MotorTruck March-April 2009 by Annex Business Media

Moto Mo oto o tort rtruck tru uck

MARCH/APRIL

2009

Fleet Executive C A N A D A ’ S

B U S I N E S S

M A G A Z I N E

F O R

F L E E T

O W N E R S

CrunchTime How To Squeeze The Most Out Of Your Purchasing Power During Tough Times

GREEN TRUCKING SCR vs EGR: The debate heats up EQUIPMENT The latest releases from the Mid-America Trucking Show PROFITABILITY Why LTL carriers are moving to an “asset-light” real estate model

contents March/April 2009

Volume 78, No. 2

COVER STORY

CrunchTime How To Squeeze The Most Out Of Your Purchasing Power During Tough Times . . . . . . . . . . . . .

FEATURES

ALTERNATIVES TO WSIB How different insurance contracts can impact company profitability.

EXECUTIVE INTERVIEW MSM’s Robert Murray on the need for better perspective about transborder trade and the industry’s fortunes.

LIGHTEN UP Why LTL carriers are moving to an “asset-light” real estate mode.

SCR V S . EGR The debate heats up between engine manufacturers at the Mid-America Truck Show.

FRENCH FRIES AND FREIGHT Biodiesel may be better for the environment, but there are maintenance needs to consider.

MYTHS AND NUTS Detroit Diesel attacks SCR “myths,” while Navistar comes out swinging with its “truly nutty” SCR alternative.

BEWARE OF UFOS How to spec’ your cab for safety and protect yourself from Unrestrained Flying Objects.

SAFE TECH, SAFE TRIPS New technologies promise to have a big impact on vehicle safety.

page 32

DEPARTMENTS VIEWPOINT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Think border backups have been solved? Think again. COMPETITION WATCH . . . . . . . . . . . . . . . . . . . . . . 8 Reimer Express Lines and Yellow Canada merge to become YRC Reimer; Calyx Transportation Group picks up a trio of transportation and logistics firms; eight Canadian trucking companies make the TCA’s top 20 list of “Best Fleets to Drive For;” and more.. MY HR SPACE . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Planning and communication will help manage constant change in the workplace. TAKING CARE OF BUSINESS . . . . . . . . . . . . . . . . . 12 Microchip implantation in transportation workers is feasible and the benefits are many – but is it desirable? EQUIPMENT WATCH . . . . . . . . . . . . . . . . . . . . . . . 14 Our Mid-America Special: includes updates from major engine manufacturers on enhanced cruise systems and EPA2010 readiness, plus a special edition Harley-Davidson rig from Navistar, and much more. INSIDE THE NUMBERS . . . . . . . . . . . . . . . . . . . . . 38 How will export volumes drop in 2009? Plus, motor carrier predictions on fuel surcharge direction and what percentage of shippers will be looking for rate increases this year.

MARCH/APRIL 2009

Motortruck

Fleet Executive

is written and published for owners, managers and maintenance supervisors of those companies that operate, sell and service trucks, truck trailers and transit buses.

Viewpoint

MARCH/APRIL 2009

VOL. 78

NO. 2

Editorial Director Lou Smyrlis (416) 510-6881

Think border backups have been solved? Think again.

lou@TransportationMedia.ca Managing Editor Adam Ledlow (416) 510-6890

adam@TransportationMedia.ca Features Editor Julia Kuzeljevich (416) 510-6880

he border is not making the headlines it used to a few years ago when transborder trade was booming and long lineups were the norm. But this is one trade and transportation issue that is far from solved and one we dare not place on the backburner, despite how things appear on the surface. The reality is there are some funny things going on at the border. For example, any carrier involved in hauling transborder freight, like Lou Smyrlis, MCILT Robert Murray of MSM Editor Transportation whom lou@transportationmedia.ca I interviewed as part of our annual Award WORTH REPEATING Winning Suppliers “We are seeing companies special for our sister behaving completely differently from the values they used to publication Canadian espouse. They are acting like it’s Transportation & the end of time and not a point Logistics, will tell you in time.” the transborder business has been on the – Dan Einwechter decline since about the President Challenger Motor Freight fourth quarter of 2006. Yet the statistics don’t bear that out. The rising value of energy exports from Western Canada for much of 2007 and 2008 served to mask the consistently declining volumes of exports from the manufacturing sector in Central Canada. While to many politicians an export is an export, the reality for carriers, and those based in Central Canada in particular, is that the demise of manufacturing exports is a serious issue that requires addressing. The other mirage at the border is that more than eight years after 9/11 and the myriad of security programs that were spawned, it is actually getting easier to cross it. Certainly the extended border delays that frazzled the nerves of transborder truckers for years have eased. But, as the Canadian Trucking Alliance (CTA) pointed out when it recently appeared before the House of Commons Standing Committee on International Trade, this should not be taken as any indication that all is now running smoothly. All it shows is a temporary reprieve caused by the drop in truck traffic crossing the border. The problems that have thickened the border in recent years – inconsistency between US and Canadian regulations,

julia@TransportationMedia.ca

border guard staffing issues and inadequate infrastructure – have not been solved. In fact, CTA argues that despite the drastic drop-off in volumes, border processing times have barely changed at all. When the North American economy eventually recovers, the problems that plagued carriers and their exporter customers will quickly rise to the surface and will do so at a time when we can least afford any obstacles to what may prove to be a fragile recovery for our beleaguered manufacturing sector. Why has there been so little improvement during this time? The CTA argues that the Canadian approach of the past few years has been too diffuse, and at times this has impaired the country’s effectiveness in dealing with the US government. There are just too many federal departments with some stake or responsibility for some aspect of the border. The CTA is a professional lobby group, and an effective one by my experience, yet it admits when it comes to border issues it finds it a challenge just to figure out who’s who and how to get the different people working together. To that I would add the usual government inability to move as fast on key issues as business demands dictate that it should. And things could have been worse if legislation considered by our government was adopted. The Canadian Border Services Agency was proposing to turn back trucks if the importer data had not yet been received before the truck arrived at the border. Fortunately, the government changed its mind after vociferous complaints from the CTA and others. The CTA argues that perhaps the brightest period over the past eight years for advancing border issues arose out of the Smart Border Accord back in 2001when governments on both sides of the border decided to act together and at the same time. Perhaps what’s needed is a Smart Border Accord 2009, CTA argues. At the very least, we should also be looking in the mirror, making sure that as Canada rolls out measures such as an electronic truck manifest that we harmonize, to the extent possible, with the US, and that we don’t impose new requirements that will complicate, rather than simplify, the border crossing process. I believe CTA’s recommendation to create a cabinet committee on the border and/or a specific ministerial or senior bureaucratic position with authority for all aspects of the border is a sound one MT and deserves consideration. @ARTICLECATEGORY:129;

4 MOTORTRUCK

Creative Director Mary Peligra

mpeligra@bizinfogroup.ca Advertising Creative Directors Carolyn Brimer Beverley Richards

Contributing Editors

Ken Mark James Menzies Ian Putzger John G. Smith Carroll McCormick Harry Rudolfs

Publisher Rob Wilkins (416) 510-5123

National Sales Manager Don Besler (416) 699-6966

Account Manager Brenda Grant (416) 494-3333

Production Manager Kim Collins (416) 510-6779

Circulation Manager Valerie Fraser

Video Production Manager Brad Ling

Research Manager Laura Moffatt

Vice President Publishing Alex Papanou

President Bruce Creighton Head Office 12 Concorde Place, Suite 800 Toronto, Ont. M3C 4J2 Motortruck Fleet Executive is published 6 times a year by BIG Magazines LP, a leading Canadian information company with interests in daily and community newspapers and business-to-business information services. The contents of this publication may not be reproduced or transmitted in any form, either in part or full, including photocopying and recording, without the written consent of the copyright owner. Nor may any part of this publication be stored in a retrieval system of any nature without prior written consent. Motortruck Fleet Executive is indexed by Micromedia Limited. PUBLICATIONS MAIL AGREEMENT 40069240 Return Undeliverable Canadian Addresses to: Circulation Dept. – Motortruck Magazine, Suite 800 – 12 Concorde Place, Toronto, ON M3C 4J2 USPS 016-317. US office of publication, 2424 Niagara Falls Blvd., Niagara Falls, NY. 14304-0357. Periodical Postage Paid at Niagara Falls NY USA. Postmaster send address corrections to: Motortruck, PO Box 1118, Niagara Falls NY 14304. Member Canadian Business Press. Subscription Inquiries – (416) 442–5600. PAP Registration No. 11025 We acknowledge the financial support of the Government of Canada through the Publications Assistance Program towards our mailing costs ISSN Number 0027-2108

Member/Canadian

MailBag

Safety should be for all drivers and vehicles

Dear Auditor General: Regarding the Auditor’s Report on Truck Safety. As a trucker who writes many letters to media and government, and possesses many traffic facts and statistics, I find your unsafe truck report sensational, one-sided, unfair and poorly researched. The Ontario Ministry of Transportation’s annual Road Safety Report clearly states: • tractor-trailers are involved in 2% of all crashes; • tractor-trailers are involved in 6% of all traffic fatalities; • most (72%) of car/large truck crashes are caused by cars; • over 85% of all traffic crashes are due to driver error. Unsafe large trucks cause about 1% of all traffic fatalities – what about the remaining 1%? Truckers also possess the safest driving records. Large trucks also face full annual inspections and repairs. Cars face nil, unless being sold. Unsafe cars and motorist fatigue cause far more fatalities than similarly in large trucks. Many truckers work different areas and different shifts – generally unaware whether truck inspection stations are open or closed. Over recent years truck vehicle safety has improved. The vast majority of traffic congestion, violations, crashes and fatalities are caused by cars, plus cars cause most large truck crashes. Most motorists ignore their vehicle safety, failing to get a mechanic’s full safety check and repairs. Large trucks stand out in traffic, are observed more often, making them subject to unfair or exaggerated criticism. A minority of truckers are unsafe or discourteous. Many motorists are oblivious to their speeding, poor driving and how to properly share roads with trucks. Unmentioned truckers face overly stringent medicals and retesting or bans while motorists face nil, which can endanger the public. I can tolerate photo radar for BOTH cars and trucks. As a trucker and motorist, safety is for all drivers and vehicles. Don Bell

motortruck

Mandate both quantity and quality of biodiesel

Regarding your story “BCTA accuses province of ignoring biodiesel concerns” on trucknews.com, jurisdictions which mandate biodiesel quantity, without mandating biodiesel quality are irresponsible. Biodiesel fuel quality is very important. Biodiesel that meets the new ASTM standards is manufactured and distributed by a BQ9000 certified supplier should be safe to use under some conditions. Unless the quality is regulated, how will anyone know they have received poor quality fuel until they have expensive repair bills? Currently, there is a resolution on the Canadian Chambers of Commerce policy books that asks the Canadian Government to do just that. Please pressure your local chambers of commerce to receive an answer on where the government is regarding the Biodiesel Quality resolution that was unanimously voted on at the 2007 AGM of the Canadian Chambers of Commerce. Bill Waugh

C-TPAT will help reduce clearance times at the border

Regarding your blog “Seeing Straight at the Border” on trucknews.com, I agree with the contents of this article, for the most part. However, the one CBP program that will enhance traffic flow into the USA is C-TPAT. As C-TPAT participants increase in numbers the overall clearance times will be reduced. There is a paradox here in that in these difficult economic times Canadian exporters are reluctant to spend the money on the C-TPAT program. However, successful application and participation in the C-TPAT program has only positive benefits for the Canadian exporter and will eventually improve border crossing times. David Connell, C.I.T.T. President D L Connell Enterprises

Mandate speed limiters to anyone caught speeding

We are an independent trucking company based out of British Columbia. My husband and I both run Ontario highways with the intended speed limit posted according to your laws. To insist that I must alter my truck to make your roads safer, because your OPP cannot stop speeding on your highways from its people, is unfair considering I do not speed. I would like to remind everyone that what is happening in this province in regards to your “speed issues” is not the fault of the truckers, solely. It is a direct result in the speeding of people on your roadways, and lack of police presence on those roadways. I travel these highways and have often been amazed at the way the people from this province drive in it. The complete disregard for the speed limit or basic rules of the road is so plain too see for anyone who is looking, that I am disgusted in the insinuation that it is the truckers who are somehow solely responsible. To have a politician make a law that singles out truck drivers as the sole problem on your roads is ridiculous. Has he driven the highways out here? Or is he a town guy, who only stays on the smaller community roads? Your OPP are the ones who need to be out there enforcing the laws that are already in place for your safety. That is the real issue at hand. Limiters on trucks is not the answer. You want to put limiters on vehicles to make people slow down, then do it to anyone caught speeding. Hand it out with the tickets that they are required to drive with a limiter. Add it to the mandate for the “new” drivers licensing programs that if caught in the first two years, they lose their license. You want to make a real difference and make safety your “top priority,” then do it properly. If limiters is what you want, then put it in every vehicle, not just trucks.

