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Apr 1, 2010 12:00 PM

Jeff McCaig leads association through a tough recession

McCaig: Carriers are nervous. The industry can adjust to whatever the rules are as long as the rules are clear and enforced. If government imposes lower hours of service on the trucking industry and those rules are fairly and uniformly enforced and drivers would make less money than before, then the rates will rise, and that will allow us to continue to attract people with professional driving skills who are in short supply. Uncertainty means rates can't adjust, and that exacerbates the driver shortage.

BT: What will be the economic ramifications of revised hours-of-service regulations that shorten driving hours with regard to driver pay and fleet productivity?

McCaig: The short answer is that the cost of shipping goods will have to go up if the market works as one would expect. Truck driving is one of the few jobs in a modern industrial economy that is still basically done on a piece rate. Pay is sometime hourly, but more often it is based on mileage or a percentage of revenue. If you reduce the number of hours or miles a person can drive, you've reduced his pay.

BT: Going forward, what is the outlook for the North American Free Trade Agreement (NAFTA) with regard to the trucking industry?

McCaig: I think NAFTA makes so much sense that ultimately it will prevail and we will have a relatively integrated economy in North America. We'll see more integration of the Canadian, US, and Mexican economies because it just makes sense and everyone in these three countries will be so much better off.

BT: What are your thoughts on the discussion we hear today about fair trade versus free trade?

McCaig: You have to be careful what they mean by the term “fair trade.” In some cases, it is code for protectionist trade. In others, they really do mean fair trade.

BT: Where do things stand on the US Customs and Border Protection rules relating to empty cargo tanks that cross into the United States from Canada and Mexico?

McCaig: It's not being enforced right now. We believe customs officials understand that they do have to exempt some amount of residue in the trailers. Beyond that, this is an unreasonable requirement that won't do anything to prevent a terrorist incident.

BT: From your North American perspective, where do we need to go with sizes and weights?

McCaig: That is an area where the United States does need to take some forward steps. The US has some of the best highway infrastructure in the world, and it is under-utilized when more productive vehicles (in terms of sizes and weights) are not allowed. The other two countries in North America do allow larger sizes and weights. The United States really is penalizing the productivity of the trucking industry. Larger sizes and weights are more efficient economically, more efficient environmentally, and more efficient in terms of energy use.

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