FedEx CEO Calls For Industry Leadership On Taxes, Onboard Recorders
It's time to raise the federal fuel tax – maybe even index it to inflation – and to start using onboard recorders to track driver hours of service, says the president of FedEx Freight.
Doug Duncan, who heads the LTL arm of the nation's second-largest truck services company, believes the industry needs to assert itself on matters of highway policy and safety. He sees higher fuel taxes and onboard recorders as steps that have purpose in themselves but also are a means to achieve a broader goal: to take national transportation policy to the next level.
"If we get out ahead we can shape what's going on," Duncan said.
Higher fuel taxes are unavoidable because the country needs to reinvest in its highways, he believes. The mammoth highway reauthorization bill that Congress passed last year won't even cover maintenance of the highway system, much less the expansion that is needed to preserve the efficiency of the nation's logistics system, he said.
"We need better strategic investment" in the system, he said. And the trucking industry must recognize that it will take more investment – which means higher fuel taxes. "We can't sit back and avoid taxes," he said. "It's time to lead."
Duncan's analysis is based on the role he sees trucks play in the national economy. He said trucking has matured from the commodity-type service it used to be into a value-added supplier, providing "fast cycle logistics" in ways that add considerable productivity and efficiency to the market.
Some trucking companies now offer a money-back guarantee on freight shipments, he said. "I would not have believed that possible 10 years ago."
But the lack of investment and planning in the infrastructure make it hard to continue reducing logistics costs, he warned.
Duncan also noted that it may be necessary to index the tax to inflation, an idea aired by House leaders during debate on last year's highway bill but shot down by the Bush administration. He opposes highway tolling as a way to raise revenue: "The current tax system can work."
Another change he supports is reform of truck size and weight restrictions. Duncan shares with a number of industry leaders the view that the ability to carry more freight in a truck will be a key factor in the fight against highway congestion. As Duncan admitted, however, this will not be easy. There is considerable opposition to loosening federal size and weight restrictions, and not just from the railroads and safety advocates. Elements of the trucking industry do not like the idea, either.
Duncan believes the solution to these problems is to bring all elements of the transportation community to the table – trucks, rails, transit, ports, ocean and waterway shipping.
"It can't be done selfishly by mode," he said. "Trucking must be more mindful of other modes."
And, he said, trucking needs to demonstrate its leadership by tackling tough issues, and getting out a message about its achievements in the areas of safety and environmental improvement.
Adoption of electronic onboard recorders is another way to demonstrate leadership, Duncan said. The industry should be a "proactive advocate" rather than sit back and wait for the Federal Motor Carrier Safety Administration to come up with a rule, he said.
The agency has promised that it will propose a rule – which may or may not require recorders – this year. While some elements of the industry remain adamantly opposed to recorders, others view them as an inevitable requirement – the only questions being the details of the rule and when it will take effect.
The American Trucking Associations, of which FedEx Freight is a member, last year announced conditional support for recorders, provided there is proof that they actually improve safety, among other criteria. ATA's research arm, the American Transportation Research Institute, is researching the issue and has asked carriers and suppliers to participate in surveys. For more information, go to www.atri-online.org/survey.
— Oliver B. Patton, Washington Editor
News Continued...