Melanie Green

You depend on Your parts. Your parts depend on delo.®

You put a lot into your truck—including truck trust. You trust that it won’t let you down; that its parts will keep you driving toward your goal. And they will — if you give them the advanced protection of Delo® products. From our premium lubricants formulated with ISOSYN® Technology to our industry-leading extended life coolants and synthetics, Delo helps maximize uptime and gives you the confidence to succeed. Some of the world’s largest fleets and OEMs ISOSYN ® Technology delivers synthetic-like performance and outstanding value.

depend on our Delo family of products with ISOSYN Technology. To learn more about The Delo Performance Advantage,tM visit us at www.deloperformance.com.

Delo Delivers confiDence

CompetitionWatch REIMER EXPRESS LINES and YELLOW CANADA have been merged into a “single market facing brand” to be known as YRC REIMER. Officials say the move will offer Canadian customers advantages due to the integration of the YRC network, such as simplified access to “flexible, efficient solutions.” The company says the name change will not impact the company’s working relationships. A new logo will be phased into operations, but in the meantime company equipment and buildings will continue to maintain current “heritage” brand names. CALYX TRANSPORTATION GROUP, a provider of transportation and logistics services, has acquired TOTALLINE TRANSPORT, KREATIVE CARRIERS TRANSPORTATION AND LOGISTICS SERVICES, and BRANSAM LOGISTICS SERVICES. The three companies will become separate operating subsidiaries of the Calyx Group. Uwe Petroschke will continue in his role as president of the Totalline organization, and Rodi Saarloos will maintain overall responsibility for Kreative and Bransam as president of both companies. Financial details of the acquisitions were not disclosed. Eight of the top 20 fleets recognized through the first ever Best Fleets to Drive For survey are Canadian, according to organizers. The inaugural survey, conducted by the Truckload Carriers Association (TCA) and CarriersEdge, asked company drivers and owner/operators to nominate the best North American carriers to work for. Nominated carriers were evaluated on the range and depth of programs being offered, the effectiveness of those programs across key metrics and the responses of surveyed drivers. The top-ranking Canadian carriers included: CREEKBANK TRANSPORT, Mississauga, Ont; ERB INTERNATIONAL, New Hamburg, Ont.; KINDERSLEY TRANSPORT, Saskatoon, Sask.; LAIDLAW CARRIERS VAN, Guelph, Ont.; MACKINNON TRANSPORT, Guelph, Ont.; SHULIST LOGISTICS, King City, Ont.; TRANSX GROUP, Winnipeg, Man.; and YANKE GROUP, Saskatoon, Sask. Two Canadian transport companies were named winners at the Truckload Carriers Association’s (TCA) 33rd Annual National Fleet Safety Awards. Based on accident frequency per million miles: MACKINNON TRANSPORT of Guelph, Ont. won the “Division IV – 25-49.99 Million Miles” safety award and BISON TRANSPORT of Winnipeg, Man. won the “Division VI – 100+ Million Miles” award. TCA presented the awards at a banquet and awards dinner on March 10. KRISKA HOLDINGS has purchased certain assets of the van division of BMD TRANSPORTATION. BMD is a truckload carrier based in Lansdowne, Ont. which provides domestic and cross-border trucking services for fortune 500 clients. The deal was expected to close Jan. 31. “When deciding to sell my business, my priority was to place my employees and customers in the hands of a quality carrier,” added Bert McMahon, president of BMD Transportation. “I’ve known the Kriska organization for a long time and I’m comforted by the way they treat people and manage their business. My people and customers are in a safe place.” Truckload carrier GLENNCOE TRANSPORT is being shut down, due to the loss of a major customer and slowing demand for trucking services. Glenncoe has been owned by Bison Transport since June 2007. However, the carrier operated separately, serving B.C., Alberta and the US Pacific Northwest. “This was a very difficult decision for us, as approximately 184 people will be affected by this closure,” said Don Coe, president of Glenncoe Transport, in a statement. “The loss of a major piece of business, combined with a lack of demand in the market is further complicated by the larger economic factors affecting most businesses in Canada. These challenges have rendered Glenncoe Transport no longer viable as a business. We have orchestrated an organized wind down of the company, exiting the business with the same high degree of professionalism and responsibility we have become known for.” The closure is slated to take effect May 31.

For daily COMPETITION WATCH news go to www.trucknews.com or subscribe to our bi-weekly e-newsletter.

CORRECTION: Due to a printing error in our Top 100 report, the last company (by alphabetical order), Yanke Group of Companies, was not shown on the list. Yanke has a fleet of 450 tractors, 900 trailers and 350 containers. It operates out of eight terminals. 8

motortruck

What’sOn

In April, TMTV heads back to the truck stop to ask drivers what they think about the new LCV pilot program in Ontario. Plus: Check out our archives, including the grand opening of Armour Transportation’s new Dartmouth, N.S.-based facility, past coverage of our Decisions 2009 roundtable, and a sneak peak of this summer’s Truck News/Chevron golf tournament.

: blogs Come and debate the issues at our Blogs section on trucknews.com

YO U SA I D I T. . . “There could very well be perpetual turmoil in the trucking industry for the next 5-10 years. In other words, that which is at the end of the tunnel may well be blinking like a disco strobe light.”

Trucknews.com is happy to have two new bloggers join its ranks. Kevin Snobel is the general manager at Caravan Logistics and David Benjatschek is president of Lighthouse Marketing and Wowtrucks.com. Look for both Snobel’s and Benjatschek’s insight on transportation issues in the coming weeks and months. Dan Goodwill examines networking as a critical business skill for both good times and bad.

– Robert D. Scheper responding to Lou Smyrlis’s blog, “Due to recent budget cuts...the light at the end of the tunnel has been turned off.”

Motortruck has published a comprehensive guide for transportation, logistics and purchasing professionals, called “Inside the Numbers” – a snapshot of expectations for shipment volumes, rates, surcharges and capacity concerns based on detailed research of shippers operating in several industries. To find out how to order this valuable information, visit: trucknews.com/inside.

web news

Editorial director Lou Smyrlis tackles the issue of transborder trade and changes at the border.

HeadlineNews Get the latest information on trends, new products, mergers and legislation in our Headline News section at: trucknews.com. MARCH/APRIL 2009

the human edge

change up Planning, communication will help manage change in the workplace

hange appears to be the only constant in today’s trucking industry. Equipment continues to evolve with the addition of new engine technology to the pending use of diesel exhaust fluid. Regulators have altered the rules on everything from Hours-of-Service to load securement practices. Shippers introduce new demands at every turn. Today’s economic turmoil has merely compounded that reality. Companies need to explore new ways to adapt and evolve. Fleets that are purchased by another organization may have to adopt different business practices and computer systems. Layoffs can require remaining staff members to assume new duties. While change cannot be avoided, it can still be effectively managed, insists Peter Spratt, a principal at the global consulting firm of ROCG. That proper management begins with a commitment to the planning process. “Organizations need to think not just about how to implement change, but go right back to the purpose of it. Is it change for the sake of change, or change that will produce positive outcomes?” Spratt explains, referring to the introduction of new warehouse procedures as an example. “That planning piece is sometimes minimized because businesses are under pressure to get it done.” For the planning process to be successful, managers also need to take the time to communicate the reason the change is required in the first place – whatever that reason may be. “Don’t do it once. Do it multiple times and using different media,” Spratt says of this commitment. Memos and e-mails may be part of the equation, but they should also be enhanced by faceto-face meetings to explain the situation. The next step is to encourage “respectful” participation in the entire process. “It goes beyond just telling people what changes will happen,” Spratt continues, referring to the need to consult staff about the best ways to implement a new system or business approach. “Don’t bring it to me at the 11th hour and say this is a done deal. I may have a better way of doing it or be able to do it faster or be able to do it less expensively. Why not tap into that wonderful body of knowledge?”

To find a HR Essentials workshop in your region contact:

MOTORTRUCK

Of course, that doesn’t mean employees can simply refuse to change. They need to be informed about who will make the ultimate decision. “But if you want to have meaningful discussions, this can’t be a sell job,” Spratt adds. “Have some discussion. Seek the input. Then clarify the next steps. What’s going to happen? “They’ll also respect you more if you’re transparent and honest right up front and say, ‘Here’s the situation. It’s not a question of if, it’s a question of how.’” A good example of that will occur at the time of regulatory changes. The final step to ensuring a well-managed change is to supply the necessary support, whether it comes in the form of related training programs or reference material. The affected staff members shouldn’t need to search for information that is required to implement the change that is being introduced. Above all, fleets always need to ensure that they are open about sharing the reason for a change – even if it involves bad news. “Don’t hold it back. [The sharing of news] needs to be done with frequency that minimizes the power of the grapevine and minimizes the power of a vacuum. If there’s a void of information, people will fill that void with myth, innuendo and gossip,” Spratt says. The approach can be particularly true at a time of layoffs. Those left behind could feel threatened, frustrated or even guilty that it did not happen to them. (“They’ll also go through an experience of withdrawal because their social networks are being broken up.”) But a full understanding of the situation can help to put minds at ease. “I also advocate communicating if you have nothing to communicate,” he says. “Let’s say you’re waiting on a major contract and uncertain whether you will get the contract. If you don’t know, I would ensure that every Monday or every Friday there is an update. At least it says, ‘They are not hiding anything.’ Otherwise your employees will fill that void with misinformation and they will start to assume the worst.” The Canadian Trucking Human Resources Council (CTHRC) is an incorporated not-for-profit organization that helps attract, train and retain workers for Canada’s trucking industry. For more information, visit www.cthrc.com.

AMTA www.amta.ca

PEI Trucking Sector Council www.peitsc.ca

Ontario Trucking Association www.ontruck.org

Trucking Human Resources Sector Council, Atlantic info@thrsc.com

inside the numbers

LEVELS OF EFFECTIVENESS IN ATTRACTING/RETAINING DRIVERS Very Effective

Somewhat Effective 72%

Well-maintained equipment

53%

Pre/well-organized paperwork

49%

Paid wait times

45%

Clean cabs

21%

Training opp’s

22%

31% 31% 31%

29%

A signing bonus 17%

25%

Fleets employ a series of strategies to attract and retain drivers, according to research conducted for the Canadian Trucking Human Resources Council. Considered most effective is having well-maintained equipment, followed by well-organized paperwork and paid wait times. However, CTHRC warns there is no “silver bullet” that can solve retention challenges. The effectiveness of strategies will vary between new entrants and experienced drivers, as well as from one region to another. To retain drivers, fleets also offer an array of benefits such as life, accident or injury insurance and medical and dental coverage. Almost 40% of fleets surveyed were providing up to four benefits but a fifth of fleets offer no benefits at all.

