Roemer Report – May 2007

CONSTRUCTION AHEAD: For truckers, the first sign of spring is not an American robin, but an orange barrel. Now that the weather is warming up, construction crews are out working on the nation’s highways, and states are warning drivers to slow down and pay attention. Every year, more than 1,000 fatalities occur in highway work zones—all of which are preventable. The top causes for accidents in work zones include speeding, following too closely, and driver inattention. States are doing what they can to raise awareness among motorists about the dangers of highway work zones. Steep fines are one way to grab their attention. The state of Oklahoma fines drivers who speed in work zones anywhere from $200 to $590, depending on the speed. Illinois is even tougher; first-time offenders are fined $375, and second-time offenders face a $1,000 fine and the suspension of their license for 90 days. In addition, Illinois has begun using photo enforcement vans that take pictures of speeding vehicles. The marked vans are equipped with the latest in photo radar technology so they can snap pictures of offending vehicles while recording the speed and the license plate. The Ohio DOT (ODOT) plans to have additional law enforcement in construction zones this year. Stephanie Filson of ODOT wants drivers to be especially mindful of flaggers who are standing in the line of traffic and that construction zones can be very mobile. “It’s important to know the work zone you traveled through yesterday could have shifted” by the next day, she said.

WORLD TENSIONS CAUSE JUMP IN FUEL PRICES: The high fuel prices, which began in February, could last through next year due to international tensions in oil-producing regions, according to the U.S. Energy Information Administration (EIA). In addition to world tensions, other factors resulting in high fuel prices include tight domestic supplies, a cutback in OPEC production, and seasonal demands. The price of diesel per gallon was about 18 cents higher this April than it was last April. “Any real or potential disturbance to petroleum demand or supplies such as unusual weather, unscheduled refinery disruptions, or geopolitical uncertainty in oil-exporting regions can all result in large price increases in a short period of time,” according to the EIA. Officials predict that domestic crude oil prices will be about $65 per barrel this summer. Prices have fluctuated greatly this year already, with a high of $66 per barrel in March and a low of $50.51 in January. Meanwhile, the switch at refineries from low-sulfur diesel to ultra-low sulfur diesel  (ULSD) has also affected fuel prices. This is the first year ULSD has been widely available for trucks. The fuel makes up 60 percent of all on-highway diesel, whereas it was less than 1 percent last year.

EPA’S STAMP OF APPROVAL: Many truck and trailer makers are now offering 2007 models that are certified by the Environmental Protection Agency’s SmartWay program. Certified trucks and trailers have special features intended to reduce greenhouse-gas emissions and air pollutants. Each certified truck can produce savings from 2,000 to 4,000 gallons of diesel fuel per year, resulting in as much as $11,360 in annual savings. SmartWay-approved features on trucks or engines include: integrated cab-high roof fairings; tractor-mounted side fairing gap reducers; tractor fuel-tank side fairings; aerodynamic bumper and mirrors; options for reducing periods of extended engine idling (auxiliary power units, generator sets, direct fired heaters, battery powered HVAC system, and automatic engine start/stop system); and options for low-rolling resistance tires (single or dual). SmartWay features for trailers include: side skirts; weight-saving technologies; gap reducer on the front or trailer tails (either extenders or boat tails); and options for low-rolling resistance tires (single wide or dual). Participants in the program include Freightliner, International, Kenworth, Mack, Peterbilt, and Volvo. The SmartWay Transport Partnership was developed by EPA and the freight industry to reduce greenhouse gases and air pollution and to promote cleaner, more efficient ground freight transportation. For more information about joining the SmartWay program, go to www.epa.gov/smartway.

