuel.

Across the country, the federal, state and local governments are creating initiatives to promote cleaner air for everyone and the planet. These projects involve everything from setting higher standards for technology, to providing incentives and grants to drivers.

California Initiatives to Reduce Emissions

California is leading the way in creating clean-air initiatives that work to minimize the pollution released into the air from cars, commercial vehicles, and other sources. The California Air Resources Board (CARB) is California’s primary agency committed to protecting public health from the negative effects of air pollution. This organization works throughout 35 local air pollution control districts. It also leads the state in addressing worldwide climate change issues.

In 2012, CARB released the landmark Truck and Bus Regulation, which called for commercial trucks, including semi-trucks and buses, to be upgraded and replaced over time with less-polluting trucks throughout the state. This is because these high-polluting trucks are responsible for 90 percent of diesel pollution and 80 percent of smog-forming pollution. CARB hopes that in 2023, California’s trucks and busses will be 90 percent cleaner than in the year 2000.

Getting enough low-emission commercial trucks becomes a challenge due to the high cost of these new trucks. Since many are still in testing phases and supply is low, the cost of these vehicles is out of reach for many freight owners. To help with the cost of upgrading to a cleaner truck and reach their goal of getting as many low-emission commercial trucks on the road as possible, The California Air Resources Board has launched the California Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project (HVIP). This program allows truckers and fleet owners in California to invest in low-carbon electric trucks faster than would be possible otherwise.

What is the HVIP Project?

HVIP is a unique program that hopes to replace traditional trucks and buses with low-carbon hybrid and electric commercial vehicles quickly by offering vouchers to qualifying freight owners. Because the largest barrier most freight owners face when it comes to supplying their drivers with updated, low-emission vehicles is the high price of these trucks, this program could greatly benefit them. With the help of a grant, owner operators can start making less of an environmental impact sooner rather than later.

As of 2019, HVIP has been able to replace more than 3,500 medium- to heavy-duty commercial vehicles. This has led to a 30 percent growth in the nation’s early market of zero-emission and hybrid vehicles. It has also helped create jobs, increase the demand for these technologies, and advance the zero-emission truck industry.

Clean Air Action Plan Technology Advancement Program

Another initiative aimed at progressing technology faster in hopes of sustaining the environment is the San Pedro Bay Ports Clean Air Action Plan Technology Advancement Program (TAP). This initiative, based out of Long Beach and Los Angeles, is committed to encouraging the development of emission-reducing technology and getting that technology to the port market as fast as possible. They work closely with developers and port industry partners to help test, commercialize, and promote the widespread adoption of technology that will help keep the air clean at ports around the world.

Early Adopter Truck Incentive Program 

The Port of Long Beach as well as the Port of Los Angeles are expanding their initiative to help get truckers behind the wheel of less-polluting rigs by giving dozens of truckers up to $100,000 each to upgrade their trucks. Known as the Early Adopter Truck Incentive Program, this concept has earmarked $14 million to help pay for new, lower emission, natural gas-powered trucks. To receive funding through this program, truckers would have to be members of the ports’ truck registry, and they would have to agree to scrap their existing truck.

Promoting a Healthier Planet

The future of trucking looks bright thanks to advancements in AI technology, the rise of electric trucks, and environmental initiatives that help to improve these commercial vehicles as well as the planet. Because of HVIP, TAP and similar programs, we can expect more fuel-efficient, responsible trucks on the road, which means owner operators and other drivers are safer than ever before. And since these new trucks are producing fewer emissions, citizens of California are able to breathe easier and create a better world for future generations. Hopefully, the combination of government initiatives and advancements in technology will be enough to preserve the planet.

 

Throughout 2018, the heated trade war between the U.S. and China has been full of twists and turns. The changes in taxes is an effort to boost the American economy by encouraging less outsourcing and bringing more manufacturing to the U.S. However, some new policies put into place earlier this year have caused difficulty for multiple industries. But what does this all mean for the trucking industry? Could the new tariffs mean less trade and an end to the demand for truckers across the U.S.? Here is what you need to know regarding the new tariffs against China.

Trade War with China

The trade war between China and the U.S. has been a roller coaster, especially throughout 2018. Not only has the U.S been levying tariffs on over $250 billion of imported goods out of China, but China is fighting back with $110 billion on the U.S.

Now, as 2018 comes to a close, the nation awaits the $267 billion in tariffs against China taking effect on Jan. 1. This round of tariffs is expected to hit far closer to home, as businesses of all sizes and industries, as well as consumers, feel a direct effect. Prices on consumer goods including tires, furniture and especially technology are expected to be the first to rise dramatically.

An Argument for Tariffs

Over time, those in favor of the tariffs are hoping the new taxes will boost the American economy. Because of the new tariffs, businesses will be able to charge higher prices for consumer goods. Additionally, domestic producers will profit more by investing in factories on U.S. soil. In theory, this will create millions of new jobs in the U.S. and improve the economy exponentially.