PERCENTAGE OF COMPANIES BY AMOUNT OF BENEFITS PROVIDED

More than Four 30.6%

None 20.6%

Two to Four 39.3%

One 9.5%

MOST POPULAR BENEFITS OFFERED Life, accident or injury insurance

51.7%

Medical and dental coverage

51.7%

Paid time for training Guaranteed days off

42.7% 36.6%

Performance incentive programs 31.1%

Saskatchewan Trucking Association www.sasktrucking.com

British Columbia Trucking Association www.bctrucking.com

Manitoba Trucking Association www.trucking.mb.ca

Camo-route www.camo-route.com

Or Contact the Canadian Trucking Human Resources Council, info@cthrc.com or 613 244 4800 MARCH/APRIL 2009 11

TakingCareofBusiness

Would you accept a bar code implant? It’s not as farfetched as it sounds. Microchip implantation in transportation workers is feasible and the benefits are many. The question is whether it’s desirable.

espite all of the GPS and related technologies, many transportation operators claim that they are unable to locate their drivers and employees while on the road. Some are calling for a very radical solution. It raises many moral issues. In a perfect world, universal implantation of the microchip radio frequency identification device (RFID) would be activated by a chip reader. It would be tamper-proof, practically undetectable and indestructible, and would be implanted under the skin. What is the big deal? This device, as claimed, would be used only for legitimate, legal and noble purposes. It could make life better for all of us, providing better security and peace of mind for us and our loved ones. It could even save lives and tremendously benefit mankind as a whole. For the transportation industry, it could help keep track of all employees in far away places. However, this is not a perfect world. Bar codes for human beings? Does anyone want to be treated like a human bar code by the authorities? The most serious threat to liberty could be an all-inclusive database mandated by government – a national identification card with biometric identifiers. Such an ID would increase unsolicited surveillance, will blur the distinction between public and private databases, and will undercut a presumptive right to maintain anonymity. The ID would devolve into a general law enforcement tool having nothing to do with response to terrorism. The resulting level of intrusion necessitated by implantation would impinge on our many legal rights. It is plausible that, since the technology has not yet been perfected, we as a society would believe there is no need to address the incipient legal problems until devices are used. Justice Rehnquist adopted this view in a US Supreme Court decision concerning beeper surveillance where the respondent had indicated that if beeper surveillance were constitutional, “Twenty-

four hour surveillance of any citizen of this country will be possible, without judicial knowledge or supervision.” However, because of the very sweeping reductions in personal liberty and privacy that such implantation represents, the legal ramifications need to be explored now. Although the Canadian Charter of Rights and Freedoms and the US Fourth Amendment protects individuals from unreasonable searches and seizures, a national identification system via microchip implants could be achieved in two stages. A system using the technology, although introduced as a voluntary procedure, might be difficult to dislodge despite limitations of individual freedoms because its advantages would be extremely attractive. The positive applications might be said to outweigh the detrimental legal consequences at that time. Therefore, it is not too soon to consider the repercussions that mandatory microchip implantation would have, as a pre-emptive measure. Upon introduction as a voluntary system, the microchip implantation would appear to be palatable. The US Fourth Amendment has been invoked with reference to internal intrusions upon individuals to obtain evidence, which could be used against them. Examples include the withdrawal of blood and bodily searches, which require surgical procedures or other means to extract substances from the body. In US Winston v. Lee (470 U.S. 753 (1985)), a robber was shot during an escape from the scene of an attempted robbery. Shortly thereafter, a man with a gunshot wound was discovered in the vicinity. To confirm that the suspect was connected with that particular robbery, the police wanted to compel surgery to remove the bullet. Because of the complicated and lifethreatening surgery required to remove the bullet, the US Supreme Court ruled that the surgery would be an unreasonable search. English Common Law and the US Fifth Amendment provides, in principle, that no

Mark Borkowski is president of Mercantile Mergers and Acquisitions Corporation. Mercantile is a mid-market M&A advisory firm focused on the sale of privately-owned business. Mark can be contacted at (416) 368-8466 ext. 232 or mark@mercantilema.com.

citizen shall be compelled in any criminal case to be a witness against himself. A US Supreme Court justice once noted that, “[A] person is compelled to be a witness against himself not only when he is compelled to testify, but also when...incriminating evidence is forcibly taken from him by a contrivance of modern science.” To avoid a governmental mandate, citizens may advocate for an outright ban. This drastic measure may also be necessary in a system that is initially voluntary, for it may well be the precursor to a mandate. Short of that, the best way of preventing incipient problems is to protect rights before desensitization. Although use of such a device at first appears farfetched, examination of the existing technology and the potential utility proves that microchip implantation is both possible and, for some purposes, desirable. Beginning with voluntary introduction, Americans and Canadians may be lulled into accepting them. This article thus sounds a warning bell. The time to prevent grievous intrusion into personal privacy by enacting appropriate legislative safeguards is now, rather than mt when it is too late. @ARTICLECATEGORY:3361;

motortruck

MIDAMERICA EquipmentWatch Freightliner announces upgrades, including predictive cruise system Freightliner showcased a new predictive cruise system at the Mid-America Trucking Show that uses GPS to evaluate the upcoming road profile more than a mile in advance and then determines the most fuel-efficient speed for the truck. RunSmart Predictive Cruise is now available on the 72-inch raised roof Freightliner Cascadia with Detroit Diesel DD15 engine. Freightliner says the system, developed with NAVTEQ, will improve fuel mileage in areas with rolling hills. The RunSmart Predictive Cruise system uses GPS technology as well as 3D digital mapping to interpret the geography that lays up to one mile ahead of the truck. It then adjusts the actual speed of the truck for maximum fuel economy, as dictated by the terrain. All the while, the system will remain within 6% of the set cruise speed, Freightliner officials announced. Currently, 200,000 miles of roadway are covered by the system within the continental US. “This is part of our long term vision to improve truck efficiency using GPS and 3D digital map technology,” said Derek Rotz, manager of advanced engineering for Daimler Trucks North America. “RunSmart Predictive Cruise shows what can be achieved through dedication and collaboration to break new ground. We’re proud to be first in this industry to bring predictive technologies to the market.” Freightliner also announced the availability of the Thermo King TriPac APU as a factory-installed option on the Cascadia, Century Class S/T, Columbia and Coronado models with the Detroit Diesel Series 60 or DD15 engines. “Today’s economic climate has customers seeking more ways to save money, and the Thermo King TriPac APU is a proven solution,” said Melissa Clausen, director of 14

motortruck

product marketing for Freightliner Trucks. “Owner/operators and fleets could see a significant savings on total operating costs.” Also at Mid-America, Freightliner introduced a new battery-powered cab comfort system for its Cascadia. The ParkSmart HVAC system is fully-integrated into the truck’s sleeper and eliminates the need for an APU, according to the company. While rolling down the road, ParkSmart uses electrical current generated by the alternator to run the air conditioner and coolant from the engine to run the heater. When the truck is no longer running, the cooling system uses an electrically-driven A/C compressor that runs on four additional batteries located between the frame rails behind the sleeper, according to the company. This can maintain cab cooling for eight to10 hours, officials said. Heating is accomplished through the use of a diesel-fired coolant heater that circulates coolant through the auxiliary heater core and engine, while also offering a block heater. “Driver comfort is very important to all of our customers, so we seek solutions that will enhance the cab environment,” said Freightliner’s Clausen. “ParkSmart’s lowmaintenance and long-lasting cooling and heating capabilities make it an economical option that allows drivers to focus on what’s really important: the road and rest.” Finally, Freightliner announced availability of the Lectronix T7000 Infotainment System as a pre-wire option on the Cascadia. The system combines truck navigation capabilities with voice, video and entertainment features into one system.

Volvo adds to safety offerings with enhanced cruise system Volvo Trucks North America has announced it is complementing its VEST stability system with Volvo Enhanced Cruise (VEC), which will identify objects beside

and ahead of a tractor and help the driver avoid a collision. VEC is another spin-off of Bendix’s new Wingman ACB, also introduced at the MidAmerica Trucking Show. It uses radar to detect vehicles in front of the truck and helps maintain a safe following distance by sounding alarms when a pre-determined distance is compromised. If an accident is imminent, the system will de-throttle the engine and apply the engine brake as well as the service brakes. It will also inform the driver if a further evasive manoeuvre is required. “VEC combines adaptive cruise control with proactive braking to help drivers avoid collisions,” said Frank Bio, product manager, trucks. “Volvo Enhanced Cruise does more than give timely warnings to drivers. It also takes action and gives the driver – and the other highway users – that much more of a safety advantage.” Only about one-third of the truck’s foundation brake capacity is applied by the system itself, leaving the driver in control of the vehicle. If a vehicle in front of the truck picks up its speed after an intervention, VEC will automatically re-establish its original cruise speed. The system is fully-integrated into Volvo’s cruise control system and is automatically turned on when cruise is activated. The default following distance allowance is 2.8 seconds, but Bio noted it can be customized by the fleet. When cruise control is not activated, the system still provides audible

MIDAMERICA EquipmentWatch warnings but doesn’t have the ability to help stop the vehicle. Three versions of VEC are currently available: front only, side only, and frontand-side. The side versions of VEC notify a driver when a vehicle is occupying its rightside blind spot when changing lanes. VEC will be available as an option on Volvo trucks and its list price is about US$2,100, according to Bio.

Mack declares readiness for 2010 Mack Trucks announced at the Mid-America Trucking Show that it has conducted extensive field testing of its EPA2010-compliant engines and is ready for roll-out. Mack’s engines will use selective catalytic reduction (SCR) in 2010, which is performing well with test fleets, according to the company. Mack officials showed videos of customer testimonials during a press luncheon at the show. “Mack is ready for 2010 and we have complete confidence in our SCR technology and its ability to deliver increased fuel economy and lower operational costs for our customers, especially when compared with other approaches to 2010,” said Denny Slagle, Mack president and CEO. “Ultimately, the performance and efficiency debate on technology will be decided on the road. This is where Mack will shine.” Slagle added “We’re well ahead of where we were in 2007.” David McKenna, director of powertrain sales and marketing with Mack, said realworld field testing has shown Mack’s 2010 engines virtually eliminate the need for active regenerations of the diesel particulate filter (DPF). “Since we use SCR to remove NOx from the exhaust downstream from the DPF, we are able to tune the engine to produce better performance and fuel economy, while using the NOx in the exhaust to passively regenerate the DPF,” he explained. “We’re making

simple chemistry work in our favour.” McKenna insisted SCR will deliver a lower cost of ownership when compared to an in-cylinder solution he terms “massive EGR.” He showed spreadsheets that indicated a Class 8 truck with SCR will typically cost nearly $1,100 less to operate versus a comparable truck using only EGR. That’s based on diesel prices of $2.33/gallon and DEF priced at $1.75/gallon, running 100,000 miles and averaging 6 mpg. When bumping diesel prices to $3/gallon and DEF prices to $2.25, the savings totals more than US$1,300 per 100,000 miles, according to McKenna. While Mack Trucks didn’t provide a purchase price for 2010 trucks and engines, Slagle did say it will likely be “in the same ballpark” as Volvo’s recently-announced emissions surcharge of US$9,600.

Warmkessel. When a pre-determined following distance is compromised (the default value is 2.8 seconds), the system alerts the driver and then if necessary it dethrottles the engine, applies the engine brake and if necessary, applies up to 30% of the founda-

Mack to offer adaptive cruise control

tion brakes. The driver still has the ability to fully apply the brakes. When a safe following distance is re-established, the cruise control will automatically return the truck to its previous speed. The system will be available beginning April 1 with production beginning in the third quarter, Mack announced. It will also be available with an optional side sensor that identifies vehicles travelling in the right-side blind spot of a truck.