AN OFFER THEY CAN’T REFUSE: In the battle for market share, LTL carriers have begun offering guaranteed delivery times at little or no extra cost to shippers. UPS, which guarantees all its deliveries, may offer the same guarantee with UPS Freight, its LTL subsidiary. Currently, shippers using UPS Freight pay extra to guarantee delivery within a certain window of time. According to Traffic World, UPS Freight may decide to drop the fee and guarantee all its shipments free of charge. If the company fails to deliver on time, it won’t charge for the shipment. “When you’re confident in your product, it steers you towards considering those things,” said the UPS Freight chief operating officer. And confidence is exactly what LTL companies hope to win from their customers. YRC Worldwide, the largest LTL carrier in the country, offers a 100 percent customer satisfaction guarantee to distinguish itself from the competition. Another company, based in Toronto, began offering an unconditional money-back guarantee, which helped it gain business last year as other LTLs struggled in the slow economy; Vitran increased its profit to $28 million in 2006, compared to $24.5 million the previous year. Experts believe that trucking companies that can add market share by sustaining high levels of customer service will be able to better compete when demand begins to grow again.

HIGH-TECH SAFETY: Although highway traffic fatalities have shown a definite downward trend, since the 1990s, they’ve leveled off, according to the chairman of the National Transportation Safety Board. In a recent speech at Northwestern University, Mark V. Rosenker said the country has “reached some practical limits in combating the physical forces involved in crashes.”  He suggested it’s time to move beyond current methods of crash prevention and adopt more high-tech methods like these:  (1) Crash avoidance technology. Much progress has already been made in this area, with systems that affect stability, rollovers, lane departures, and rear-end/forward collisions. Rosenker says it’s not enough to protect people in crashes; we must use technology to prevent crashes in the first place. (2) Telematics. This term refers to services that combine wireless communication with GPS tracking. Telematics is rapidly evolving to provide safety services as well as onboard navigation and entertainment. Safety systems can be used to summon help after an accident or breakdown, provide weather conditions for specific locations, and notify drivers of road closures and work zones. (3) Command and control. The U.S. DOT is working with industry to build and test crash warning systems to prevent rear-end, lane change, and roadway departure collisions. Vehicle control systems could also prevent intersection collisions and a vehicle from backing up over a person. These systems are expected to eventually be on all vehicles.

WORKERS VALUE HEALTH BENEFITS MOST: Of all the employee benefits, health care coverage is the most important to most employees, according to a recent survey. The survey, released by National Business Group on Health (NBGH), found that 83 percent of workers would rather have their salary cut or their retirement benefits slashed rather than lose any of their health benefits. In addition, 75 percent of those polled said they would rather receive their health benefits through their employer than earn a higher salary to offset the cost of buying health coverage on their own. “The fact that so many employees are opposed to giving up any aspect of their health benefits, even in return for an improvement in other benefits, speaks volumes as to just how important they are from a work and employer perspective,” said Helen Darling, NBGH president. Since the NBGH has been performing the survey, this is the highest level of value workers have placed on their health benefits, according to Darling. With health care costs rising at an annual 7.5 percent—double the rate of inflation—it’s no wonder.

TIPS FOR SETTING GOALS: The late author Maxwell Maltz once said, “We find no real satisfaction or happiness in life without obstacles to conquer and goals to achieve.” Setting goals and working toward them helps people separate what’s important in their lives from what’s irrelevant. It gives people something to work toward and boosts self-esteem. Since there’s no time like the present, why not sit down and decide what you want to accomplish in the next week, month, and year? These tips will help: (1) Do it for yourself. Set goals that you are personally passionate about, not goals that your spouse, boss, or friends think you should achieve. (2) Be realistic. If your goals are too lofty or challenging, you will give up before you even start. Make them doable and realistic. (3) Mix it up. Include easy goals and more challenging goals on your list, and short-term and long-term goals. Achieving the easy and short-term goals will build good habits and reward you with quick gratification. (4) Be specific. Which goal packs more punch? “To improve my computer skills” or “to take a class on QuarkXPress by May 31, 2007.” (5) Reward your successes. Usually, reaching the goal is reward enough, but for those goals that require extra motivation and determination, attach a reward to its completion. The thought of that reward can motivate you to continue when the going gets tough.

 

Courage is very important. Like a muscle, it is strengthened by use.—Ruth Gordon, actress