However, the higher taxes mean higher prices for the American people as well as businesses big and small. This could potentially cause the U.S. economy more harm than good, as business struggle to stay afloat while adjusting to the new costs.

New Tariffs Already Affecting the Automotive Industry

The industry in the U.S. already feeling the effects of tariffs includes the automotive industry, which is having to dig deep to afford the new taxes on vital materials like steel and aluminum. In fact, because of the rise of cost in imported goods, some American-based factories are considering taking their business overseas to avoid the taxes.

This is the case for Harley-Davidson. Their chief financial officer, John Olin, projected the new tariffs would cost them an extra $40 million in 2018, due to the increased cost to import materials. This economic hit has left the motorcycle company to consider moving production out of the U.S. entirely.

New Tariffs Could Directly Affect Consumers 

While most other tax changes have not directly affected American consumers, these new tariffs against China could result in price increases on things people purchase every day. From canned goods to technology, large retailers like Target and Walmart have expressed concern about being forced to raise prices on their imported products.

In September, the director of global government affairs for Walmart wrote a letter to U.S. Trade Representative Robert Lighthizer discussing the impact the new tariffs could have on the American people. The message listed everything from clothing to dog leashes that would see a raised price after the new tax took effect. However, the letter stated that the worrisome increases could be on electronics, cosmetics and products for children. Walmart’s representative said she feared, “Increased costs associated with new tariffs could lead families to turn to cheaper, but less safe options to offset new financial burdens.” 

What it Could Mean for Truckers

So, what does this mean for truckers across America? If less goods are entering the country and Americans are buying less due to price increase, it seems that truckers could also see a decline in job security. However, while these new tariffs could mean a lot of adjustments for businesses big and small, the chief economist for Freightwaves, Ibrahiim Bayaan, believes the demand for truckers will continue to increase.

He projects that these new tariffs will inspire businesses across the country to stock up on goods before the new tax comes into play. This would mean, in the short term, even more work for truckers as the surplus of goods flow in. Bayaan states that this extra backup of goods will give businesses time to come up with a plan to stay ahead of the tariffs and not allow it to affect their business or their prices for long.

This means that business will remain consistent and even increase for truckers. As more factories and manufacturers become a part of the U.S. economy, the transportation of goods will only grow in demand. Into the foreseeable future, despite any tariffs or AI advancements, there will still be a large need for commercial truck drivers all around the country.

 

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If you’ve been on the road for long, you may remember that the driving age for interstate commercial transportation is 21 years old. According to the Department of Motor Vehicles, a potential driver can obtain their commercial driver’s license (CDL) at 18 today, but only to drive within a given state’s lines. To haul across the country or handle hazardous materials, 21 is the minimum age. But lawmakers are now considering a bill proposed that would allow 18-year-olds to legally drive 18 wheelers nationally. Truck driving is a lucrative opportunity for young people and the industry is vying for new drivers. While lawmakers argue that this bill would ease the driver shortage, truckers around the country raise concerns over safety on the road.

Why Do We Need to Change Driving Age Laws?

Senator Duncan D. Hunter, a Republican from California, proposed the bill in March of 2018. Younger drivers have always been on the lower end of age demographics in the trucking industry. According to this chart supplied by the American Transportation Research Institute, drivers aged 20 to 24 made up less than 10% of the force in 1994, 2003 and 2013. In 2013 specifically, that percentage fell below 5%.

It’s no secret that the commercial transportation industry is undergoing a driver shortage. For example, the American Trucking Association reported in October of 2017 that the national trucking shortage reached 50,000 drivers—and this number could rise to 174,000 by 2026. Companies have increased pay and benefits in an attempt to incentivize potential drivers. In fact, some economists argue that wages in the trucking industry are still far below the necessary threshold to attract workers. If companies continue to raise wages in order to attract or keep drivers, this is likely to greatly ease the shortage.

But what happens when these measures aren’t enough? Senator Hunter argues that lowering the interstate driving age would positively impact young people with high school degrees who want stable, well paying careers. After all, the average income for a truck driver is still around $60,000 per year. Because many truckers are now retiring, it’s crucial that enough new drivers are hired within the next 10 years.

The Bill and Safety Concerns

On top of this, young people age 18 to 20 have the highest unemployment rate of any age group. This makes sense: industry opportunities aside from the military or higher education are scarce. Truck driving is a stable career with opportunity for upward mobility and pay raises. Compared to the limited similar opportunities in the retail, food service or construction industries, commercial transportation and commercial truck driving is worth diving into young.

The trucking community largely argues that bestowing drivers so young with this much responsibility is risky. This concerned is founded: In 2016, the Center for Disease Control actually reports that teenagers aged 15-19 years old were responsible for 8.4% of the total costs of motor vehicle injuries relative to their 6.5% of the U.S. population. Similarly, commercial vehicle drivers between 19 and 20 years old are six times more likely to be involved in fatal accidents. Younger drivers simply have less driving experience overall, not just with semi truck driving. Not only is preventing dangerous accidents a priority for truck drivers, semi truck accidents could lead to costly damages to loaded goods. Many believe that the industry would benefit more from direct improvement strategies than throwing cheap labor at the problem.