Mack has announced availability of a new adaptive cruise control (ACC) system that helps drivers maintain a safe following distance and intervenes when necessary by applying the service brakes when a rear-end collision is imminent. The system, developed by Bendix, has been fully-integrated into Mack Trucks and dubbed Mack Road Stability Advantage by Bendix with Adaptive Cruise Control. “Cruise control is a great feature for highway driving, since it can reduce driver fatigue and improve fuel economy,” said Jerry Warmkessel, Mack marketing product manager of highway products. “But traffic conditions can change quickly from slowing vehicles or close cut-ins by other vehicles. Mack RSA with ACC not only alerts the driver when the distance to the vehicle in front changes, it also takes action to maintain a safe following distance at the new speed.” The system uses a radar sensor mounted behind the front bumper to identify moving objects in front of the truck, explained

Navistar unveils new working power under the hood Trucking industry journalists and dealers were given the first taste of a working version of Navistar’s MaxxForce 15-litre engine, the first fruit from the truck maker’s partnership with Caterpillar. The engine will provide Navistar truck buyers with more power than is currently available with the MaxxForce 13 engine. It will be offered with a 435 to 550 hp range. The engine will have a 15.2 litre displacement, a twin turbocharger with intercooling and aftercooling and will sport a direct march/april 2009

MIDAMERICA EquipmentWatch injection fuel system based on Navistar’s MaxxForce technology. There will be plenty of torque for the heavy jobs; peak torque will range from 1,550 to 1,850 lb-ft. “Our competitors said it would take years. Well, here it is,” Navistar’s Jim Hebe said as the 15-litre diesel was shown in a shiny new ProStar and the ignition was turned on at the company’s splashy press conference in Louisville. “We are now the most vertically integrated truck manufacturer in North America.”

The engine will be available for purchase in 2010. Well-known engine maker Caterpillar shocked the industry last year when it announced it would not develop a heavy-duty truck engine that would meet the 2010 emissions standards and that it was exiting the truck market. However, Caterpillar did not completely exit the market. It further shocked the industry when it struck a deal with Navistar to work on producing a severe service truck under the Caterpillar brand as well as collaborating on other “unspecified projects.” The 15-litre engine just unveiled is the first of those “unspecified projects.” The 15-litre MaxxForce engine is a combination of Caterpillar’s C15 engine basic block and architecture with Navistar’s own fuel and emissions systems. And like

Navistar’s other diesel-power offerings, the new 15-litre engine will rely on EGR (exhaust gas recirculation) to meet the 2010 emission standards, rather than SCR (selective catalytic reaction) which all other engine manufacturers are turning to. Navistar also announced that MaxxPower brand components will soon be available on International brand trucks, IC Bus brand school and commercial buses, and Workhorse chassis products. “Delivering fully-integrated products and solutions designed from the outset for our vehicles will help deliver maximum performance and reliability,” said Jack Allen, president of Navistar’s North American Truck Group. These products will be designed and engineered by and for Navistar as original equipment and factory-installed. Fully integrated and designed to work with Navistar truck and bus products, MaxxPower components will be backed by Navistar’s comprehensive distribution network with replacement parts and warranty through the International, IC Bus and Workhorse dealer networks. MaxxPower products will include drivetrain and suspension components and options like auxiliary no-idle solutions. The offerings include the MaxxPower Front Air Suspension and MaxxPower Battery Powered HVAC No-Idle Solution, both available on the International ProStar and LoneStar tractors. Future products will be released throughout the year.

Volvo says ‘so long’ to active DPF re-gens Volvo Trucks North America announced that it will no longer require active diesel particulate filter (DPF) regenerations on its 2010 engines with selective catalytic reduction (SCR). In extensive field testing, engineers have noted highway trucks with Volvo’s 2010 engines and SCR have been able to regenerate passively 100% of the time. That’s signifi-

cant, because active regenerations require a dose of diesel fuel. Ed Saxman, drivetrain product manager with Volvo Trucks North America, said the ability to regenerate the DPF passively each and every time is another compelling reason to embrace SCR in 2010. In vocational applications, Volvo is touting “near zero” active re-gens. It will continue collecting data before declaring it has completely eliminated active regenerations on vocational trucks. “This is a huge development for our customers, since their drivers no longer have to monitor DPF status or worry about managing DPF regenerations – because a Volvo on-highway truck with SCR will not require active regeneration,” said Scott Kress, senior vice-president of sales and marketing. “Volvo’s advanced SCR technology removes a significant source of the trucking industry’s concerns with emission systems. The truck and driver are more productive, the fleet saves fuel and the environment benefits.” Volvo is the first truck maker to lay

MERCANTILE MERGERS & ACQUISITIONS Mercantile Mergers & Acquisitions Corp oration are a midmarket M&A brokerage firm. The company specializes in the purchase and sale of midmarket companies, including the Transportation industry. In addition, the company advises on business valuations, mez zanine, and equity financing, management buyouts, restructuring of debt, family busi ness recapitalization and workouts. Contact (in confidence): Mark Borkowski, President at: (416) 368-8466 ext. 232 or mark@mercantilema.com Mercantile Mergers & Acquisitions Corporation march/april 2009

One tool for the whole job. Where there’s soot, there’s damage – to your engines and your fleet’s bottom line. DURON -E 15W-40 heavy duty engine oil is your one product solution that protects both ’07 and legacy engines from the damage caused by soot. DURON-E surpasses industry standards for engine wear, provides excellent soot dispersing capabilities, reduces oil consumption and delivers exceptional cold start-up performance. One tool. One solution. To deliver Tangible Savings Solutions that keep your fleet running at improved efficiency. TM

Call 1-866-335-3369 for information on how you can save money with DURON-E. E-mail: lubecsr@petro-canada.ca | lubricants.petro-canada.ca

Fight Soot. Save Money. ™Trademark of Petro-Canada LUB2352E (08.07)

MIDAMERICA EquipmentWatch claim to completely eliminating active DPF regenerations. It felt confident in doing so after collecting millions of miles of realworld testing data without a single active regeneration. Saxman explained that NOx plays a vital role in facilitating passive DPF regenerations. Since Volvo is eliminating NOx downstream in the SCR catalyst, it can allow the optimum amount of NOx to leave the engine cylinder, improving DPF regeneration efficiency. Passive regenerations occur o at about 500 F, according to Saxman, while active regenerations occur at significantly higher temperatures and require a burst of fuel.

Navistar partners with legendary motorcycle brand to unveil new special edition rig

takes LoneStar to the next level,” said Dee Kapur, president of Navistar Truck Group. “It’s the perfect combination of LoneStar originality and Harley-Davidson authenticity.” The truck’s headlights are actual authentic headlamps from Harley-Davidson motorcycles and the leather seats feature the same Harley-Davidson Bar and Shield that appear on Harley-Davidson motorcycles. “When the opportunity to work together first came about, we were intrigued about designing a long-haul truck that had the sleek forms and unique shapes that are unique to Harley-Davidson motorcycles,” said Ron Hutchinson, senior vice-president of product development for Harley-Davidson. “The collaboration produced a truck that has the innovation of Navistar with the heart and soul of Harley-Davidson. This truck oozes the freedom and spirit of the open road.” The International LoneStar HarleyDavidson Special Edition is available in a sleeper configuration only. It is currently available for order and will enter production in June. Only 250 units will be produced in 2009. To learn more and experience the interactive 360° product walk-around, go to www.internationaltrucks.com/lonestarhd.

Western Star unveils new configuration, expanded service

It’s darn near impossible to find a trucker who doesn’t have dreams of riding a Harley, and hard-charging Navistar is banking on the good name of the legendary motorcycle brand in unveiling the International LoneStar Harley-Davidson Special Edition. Unveiled at the Mid-America Trucking Show, the truck’s deep black paint and contrasting silver and orange striping is the chrome laden is a definite eye catcher. “The Harley-Davidson Special Edition

Western Star is now offering a 109-inch BBC twin steer version of its 4900 FA which the company says will deliver better off-road maneuverability and handling. The new configuration will be ideal for construction and severe-duty applications such as West Coast mixers and super-dump applications, according to the company. The new version features a three-degree wheel cut improvement over previous designs, Western Star announced at the MidAmerica Trucking Show. “The new 4900 FA configuration option is yet another way Western Star is

working to meet the needs of our vocational customers” said Rich Shearing, senior manager of product strategy for Western Star. “Not only will it allow for better off-road capabilities and a tighter turning radius, the factory installed BBC option is more cost efficient when compared to an aftermarket conversion.” Western Star also introduced a new limited edition ’67 truck at the show. The new limited edition 4900 features a customized Detroit Diesel DD15 engine under the hood and special interior appointments inside, the company announced. Only 100 of these trucks will be built this year, according to Western Star. The DD15 engine will have 560 hp and 1,967 lb.-ft. of torque, which is Detroit Diesel’s most powerful engine currently available. The engine will only be available in this limited edition Western Star truck, according to the company. “We are very excited to honour Western Star’s heritage with this one-of-akind limited edition truck,” said Shearing. “Coupled with the most powerful DD15 engine to date, the Limited Edition 67 will allow Western Star customers to experience the same ruggedness and durability expected of the 4900 with more power and improved performance.” Western Star also announced at the show that it will now offer Western Star ServicePoint-branded repair services through Petro:Lube facilities at Petro Stopping Centers in the US. Select locations will join the network immediately, according to the company, with the remainder of the Petro: Lube locations joining the network through the summer. “Our new partnership with Petro:Lube not only makes minor maintenance more convenient for our customers, it also allows them to make just one stop for truck repairs, safety and comfort,” said Jack Conlan, senior vice-president, service and parts for Daimler Trucks North America. march/april 2009

MIDAMERICA EquipmentWatch Detroit Diesel takes the wraps off DD16 engine Detroit Diesel introduced what it’s dubbing its most powerful and robust engine at the Mid-America Trucking Show. The DD16 will be available in 2010 with Daimler’s BlueTec emissions technology utilizing selective catalytic reduction (SCR), the company announced. The new offering displaces 15.6 litres and will be marketed to owner/operators and companies involved in heavy-haul applications, as well as small fleets. Like the DD15, the new engine will feature turbo compounding, which captures previously wasted exhaust gas energy and converts it to useful power, according to the company. The DD16 will be offered with between 475 and 600 hp with torque ratings ranging from 1,750 to 2,050 lb.-ft. “The DD16 is ideal for small fleets and owner/operators who demand more from their engines than ever available before from Detroit Diesel,” said David Siler, director of marketing for Detroit Diesel. “We’re confident that the DD16 will exceed expectations in even the most extreme applications.” Detroit Diesel says its newest engine will boast a long, flat torque curve peaking at 1,100 RPM to provide excellent pulling power on steep grades. “Extreme environments such as mountains and coal mines can take a major toll on engines,” said Admir Kreso, director of HDEP Engineering for Detroit Diesel. “The DD16 not only excels in these conditions, but in long-haul applications it boasts durability already proven by DD15 engine.” Because of its ability to handle rigorous applications, the en-

gine will be a good fit for Western Star trucks, according to the company. It will offer it in the 4900 Series in March 2010 and the 6900 in July 2010. “The powerful DD16 will provide Western Star customers with yet another engine choice to tackle the most challenging jobs in the most extreme environments,” said Richard Shearing, senior manager of product strategy for Western Star. “Not only does the DD16 feature superior durability that will result in less engine wear-and-tear, it’s backed by Detroit Diesel’s proven engine technology.” Freightliner trucks will be available with the DD16 beginning in March 2010.

Cummins Filtration to have DEF on store shelves early Cummins Filtration has announced its Fleetguard Diesel Exhaust Fluid (DEF) will be available through distributors across North America by Oct. 1, well in advance of the roll-out of 2010 engines with selective catalytic reduction (SCR). “DEF will be widely available through all our Cummins distributor locations by October 1, 2009,” announced Pamela Carter, president of Cummins Distribution. Cummins Filtration has been selling DEF under the label StableGuard Urea since 2003. As of Oct. 1, its DEF will be available at more than 187 Cummins locations in North America as well as through the Cummins Filtration network of more than 20,000 locations, according to the company. Currently, the solution is available in bulk, 330-gallon plastic totes and 275-gallon disposable totes as well as 55-gallon plastic drums. In mid-2009, smaller packages will also be available, the company said. “Customer needs will vary based on consumption, fueling procedures and other factors. Cummins Filtration is committed to offering dependable DEF supply solutions to meet these different customer needs,” said KC Hall, director of diesel exhaust fluid business development. “While some customers will enjoy delivery of DEF product along with their other filtration products, other customers will opt for specific DEF supply arrangements to streamline their business processes. Cummins Filtration is fully committed to increasing DEF availability and knowledge in the marketplace by providing our customers with a full package of products, information and service options.” For full coverage of the Mid-America Truck Show, visit the “MATS 2009” module under Knowledge Centres on trucknews.com.

MOTORTRUCK

What’s inside a Bridgestone radial?

Experts – with REAL Answers

Tires are just the beginning Wherever you are, there’s an experienced Bridgestone representative to help you get the most from your truck tire investment. Ask your dealer or truckstop what else choosing Bridgestone can do for you.

BridgestoneTrucktires.com

Profitability Alternative to WSIB

Impacting Profitability part II By Lina M. Demedeiros

ast issue, we spoke of the variety of contracts in the market purchased as alternatives to Workplace Safety and Insurance Board. This month, we wanted to illustrate how each contract would respond to a common claim to the individual owner/ operator and potential exposure to decreasing profits for the transport company. Case Study #1 45-year-old owner/operator with $200,000 in gross earnings. Client protects his income for $3,000 monthly for both injury and illness. He has jackknifed his tractor-trailer, sustained a back injury (the diagnoses is soft tissue damage), and he finds out that he has degenerative disc disease. Prognosis for recovery is 12 months. Scenario #1 Non-cancellable contract/ guaranteed renewable Since these contracts generally have a 30-day waiting period, the owner/operator absorbs one month of loss of earnings. This contract was fully medically and financially underwritten at time of application. A monthly benefit of $3,000 is paid, with a total payout $33,000 over 11 months. Scenario #2 Cancellable or conditionally renewable. These contracts typically contain limitations on soft tissue. In most instances, the O/O will be paid for a maximum of 60 days as a linehaul driver. The degenerative disc disease will be covered solely under the soft tissue section of this policy and/or the illness portion. Since benefits are payable from the very first day of injury, the total payment is $6,000. Total loss of $30,000 to the owner/operator. Scenario #3 Association plan Like the cancellable or conditionally renewable contract, this contract would respond

22 motortruck

similarly. Degenerative disc disease is a condition that is commonly limited under these contracts. Since degenerative disc disease commonly occurs with repetitive use, this may be deemed to be an illness normally covered under the illness benefit. However, if the contract states clearly it will pay only 60 days, the total payment is $6,000. Total loss to the owner/operator is $30,000. In Scenario #1, clearly, the owner/operator is paid and really has no motivation to collect under the statutory accident benefit of his fleet insurance policy. The total loss represents only one month of earnings, similar to a hold back. He also has no problem collecting on the degenerative disc disease diagnosis. The application was medically underwritten and he had no diagnosis of the condition prior to entering into the contract with the insurer. The condition is covered. In Scenario #2 and #3, clearly, the owner/ operator will consider the statutory accident benefits available under his fleet insurance policy. The transport carrier may have endorsed, recommended or implemented a plan without any professional due diligence exercised at time of enrollment. The company may have mandated an alternative to Workplace Safety and Insurance Board with “injury only” coverage as a minimum requirement of injury only. This would leave the owner/operator with a major problem. Case Study #1a Where an owner/operator is accidentally totally disabled and becomes a paraplegic, each one of these contracts would respond differently. At this time, the terms, conditions and limitations will actually determine your total payout. In Scenario #1, the non-cancellable and guaranteed renewable would pay benefits until age 65. The insurer would attempt to rehabilitate the O/O to reintegrate them back in the work force. No limit is generally

found under rehabilitation. Benefits continue to be paid. Integration with the Canada Pension Plan would be attempted and the difference would be paid by the insurer. In Scenario #2, the cancellable or conditionally renewable contract contains limitations on rehabilitation. Once this benefit is exhausted, they may or may not qualify to continue to receive benefits. They would be completely dependent on the overall response to treatment, definition, terms and conditions within the contract. If they are unfavourable, the owner/operator would consider going against the carriers statutory accident benefits under his fleet insurance. In Scenario #3, the association plan with a total payout “maximum limit” may pay out a lump sum or a lifetime annuity depending on the type of association plan purchased. This, again, is a potential exposure to the owner/ operator and the transport company. While purchasing the cost effective programs may save you 45% money in comparison to Workplace Safety and Insurance Board and more inclusive programs, the cost savings may be illusory. Many times the savings you thought you found are coming out of your own pocket or the under-your-fleet insurance. It certainly pays to talk to your advisor about proper risk management to help increase your profits and avoid any surprises at claim time. Lina M. Demedeiros, principal of LMD Insurance and Wealth Management in Etobicoke, Ont., is a financial advisor, specializing in the group and individual benefits market. Since 1994, Lina has represented some of the largest insurance companies in Canada, delivering innovative concepts to meet individual business owners’ needs ranging from risk management to helping people manage their money.

Profitability LEADERS MSM’s Robert Murray on the need for better perspective about transborder trade and the industry’s fortunes MT: As a carrier that services the US market, how are you finding things at the moment and when do you see things picking up? Murray: We are a bellwether to the health of the Canadian export economy because of the nature of our business and we’ve been watching the US economy slide since the fourth quarter of 2006. Canadian politicians were very slow to recognize how reliant we are on the American market and how much of our growth comes from that. It’s almost like we are afraid to acknowledge how much American trade means to us. More than three-quarters of our trade, by value, is with the US. The next closest trading partner is Great Britain at 3%. Would you gather that with the way the Canadian government was dealing with this crisis? Unfortunately the impact was also hidden in government statistics by the growing value of our resource trade, which made it appear as if transborder trade was remaining stable. MT: How will the economic downturn change the industry? Will the medium and large carriers be hurt as much as many believe the small carriers will? Murray: I think in some regards it will be some of the larger players who will be hurt the most. We are talking about a 25% drop in commerce right now. You get into some of these larger carriers and that’s a large number of trucks not being used. The capacity issue right now is huge. There is much more capacity now than there is demand. And in a demand-driven industry, this is tantamount to crisis. If I have 1,000 trucks and business is down 25%, that means I’ve got 250 trucks not working. Or maybe, which is even worse, the whole fleet is being run at 75% capacity. That’s what people tend to do first, hoping the economic problems will go away. At MSM, we made those tough decisions before they were made for us. We haven’t had any layoffs. We are doing everything we can to rise and fall as a group with our staff but we’ve talked about job sharing should we need to do more. Also, the profitability of many corporations of any size these days has a lot to do with how they invested their cash assets. Some have invested those in some very fancy financial instruments to the extent that their profitability was coming more from their investing than their operations. Their operations are used more as a cash flow generator. Great example of that is the insurance industry taking its premiums and investing them in the stock market. The larger a company is the more susceptible, it seems, it is to using such an approach.

our next seminar is on May 5, 2009 in Mississauga, Ontario featuring Ray Haight and Allison Graham only $65

march/april 2009

Profitability Why LTL carriers are moving to an “asset-light” real estate mode By Dan Goodwill in the first quarter. This follows the closure of 21 terminals at USF Reddaway and six terminals at USF Holland that were announced in February. Other carriers have also reduced their terminal networks. With property values down by an estimated 20%, there are some good deals available.

eclining shipment volumes and freight rates are placing increasing pressure on the “asset-heavy” segment of the freight industry: LTL carriers. To provide next-day and second-day service in a broad geographic area, companies in this sector require an assortment of terminals and trucks. In view of the current state of the North American economy and the weak growth projections for 2010 and 2011, LTL carriers are taking a hard look at their real estate assets as a means of reducing costs. As reported in a recent issue of Traffic World, “Saving money has moved beyond a means of competing to a key to surviving.” There are a number of trends that are emerging. Terminal Closures Two major LTL carriers left the market in 2008. Jevic Transportation had 10 terminals in the Northeast, Midwest, Southeast and Los Angeles, while Alvan Motor Freight had 15 terminals in the Midwest. Mid-States Express, a Midwest LTL carrier closed its doors within the past few weeks. In addition to these LTL terminals becoming available, terminal network realignments and downsizing are affecting the real estate market more than bankruptcies. Not since Consolidated Freightways unloaded 280 terminals after its September 2, 2002 closure have as many quality LTL facilities come up for sale. Con-Way Freight shuttered 40 terminals out of its 303 terminal network that is estimated to save them $30 million. The company plans to sublease 30 terminals it was leasing and sell 10 others. As part of the Yellow Transportation–Roadway Express merger (to become YRC), the combined companies are reducing their terminal network from 704 to 450. Roughly 150 properties are on the open market. This past week, USF Holland, a regional LTL carrier that is part of the YRC network, indicated that they will be closing 11 terminals

motortruck

Becoming “Asset-Light” LTL Carriers A number of carriers are creating an “asset-light” LTL infrastructure. The essence of this model is for carriers to own their large sorting/distribution hubs while leasing terminals in smaller markets. This was the model that FedEx followed in creating FedEx Freight. David Congdon, president of Old Dominion Freight Lines, explains it this way. When a terminal gets beyond 40 doors, “We tend to want to own rather than rent. When you go beyond 40 doors, it means you have a substantial amount of business in a particular area, and you don’t want to be at the whim of a landlord that can jack up rates beyond what’s economically feasible. Or if a landlord says, ‘I want to make a strip mall’ and pulls the rug out from under you, you’re left with customers to serve and nowhere to serve them from.” Congdon also stated that, “We’re looking to the future, so we want at least 40 or 50 doors. And if an 80-door facility comes on the market, while we might not necessarily need that much, it could be the only game in town. We might consider buying with the expectation that we can grow into them.” Steve O’Kane, president of A. Duie Pyle, echoed the same comments. “We want them big, we build them big, and we keep them big. We’ve always subscribed to that theory – we don’t have a small terminal for a small market like Altoona, Pa. Particularly with our focus on next-day delivery, it gives you that critical mass to load directly to all terminals. The whole world is transitioning to bigger rather than small.” Carriers using Sale/Leaseback to Generate Cash/Expand Networks In order to reduce costs, free up cash and move toward a more asset-light model, some carriers are selling off some of their terminals and leasing them back. YRC agreed to sell terminals to Estes Express Lines and lease them back in a transaction with a purchase price of US$122 million. The Feb. 20 announcement includes terminals in its Yellow Transportation national unit as well as LTL terminals in the USF Reddaway and USF Holland networks. This does not include the 32 facilities that it is selling to North American Terminal Networks under a separate leaseback arrangement. Wall Street sees the YRC/Estes purchase/leaseback arrangement as a necessary one for YRC in view of its difficult financial situation and a smart one for Estes. Estes bought some valuable real estate at a discounted price. If YRC decides to downsize further, Estes is in a position to move their employees into the buildings and include them in their own terminal network.