The Upside of Younger Drivers Nationwide

On the other hand, proponents of the bill argue that the drivers under 21 would be required to jump through preventative safety hoops. This includes an apprenticeship program requiring 400 total hours on-duty with 240 of those hours under supervision of an experienced driver. It gets better: all training trucks will have cameras and a maximum set speed of 65mph.  Senator Hunter also points out that there are already 18 and 19 year old drivers on the road anyway and that this change wouldn’t have a significant impact on road safety. But opportunities for work and advancement are more scarce within a single state’s lines as a driver, especially if your state is particularly small.

Providing extra incentive to young people considering a commercial driving career could promote relief from the driver shortage. Although there are safety concerns to consider, many believe that this law change would do more good than harm. A pilot program by the Federal Motor Carrier Safety Administration is set to launch at the end of this year, allowing 18 to 20 year-olds with a military commercial driving license to drive interstate in the U.S. As for other young drivers, the legislation is still out.

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You don’t often hear about high profile trucking cases gracing the supreme court. But that changed this fall with New Prime v. Oliveira, which could influence hundreds of thousands of American truck drivers and even consumers. Why is this case important, and what do truck drivers all over the country need to know about this case? Learn more about the scope and impact of New Prime v. Oliveira.

Dominic Oliveira filed suit three years ago against New Prime trucking company, a commercial transportation company that specializes in flatbed, refrigerated, tanker and intermodal divisions. Dominic Oliveira claimed that the company neglected to pay him even minimum wage and charged him for working. An incomplete panel of Supreme Court justices heard the case on Wednesday, October 3rd and considered the arguments.

Oliveira claimed that New Prime violated the Fair Labor Standards Act (FLSA) and that the company did not treat him as an owner-operator but rather as an employee. Oliveira claimed in the suit that New Prime controlled his work schedule and dictated him as an employee. According to the United States Department of Labor, the consequences of independent contractor misclassification include missing benefits like overtime, medical leave, unemployment insurance and a safe workplace.

If you’re new or unfamiliar with the trucking industry, there are two types of drivers on the road. Company drivers are usually employed by a company and paid cents on the mile. This might vary depending on the type of route you drive, as well as the division. Independent contractors, also known as owner-operators, usually make a percentage of their bill for each freight load. Independent contracting has several coveted advantages. As an independent contractor, drivers get to choose and finance their own semi truck or commercial vehicle. Owner operators are also posited for tax advantages and get to be their own boss. This means choosing your own hours, choosing your own holidays, and potentially building your own business.

Driving as an independent contractor has higher earning potential that employment as a company driver, but that doesn’t always ensure it will deliver that potential. The arrangement between owner operator and businesses should be mutually beneficial because companies can shell out less for labor while drivers take a percentage for their work. Independent contractors can cost companies up to 20% less than other employees according to CNBC. Trouble arises when it’s unclear if a driver is properly categorized as an independent contractor. Were Dominic Oliveira an employee of the company rather than an independent contractor, he would be owed compensation for any miles or hours spent driving.

This widely publicized case holds companies accountable for dodging lawsuits. According to the National Employment Law Project, the risk in these cases is that companies will lean on the Federal Arbitration Act to sidestep responsibility for underpaying workers. While it’s true that some trucking companies offer higher wages, bonuses and benefits to incentivize workers to sign up amongst a driver shortage, this isn’t universal. This case could be a breakthrough for American commercial vehicle drivers by forcing higher wages. This debate isn’t new, either: Fedex, Uber, and Amazon have all been in the hot seat for independent contractor related misclassification.

Higher Wages Mean Higher Prices for Consumers 

Thanks to external concerns like capacity shortage and a looming trade war, some experts are concerned about the effect of this supreme court decision on consumer prices. According to CNBC, consumers could wind up seeing an increase in prices between 10 and 20 percent. This could have lasting effects on the commercial transportation industry and semi truck drivers everywhere.

Case Outcome 

Oliveira’s case rested on the claim that his job, schedule and responsibilities were dictated by New Prime just as any other company employee. This would defeat the purpose and entire benefit associated with working as an owner-operator. Some state reforms have taken on this debacle, and the federal department of labor is intended to prevent unfair treatment of workers. Incorrect worker classification even impacts the government’s revenue due to taxes, workers compensation funds and unemployment insurance. Ultimately, the district called for further investigation to determine if Oliveira should rightfully be classified an employee or an independent contractor.

Positives On the Horizon For Truckers

Ultimately, pursuing your CDL and managing your own LLC as an owner operator is an empowering and lucrative opportunity. Cases like New Prime vs. Oliveira encourage companies to value the needs and rights of their employees. This case could be a turning point for semi truck owner operators everywhere by driving wages. New Prime vs. Oliveira has the potential to strengthen the integrity of the bond between commercial vehicle drivers and trucking companies. To learn more your options for financing your commercial vehicle directly or through a dealership, visit https://www.missionfinancialservices.net today.