Profitability Sharing Terminals to Reduce Costs This approach is being used on both sides of the Canada/US border. In Canada, the Transforce organization has been doing this for years by placing its Overland Express, Kingsway and Select Daily operations under one roof in selected locations. There are companies such as Maritime-Ontario Freight Lines and H&R sharing space in a building in Canada. In the US, Lakeville Motor Express and Averitt Express, two members of the Reliant Network, are taking the partnership concept one step further. Averitt is providing local pickup and delivery service for Lakeville out of two Chicago facilities, with each company maintaining separate line-haul, sales and customer service functions. Using Agent Terminals and Marketing Alliances In addition to the sale, sale/leaseback and other terminal sharing arrangements, one of the most longstanding methods of going “asset- light” is to use somebody else’s terminal or terminal network. For many Canadian trucking companies in the ’80’s, running linehaul to and from a cartage agent or regional US LTL carrier became common practice. This is still a model of choice for carriers in the 21st century. This model can be extended to cover a group of provinces or states. As an example, for many years, the Armour Group has been a preferred LTL pickup and delivery agent in Atlantic Canada. With 18 LTL terminals scattered throughout the sparsely populated provinces of Prince Edward Island, Newfoundland, New Brunswick and Nova Scotia, Armour has long been a partner carrier for a number of Canadian and US-based companies. As reported above, the Reliant Network consists of four other carriers in addition to Averitt and Lakeville. This allows each carrier to provide extensive coverage of the US while using the real estate assets of its partner carriers. Excess LTL Terminal Capacity Still a Problem While many LTL carriers have parked trucks, cut staff and reduced employee hours, there has not been a significant decline in capacity that would allow for a healthier pricing environment. Nevertheless, some carriers see the current situation as an opportunity to position themselves for future growth. Their real estate

moves are clearly a key component of their long-term strategies. Through various asset leasing and sharing arrangements, there are opportunities for LTL carriers to add new revenue sources and build their businesses without having to make an investment in real estate.

Dan Goodwill, president of Dan Goodwill and Associates, has over 20 years of experience in the logistics and transportation industries in both Canada and the US. He can be reached at dan@dantranscon.com.

Perfect Vancouver • Calgary • Edmonton • Mississauga • Kitchener • Hamilton • Ottawa • Montreal • Drummondville • Quebec City •

With more locations across Canada than any trailer rental company, PTR offers the convenience of service when you want it, where you need it, and how you expect it. Whether supplementing your fleet for a rush order, requiring emergency repairs to an existing trailer, or looking for a creative solution to a difficult storage problem – we can help. Call one of PTR’s 10 locations across Canada and let us show you why we’re the perfect choice for all your trailer needs.

1.800.563.4182 provincialtrailers.com

Provincial Trailer Rentals A Lions Gate Company march/april 2009

GreentoGold

SCR vs. EGR debate heats up B y

t was a rare sight: the CEOs of four major engine manufacturers sitting side-by-side on a panel and nodding in agreement as each of the others spoke. The scene was the SCR for 2010 – CEO Summit, hosted by the FactsAboutSCR.com at the Mid-America Trucking Show. Included on the panel were: Chris Patterson, CEO of Daimler Trucks North America; Per Carlsson, CEO of Volvo Trucks North America; Denny Slagle, CEO of Mack Trucks; and Jim Kelly, president of the engine business for Cummins. They were there to extol the virtues of selective catalytic reduction (SCR), the technology each of their respective companies will employ to meet EPA2010 emissions standards. Noticeably absent was Navistar, which is the lone hold-out remaining in the EGRonly camp. Navistar has been critical of SCR and stands alone in its pursuit of an in-cylinder solution that doesn’t require exhaust aftertreatment. Also on the panel were: Byron Bunker of the EPA; Bill Mulligan of Pilot Travel Centers; Tom O’Brien, TA TravelCenters of America/ Petro Stopping Centers; and Barry Lonsdale of diesel exhaust fluid (DEF) producer, Terra Environmental Technologies. They brushed aside concerns about the availability of DEF – the urea-based essential ingredient required by SCR systems – by promising to have the fluid widely available before Jan. 1. Mulligan said Pilot will be taking delivery of DEF dispensing equipment beginning in the second quarter and will also sell prepackaged quantities at each of its truck stops by December. O’Brien added his truck stop chain will have DEF available at-the-pump and in pre-packaged containers with emergency fills available through the company’s fleet of more than 400 roadside service trucks. SPONSORED BY: 26

motortruck

J a m e s

M e n z i e s

For his part, Terra’s Lonsdale dispelled rumours about the toxic nature of DEF, pointing out it is not considered a hazardous material by the Occupational Safety and Health Administration (OSHA). It was the engine CEOs, however, that had the strongest words about SCR and the alternative in-cylinder solution being developed by Navistar. “It strikes me as I sit here that even though we represent a very significant percentage of the world’s heavy-duty engine and truck production, we must not be very good leaders,” chided Volvo’s Carlsson. “And the thousands of engineers working for us around the globe must not be very bright, because we’ve selected SCR for EPA2010. And according to the sole adopter of massive EGR, we’ve all made the wrong choice.” He urged a packed room to ignore the antiSCR claims of a “regional manufacturer” that’s “making its first entry into the heavy-duty engine business.” Mack’s Slagle pointed out all the engine manufacturers represented on the panel have their own EGR experiences. “We use EGR today. We know it puts additional stress on an engine,” he said. “We know it generates a lot of heat, even at today’s levels. We know it presents challenges when it comes to engine performance and fuel economy. We’re managing all of this extraordinarily well today, but we’ve reached the limit of what can be accomplished with EGR.” Daimler Trucks North America’s Patterson pointed out: “This may be the only time you see the world’s three largest producers of heavy-duty diesel engines in violent agreement about anything.” He suggested focusing on the benefits of SCR, including fuel economy improvements of about 5%. (Each of the engine OEMs repre-

sented cited similar fuel economy gains will be achieved with their versions of SCR). Since Navistar was not invited to participate on the panel, Motortruck Fleet Executive tracked down Tim Shick, director of marketing with Navistar’s engine group for a response. He said Navistar is more confident than ever that it has made the right choice by carving its own path. “The more we get into this, the more confident we are,” he insisted. Navistar will use emissions credits to slowly work its way down to the EPA2010 NOx limit of 0.2 g/bhp-hr, beginning at a level of 0.5 grams on Jan. 1. When asked for an explanation on how Navistar will meet the 0.2 g NOx limit once its emissions credits run out (expected to occur sometime in 2012), Shick said, “If you put enough exhaust gas back into an engine, you can reach just about any level of NOx you want – that’s not the challenge.” He continued: “The challenge at that level is to retain good performance, fuel economy and durability. And the way we ensure that is, every time we take the EGR rate up in the series of steps we’re making to the final 0.2 g emissions engine, we also take the fuel pressure up. We recalibrate to make sure that all those ingredients in the mix are optimized, and so far we’ve seen in the lab and we have trucks on the road today that show it definitely can be done, we are doing it and we will bring it out…the key to it is that high pressure common rail fuel system, that’s the magic ingredient.” Back at the SCR Summit, Slagle urged everyone to do their due diligence when selecting an engine technology for 2010. “Our message to customers is ‘do your homework,’” he suggested. “Become educated about both SCR and massive EGR so that you can make an informed decision.” mt

Shell Lubricants

GreentoGold

French fries and freight Biodiesel may be better for the environment, but there are maintenance needs to consider B y

im McDonald sees plenty of comparisons between biodiesel and the petroleum-based fuel that it is designed to replace. “It works like diesel, pumps like diesel, stays like diesel and more or less acts like diesel,” says the scientist at Auburn University’s Centre for Bioenergy and Bioproducts. With the exception of NOx, the biodiesel offers lower emissions, is biodegradable and is famously “less toxic than salt.” “We’re at an exciting time. We’re moving from strictly fossil fuels into a new era of renewable fuels,” he added during a recent presentation to the Technology and Maintenance Council (TMC). “What are the options? At least in trucking, there aren’t very many.” Of course nothing is perfect. In the right quantities, salt and diesel fuel are both toxic to laboratory rats. The biggest challenges to the trucking industry can emerge because of the varying quality of biodiesel. Different feed stocks can deliver viscosities that harm injectors. Higher boiling points can mean higher concentrations of fuel in the engine oil. The reactive chemical compounds can also transform into acids and engine deposits. “We know we’re going to have more fuel building up in the engine oil,” notes Lilo Hurtado of ExxonMobil Lubricants and Specialties, referring to recent tests on fuel blends that contain between three and 10% biodiesel. “We’re trying to understand is there any impact on the rate at which the oil is going to degrade? “When the stability goes south on us, the other side effect is it’s going to generate more 28

motortruck

J o h n

G .

S m i t h

organic acids,” he adds, noting how they will attack metals such as copper and lead that are used in cam followers, bushings and bearings. New piston deposits can also emerge. They are the types of challenges that make it important to monitor suppliers of the fuel – requesting fuel made from soy and introducing some additional filters on the dispensing equipment. “You need preventive maintenance on your fuel supply that is just as good as the rest of your vehicles,” noted Keith Bechtum of the Donaldson Company, recommending a four-micron filter between the storage tank and the vehicle. The condition of the filters can also be used to identify a number of challenges with the fuel. If the supply is contaminated with water, the filter element will become swollen or frayed. The presence of a fine black sediment will indicate oxidation, and a slimy filter can indicate the presence of microbes. The latter issue has become more of a problem since the introduction of Ultra Low Sulfur Diesel (ULSD). The sulfur, says Bechtum, also acted as a natural biocide. “If the source of the supply was running on the edge … this probably put them over the edge.” The same issues can lead to challenges with fuel filters on the truck. “Generally, all fuel filters used today are compatible with biodiesel blends up to B20,” he says, noting how a fuel/water separator and final fuel filter will meet most needs in fuel that is up to 20% biodiesel. (The plantbased fuel will hold about six times as much water as its petroleum-based counterparts). The vast majority of plugged filters, mean-

while, can be traced to the quality of the fuel rather than cold weather. While the fuel will o o cloud at 13 C and form a gel at 0 C, that can be addressed with fuel heaters. “Making sure they give you a consistent blend of fuel is probably more important than ever,” Bechtum observes, noting how he would hate to use a fuel with high cloud point in the extreme cold. “It’s pretty important to know what your fuel supplier is giving you.” Indeed, a 10-degree spread in the cloud point can make a difference in cold weather. Emerging challenges in an engine that uses biodiesel can be spotted through an oil analysis program. In addition to measuring the fuel dilution on every sample, Hurtado also recommends a gas chromatography to measure biodiesel fuel dilution, especially in equipment that faces severe service or high idling times. But maintenance managers will need to make a special request for this test since some labs will only test fuel dilution once there is a sign of low viscosity. And a measure of the oil’s Total Base Number will help to ensure that any increase in acids can be addressed. “You don’t have to test every truck in the fleet,” Hurtado says. “You just have to make sure you’re taking a representative population.” McDonald suggests that most of the issues will be cleared up as the biodiesel becomes more popular. “We have 75 years or more experience in making petrochemical diesel and optimizing that fuel for the engines we run today,” he says. “We don’t have necessarily all that much experience with biodiesel. But it is coming.” mt

CFMS Established in 1963

CANADIAN FLEET MAINTENANCE SEMINAR Over 45 Years of Service

Join us MAY 25 – 28, 2009 for the 46th CAnAdiAn Fleet MAintenAnCe SeMinAr Doubletree by Hilton – Toronto, Ontario

tuesday, May 26 • New Products for 2009 • “Shop Talk” with the TMC • Fuel Conservation • Counterfeit, Copycat or Brand Names – Do You Really Know What You’re Getting? • Today’s and Tomorrow’s Director of Maintenance

Seminar ScHeDule:

Wednesday, May 27 • Diabetes – Fourth Deadliest Disease on the Planet • LCV (Long Combination Vehicles) • Hands-On Training Sessions

thursday, May 28 • Lubrication Specifications and Oil Analysis • Alternative Climate Control

Seminar HigHligHTS: • 5th Annual CFMS Golf tournament • Volvo “Maintenance Manager Of the Year” Award • Outside truck display • Silent Auction Supporting Ontario Special Olympics • trade Show

To register, call 519.886.6265 or visit us online at www.cfmsonline.com

GreentoGold Navistar comes out swinging about “truly nutty” SCR alternative

peaking before customers, dealers and the media at an exclusive night event at the Mid America Trucking Show, the Canadian market share leader in Class 8 truck sales not only defended its decision to be the only truck maker staying the course in meeting the 2010 emissions with EGR technology, it came out swinging. Dee Kapur, president of Navistar Truck Group, has been a vocal critic of SCR and he didn’t hold back, calling it “the truly nutty” alternative that asks truck buyers to deal with the “toxic agent” of urea. Jack Allen, president of Navistar’s North American Truck Group, outlined the reasoning behind International’s approach, which it calls “advanced EGR.”

Allen said advanced EGR makes it easier for customers. He said SCR technology adds weight and five new components to gain compliance with emissions standards. He added that Navistar’s approach, which relies in part on credits gained earlier when International engine designs exceeded government standards, as the better way to go. “When our competitors complain about those credits, it’s really just sour grapes,” he said. Allen also questioned the environmental and operational impact of having to use urea with the SCR alternative. He said urea is going to prove expensive, using a figure of $35 a gallon. He also repeated claims that urea breaks

down at temperature extremes and “turns into a toxic ammonia gas.” “It begs the question, do you really want to deal with this stuff?” he said. He added that availability of urea may also be a problem, arguing that even if 500 locations initially offer urea across the US, that’s a small portion of the 35,000 diesel locations across the US. Allen characterized International’s decision to stick with EGR rather than switch to SCR technology as forward thinking. “When we look to the future, we are pretty sure it won’t be urea-based,” he said. “What’s going to happen, do you think, to the resale value of all the SCRequipped trucks?” mt

Detroit Diesel attacks SCR “myths”

B y

J o h n

fficials with Detroit Diesel have openly attacked critics of SCR technology – and the use of Diesel Exhaust Fluid to treat vehicle exhaust – suggesting that the claims are little more than “myths.” Presentations made during the spring meeting of the Technology and Maintenance Council were hardly a veiled attack on Navistar, which is insisting that the next round of emission standards should be met by refining the combustion process. While claims have been circulating that DEF becomes toxic at temperatures above 118 Fahrenheit, Detroit Diesel counted that this argument was “extremely exaggerated,” and quoted a report by James Spooner of the Colonial Chemical Company to prove its point. “Urea is a non-hazardous material that does not become toxic at any temperature,” he said. Claims of steep prices for the fluid were also countered. “We can’t predict what prices will be for DEF or even diesel fuel,” admitted Mark Lampert, senior vice-president of sales for Daimler Trucks North America. “(But) DEF prices will not be the problem that one competitor will have you believe.” He also questioned claims that SCR forces fleets to bear the cost 30

motortruck

G .

S m i t h

of compliance when it comes to the new emission standards. New in-cylinder technology and the higher fuel consumption that comes with it will also carry a cost, he said. Detroit Diesel also made a point of stressing that it will meet the coming emission standards with “no credits, no compromises,” in an obvious attack on manufacturers that will need to rely on so-called “emission credits” for specific engines that do not meet the standards as of January. “While sanctioned by the EPA as a bridging step toward 2010 compliance, they actually result in unnecessary levels of higher emissions during the interim – especially when more desirable near-zero emissions levels can be achieved with the use of SCR technology,” said Lampert. o Worries that the new fluid will freeze at 11 F were also countered with the fact that the tanks will be warmed by immersion heaters, while the EPA will allow a truck to operate while the DEF is thawing. Questions about whether the fluid was flammable were discounted, along with a note that it only tended to evaporate when stored in desert conditions beyond its 18-month shelf life. mt

When the going gets tough, the tough get smarter If there was ever a time to find ways to run your business more efficiently, now is the time. So, where do you find accurate information about industry trends and future estimates for shipment volumes, rates and surcharges, so that you can plan your operation accordingly? Where can you find stats that allow you to compare your operation to others, so that you can identify potential problems and opportunities for your own operation? Look no further. Truck News, Truck West and Motortruck have published a comprehensive guide for trucking and transportation professionals, called “Inside the Numbers” – a snapshot

of expectations for shipment volumes, rates, surcharges and capacity concerns based on detailed research of shippers operating in several industries. • What can your trucking operation expect in 2009? • What are the business trends that are changing your industry? • What are the strategies shippers will be using to stay the course in 2009? This timely report will provide you with a wealth of knowledge that you can use to make 2009 your most successful year ever.

To Order go to: www.trucknews.com/inside or call 416-442-2122 or 1-800-668-2374

AVAILABLE NOW!

TMCReport

talk it out Extended warranties forgotten? Repairs taking too long? Better communication may be the answer

John

motortruck

G. Smith

erry Springer’s name was bound to come to mind when the Technology and Maintenance Council (TMC) announced that dealers and fleet maintenance managers would participate in a “talk show” during February’s annual meeting. The well-respected maintenance group has been known to raise pointed questions that can make suppliers squirm in their seats, after all. But after identifying challenges ranging from purchase order procedures to the pricing of services, both sides did find some common ground in the way these issues can be addressed. “It all comes down to communication,” observed moderator Darry W. Stuart of DWS Fleet Management. “The smaller you are, the more important that relationship is.” Members of the panel candidly admitted that the biggest customers tend to be bumped to the front of the line. “If we see you a lot, we’re going to take care of you a lot,” said Daryl Gorup, Rush Enterprises’ senior vice-president of dealer operations. But regardless of the size of their businesses, several fleet representatives suggested that shops are taking advantage of customers who have vehicles that are stranded far from home. Jobs that would normally require six hours of labour suddenly require 12 hours of work. “There is nothing wrong with profit,” said Michele Calbi, vice-president of procurement and shop operations at Swift Transportation, “but there is a definite difference between good profit and bad profit, and bad profit costs trust. Determine from an ethical standpoint whether it’s good profit or bad profit and stop the bad prof-

it,” she said to applause from maintenance managers in the audience. Stuart went a step further, suggesting that fleets can leverage an important power in these situations. “At the end of the day, you have the power of purchase,” he said. “The purchase order does not trigger automatic payment.” “Before you just don’t pay it, the next day just call somebody at least once and say, ‘I’m just trying to be reasonable,’” countered Jim McCullough, president and dealer principal of general truck sales and service in Memphis. “When we get to know each other and have open lines of communication and relationship building, it’s amazing that a lot of these problems get solved.” Fleets and dealerships on the panel even admitted that there may be other explanations for longer repair times. The industry’s standard repair times (SRT) for warranty work will not always reflect real-world situations. In other cases, fleets will likely be able to complete the work more quickly in the confines of a captive shop. “A fleet does have a distinct advantage over us because they are dealing with a consistent number of spec’s,” explained Jack Saum, CEO of Beltway Companies, which operates eight International dealerships in Maryland. Warranty matters may also require extra time because a dealership’s shop will need to follow a specific set of procedures outlined by the original equipment manufacturer. Eaton, for example, requires photos to be taken in the event a rear end fails. Certain diagnostic trees will also need to be followed. Still, Frank Nicholson at Transam Fleet

is frustrated when his road assist department understands a warranty system’s computer screen better than the dealership’s personnel. And he balks at dealers or technicians who try to take on the role of a warranty administrator. “Follow the procedures. Don’t follow what used to be,” he said, noting how he doesn’t want to hear a dismissive, “we know it’s not covered,” from the employees of a shop. while fleets complained about the need for extended warranties to be honoured, the dealerships responded that they need fleets to press suppliers to ensure that everyone knows about the related coverage. “Oftentimes, we don’t even know what extended warranty you do have,” observed Brad Faurve, president of the Velocity Vehicle Group in California. “Push the vendors to have visibility on what warranty is available.” The key solution to all of these issues appeared to involve something as simple as the art of communication. It is why Marvin Psalmond, director of maintenance at Dean Foods, says his fleet personnel actively try to get to know the individual managers within a dealership. And it is why Calbi suggests that dealerships should take the time to understand their customers – from the equipment that is used to the operating hours. It is also important to manage the way the information is delivered. It is better to share details during each step in the job so the data can be entered into fleet computer systems as it arrives, added Nicholson, noting how he will not release a purchase order until a job is reviewed. “If you do an engine repair, how many job steps are in that?” he asked, referring to the data that needs to be entered at the fleet level.“You’re asking an awful lot of the road assist department (if it is all sent at once).” It is the type of dialogue that could help to address the way jobs

are prioritized within a dealership. Some of the dealers on the panel discussed “triage” systems that help to prioritize and expedite repairs as quickly as possible. Others talked about the priority that they give to loaded equipment. Dealerships may also need to reconsider how they “qualify” the drivers, Calbi said. One may have an empty trailer, while another needs to meet the standards of a courier such as FedEx or UPS that requires 99% of loads to be on time. “Being late is just not part of the equation,” she said, noting how lanes will be lost if the on-time commitment is sacrificed. “Ask the driver, ‘Do you have a hot load? Is it empty? Do you have a sensitive or high-value load?’ That may need to be parked in a certain area.” “A lot of times the trucks get lost in the shift change if you’re 24/7, so you have to check our processes and ensure that doesn’t happen,” she added. “I take it a step further. we need a contact even beyond the driver because his sense of urgency may be different from the fleet’s,” says George Pavin, president of the Kriete Group, a Mack dealer in wisconsin. Again, an open line of communication was seen as crucial to the solution. “If it’s going to sit for four days, tell us that. I may decide to take it to another dealer, but that doesn’t mean you’re a bad dealer,” added Doug white, vice-president of maintenance at Dunbar Armored. “I may call you a name on the phone (but) I can’t make that decision if I don’t know the truth.” The timing of such discussions may even be better than ever. “we are very hungry for work,” Faurve says of the current economic environment. “You’re going to find some very willing participants in that conversation.” mt

The Shippers’ Magazine www.ctl.ca Distributed to over 18,000 Shippers across Canada. march/april 2009

TMCReport

Beware the UFOs ( U n re s t ra i n e d F l y i n g O b j e c t s ) Spec’ cabs for safety and tie down the loose gear By

John

G.Smith

ike Jeffress knew that he was staring at a safety problem when he discovered a TV mounted on the floor behind a passenger seat. The driver of the truck in question was obviously trying to watch TV while sitting behind the wheel, suggests the past chairman of the Technology and Maintenance

Council. The urge to watch Too Fast, Too Furious in the middle of a highway can obviously be dangerous to a driver’s well-being, but a quick look inside many cabs can identify a variety of other safety-related threats as well. The secret to a secure environment will begin by securing the gear that can become a projectile at the time of an accident. The nets, doors and tie-down rings fixed to the cabinets in today’s sleepers offer an important measure of security when they are properly used, agrees Tom Palencher, marketing product manager with Volvo Trucks North America. “But if you get something heavy and are only using little tie-down straps, that won’t hold up in an accident. You’re going to need something more than bungee cords.” It is a matter of physics. A 50-lb refrigerator in the sleeper will produce up to 750 lbs of intertial force in a 15 mph crash. At 30 mph, the same refrigerator has four times the potential energy. Objects sitting on bunks and cabinets are also the most dangerous because they will have an unobstructed path to the driver’s head or torso. And loose objects on the floor could easily wedge themselves under the pedals. Granted, the threats are not limited to UFOs (Unrestrained Flying Objects). Truck buyers should look at the material around the bunk itself, Palencher notes. “Is the stuff around there soft enough that it’s not going to cause head injuries?” Cabinets made of soft composite materials will help to limit injuries in the event anyone comes into contact with them. The proper choice and use of inverters can also help to protect against cab fires, adds Bruce Purkey of Purkey’s Electrical Consulting. “These units will pull a lot of current. You must use the circuit very close 34

motortruck

to the battery,” he says, noting how the related fuse should also be located within 10 inches of the power source. The required amperage for that fuse can usually be determined by dividing the inverter’s wattage by 10. (A 1,500-watt inverter, for example, should have a 150-amp fuse). If fuses with excessive amperages are used, the wiring could catch on fire. Cables also need to be sized accordingly. A Number 2 wire, for example, should be used if the inverter is six feet from the battery. There is no size that fits every application, and any unnecessary cable will lead to a voltage drop. When routing the inverter’s wires, it is also best to use a mounting plate with strain relief and the grommets that will protect against chafing. And the inverter itself should be connected to a clean chassis ground. “Drivers don’t realize how much power they take out of the batteries. They have to know what they can use and what’s safe to use,” Purkey adds. Drivers will also need to remember to limit themselves to one device per outlet on the inverter. In addition to that, they also need to realize that there is a distinct difference between a cigarette lighter and a power source. While the openings look the same, the power source has a higher rating and the cigarette lighter is designed for intermittent use. Many other safety-related enhancements can be made when the truck is first purchased. Visibility, for example, can be improved with the addition of a down-view mirror to protect against blind spots. Controls mounted on a steering wheel will help to ensure that eyes remain on the road. And cabinets that run from floor to ceiling will offer a welcome barrier between the driver and any loose objects in the sleeper. Any dashboard should also mount controls within easy reach, but fleets should also be careful about choosing designs that are simply too overwhelming to watch, Palencher adds. Even when wearing restraints, a driver is also going to come in contact with the dashboard during a full frontal accident. That means instrument panels should offer some protection for the knees. Palencher also questioned those who spec’ toggle switches on the dash. “If a driver hits that, it’s going to sort of be like acupuncture,” he says. The impact may even be guaranteed. While those who wear seat belts are twice as likely to survive an accident, a mere 65% of truck drivers use the restraints, says Kevin Tribett, manager of highway safety for Lifeguard technologies. It proves that a commitment to safety involves everything from vehicle spec’s to driver attitudes. mt

)FMQJOH

ZPV Â¾ OE

ZPVS XBZ

5SBOTQPSUBUJPO .BUUFST 8BUDI 0OMJOF 5IVSTEBZT

USVDLOFXT DPN WJEFP

TMCReport

Safe tech, safe trips New technologies promise to have a big impact on vehicle safety By

John

G. Smith

e were obviously turning the corner too fast, but that was the point. Meritor Wabco’s test driver headed into the “ramp” at 33 mph and cranked the wheel. The downrigger attached to the side of the trailer began to tilt towards the pavement like the training wheels on a bike. Once the wheels touched the surface of the runwayturned-test-track, the trailer had obviously passed the point of no return. It was a rollover. The second trip into the curve offered a different experience when the roll stability system was engaged. The equipment automatically measured wheel speeds, lateral acceleration and pressure in the air suspension, and then applied the brakes to bring the trailer under control. The downrigger never made contact with the ground. Technology promises to have an undeniable impact on the safety of trucks that travel North America’s highways. The addition of emerging systems such as Meritor Wabco’s Roll Stability Support, for example, offer added stability for loads with a high centre of gravity. Lane Departure Warning Systems sound their warnings as drivers stray over the painted line. And various sensors can be used to measure following distances. The equipment can also offer a relatively quick payback to the fleets that install it. “There’s very promising data – particularly return

motortruck

on investment data,” says Dan Murray, the American Transportation Research Institute’s vice-president of research. Using some conservative figures, researchers have shown that buyers can certainly recover their costs. Granted, the returns can vary widely depending on the exposure to heavy traffic and the value of insurance deductibles. But a Lane Departure Warning System returns between $1.37 and $6.55 on every dollar invested into the equipment, according to research by the American Transportation Research Institute. Roll Stability Control offers a payback of $1.66 to $9.36. And a Forward Collision Warning System offers a return on investment between $1.33 and $7.22. (All figures are US dollars). These figures consider everything from crash costs to insurance rates and pending changes to safety ratings. There is no question that this equipment can work. Field tests are proving that. But researchers are now trying to determine if they can build a safer truck by integrating several of the equipment options. The major field test of these Integrated Vehicle Based Safety Systems (IVBSS) began this February under the watch of the University of Michigan Transport Research Institute. It is looking at the combination of a Lane Change/Merge System, Forward Crash Warning System and Lane Departure Warning System. It is part of a 54-month, $32.2-million evaluation that is considering systems for light and heavy vehicles alike, with Eaton, International Trucks, Conway and

Battelle included in the truck research. The latest step is a 10-month Field Operational Test that will gather enough data from 10 trucks to simulate eight years on the road. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re familiar with these technologies independent of each other. We never tested them together,â&#x20AC;? says Bob Petrancosta, vicepresident of safety at ConWay Freight. â&#x20AC;&#x153;One of the reasons weâ&#x20AC;&#x2122;ve never tested all three together is, quite frankly, itâ&#x20AC;&#x2122;s cost-prohibitive.â&#x20AC;? In the test vehicles, the Lane Change/ Merge Systems flash a yellow light if there is an obstacle in the truckâ&#x20AC;&#x2122;s blind spot, show a red light if the driver activates the turn signal in that direction, and sound an alarm if a turn begins. A Forward Crash Warning System, meanwhile, displays a warning if the truck is within two seconds of an object, and sounds an alarm if it anticipates a collision. The Lane Departure Warning System sounds the alarm if the vehicle strays over the painted line. Petrancosta saw the value of a Lane Departure Warning System when he watched the videotape of one of Conwayâ&#x20AC;&#x2122;s drivers who was nodding off behind the wheel. The alarm sounded, the driver corrected the steering and there was no other event during the remainder of the trip. A â&#x20AC;&#x153;lot of effortâ&#x20AC;? has gone into eliminating false alarms, adds Dr. Zhijun (Zwick) Tang, an Eaton engineer involved in the product. Thatâ&#x20AC;&#x2122;s why there is no audible alarm when a turn signal is activated before a turn actually begins. Meanwhile, Lane Departure Warning Systems are accounting for various lane markings in construction zones. Some jobs seem like they are earned by drawing a short straw. Consider the Meritor Wabco employee who stood on the brakes of his rental car in front of a moving tractor-trailer. As the distance between the vehicles began to close, the warnings in the cab began to sound. Then the prototype Autonomous Emergency Braking System automatically began to apply the engine brake and foundation brakes. The tractor-trailer came to a safe stop without any intervention by the driver. The systems also continue to be refined. The combination of a video camera and radar on a Forward Crash Warning System, for example, will detect parked vehicles as well as those that change speeds. Donâ&#x20AC;&#x2122;t expect traditional mirrors to disappear any time soon, says Chris Flanigan of the FMCSAâ&#x20AC;&#x2122;s office of analysis, research and technology. But some of the new technology

could still be mandated as well. The National Highway Traffic Safety Administration is already requiring Roll Stability Systems on passenger cars by 2010. There are other signs that the US federal government may offer further financial support for those who want to install the new safety systems on trucks. The real push may come with the introduction of a Bill in the US Congress, which suggested incentives to offset the cost of such equipment. With 23 authors, it is expected to have some traction

in the year to come. Now picture a system that ties stability controls into a GPS unit, muses Alan Korn of Meritor Wabco. If a driver heads into a 30 mph curve at twice that speed, the vehicle will roll over. But imagine a system that identifies the curve before it emerges and begins to slow the vehicle before it even faces the threat. â&#x20AC;&#x153;It seems far-fetched,â&#x20AC;? he says of the future possibilities, â&#x20AC;&#x153;but when you think about it, itâ&#x20AC;&#x2122;s not.â&#x20AC;? mt

6PDOO LQYHVWPHQW ODUJH UHWXUQ 7UDQV&RUH V 6ODS 7UDFNÂ&#x152; 7UDLOHU 7UDFNLQJ Â&#x2021; 2SHQ WKH GRRU WR PRUH IUHLJKW UHYHQXH Â&#x2021; 3URWHFW \RXU DVVHWV Â&#x2021; 5HGXFH \RXU RSHUDWLQJ FRVWV )RU PRUH LQIRUPDWLRQ RQ DQ RSSRUWXQLW\ WR PRYH PRUH IUHLJKW DQG PDNH D EXFN ZLWKRXW EUHDNLQJ WKH EDQN WR GR VR

&DOO ZZZ VL[W\ FD

march/april 2009

9% That’s the World Trade Organization’s forecasted drop in export volumes for 2009, the largest such contraction since the Second World War. Developed countries will be hit hardest with exports falling 10% this year, while developing countries will see volumes shrink from 2% to 3%, according to the WTO. Officials from the WTO said warning signs of this year’s bleak trade assessment were evident in the latter part of 2008 as demand and production both grew sluggish. World trade still managed to grow by 2% in 2008. A slow final six months ensured volumes would be well shy of the 6% increase posted in 2007.

InsidetheNumbers PERCENTAGE OF SHIPPERS EXPECTING RATE INCREASES (excluding surcharges) IN 2009 BY MODE

With the exception of shippers using marine services and, to a lesser extent, those using air freight, more than half of shippers using all other modes are expecting rate increases for 2009. However, given the deteriorating state of the North American economy, it would not be a surprise if a) the percentage of shippers paying higher rates this year was not as high as indicated here, and b) if the magnitude of those increases was considerably muted.

MOTOR CARRIER PERCEPTIONS ABOUT INCREASES IN FUEl SURCHARGES FOR 2009

Answer Options

Response Percent

1% - 2%

27.5%

2.1% - 4%

27.5%

4.1% - 6%

27.5%

6.1% - 8%

5.9%

8.1% - 10%

3.9%

Greater than 10%

7.8%

MOTOR CARRIER PERCEPTIONS ABOUT DIRECTION OF FUEl SURCHARGES IN 2009

Answer Options

Response Percent

Increase

18%

Decrease

38%

Stay the same

44%

After several years of stiff increases in fuel surcharges in the motor carrier sector, only 18% of motor carriers responding to our survey conducted in the late fall were expecting fuel surcharges to continue increasing in 2009. The majority (44%) expected them to stay the same while more than a third (38%) expected them to decline. Of those expecting an increase, the greatest percentage (55%) thought the increase would be below 4%. 38

MOTORTRUCK

Neither rain,

nor sleet, nor snow, nor rising fuel costs.

MICHELIN

Introducing the MICHELIN X One XDN2 —the all-weather, fuel-saving tire. ®

It’s a MICHELIN® XDN2® tire. It’s also a MICHELIN® X One® tire. That means you get one of the best-gripping tires money can buy. With a bold open-shoulder construction, the MICHELIN® X One® XDN2® tire is the premier all-weather drive tire, giving you the same superior traction and confidence you’ve come to expect from the MICHELIN® XDN2® tire. And because it’s a MICHELIN® X One® tire, you can haul more and save fuel while doing it. Upgrade to the MICHELIN® X One® XDN2® tire—better grip and better fuel efficiency in a better tire. Michelin. Improving your bottom line through innovation—that’s a better way forward. Learn more about the new MICHELIN® X One® XDN2® tire and MICHELIN® Durable Technologies at gowidesavegreen.com.

1.7 MILLION DOLLARS HAPPIER THAN HE WAS YESTERDAY.

Uncovering a significant dollar amount that helps improve your bottom line? Now what fleet couldn’t use that? That’s what PeopleNet Professional Services finds on average in ROI per client identified. How? By offering a wide variety of consultation programs to help optimize your fleet’s performance. Plus, it’s all backed by the L/100KM guarantee.* More reasons why PeopleNet customers experience a business edge unlike any other. To experience it for yourself, call 888.346.3486 or visit peoplenetonline.ca. *If in a 12-month period your L/100KM fuel savings does not exceed the entire cost of the program then PeopleNet will refund 100% of the Professional Services fee.

THE PEOPLENET BLU

™

L/100KM SCORECARD

allows drivers to monitor and adjust their performance in real time. So now everyone’s contributing to the bottom line.