We are excited to usher in a new year. It may sound crazy, but we’re looking forward to another year of changes and challenges as those are things that make logistics fun.
One notable change for 2014: A significant California Air Resources Board (CARB) drayage truck retirement deadline went into effective January 1, 2014. In order to serve any of the ocean and rail terminals in the state, one must be driving a model-year engine 2007 or newer truck.
One notable challenge for 2014: The contract between the International Longshore and Warehouse Union (ILWU) and the employer group, Pacific Maritime Association (PMA), expires on June 30, 2014. It is expected jurisdiction will be a key factor in the discussions. The ILWU sees every job performed at the marine terminals as a job belonging to the ILWU. We have seen several battles over the jurisdiction of jobs on both coasts over the past year which have resulted in work stoppages and legal action.
We have been saying for months, even years, the key to making CARB compliant trucks affordable to drivers is increased pay AND increased turns/productivity at the marine terminals. Unfortunately, most terminal operators in Oakland just put the kibosh on productivity by shutting down transactions at 2:30 in the afternoon.
TraPac has announced they may not, or maybe they will, release import loads after 2:30 in the afternoon. Ports America is a moving target daily and generally disallows pick ups about the same time, 2:30pm. SSA has posted a dual transaction cut-off of 2:45pm and a single transaction cut-off of 3:15pm.
Two terminals, Ben E Nutter and Howard (Evergreen and Matson respectively) remain open for all transactions until at least 4:15.
We understand the terminal operators’ constraints. They are trying to manage costs and reduce overtime. The increased volumes through their terminals result in high traffic and congestion. In an effort to process the drivers by the ILWU quitting time, they cease transactions and thus the inflow of drivers and containers early in the day.
However, the rest of the logistics community has constraints as well. Drivers are trying to make two loops between the Central Valley and Oakland. Drivers leave the yard about 5:00am in order to be in Oakland before the terminals open. They make their first terminal transaction and return the Central Valley between 10:00am-1:00pm, maybe later depending upon transaction times and traffic. If a driver arrives in the Central Valley mid-day, his is unable to return to the Bay and be processed into the terminal gates by the 2:30pm cut-offs.
The two-loop model is critical for the industry and ourselves. Our drivers rely on it to support their families and our customers rely on it to support their businesses. Closing at 2:30 effectively makes two turns impossible.
Since the California Air Resources Board (CARB) first announced its truck retirement schedule back in 2007, we have been hard at work ensuring our compliance with each January’s deadline. Back in 2010, when the first deadline clicked by, Devine Intermodal had a fleet of new trucks on the road. Since then, we have replaced a handful of trucks every year to comply with the requirements. 2014 is no exception. We brought on-line a couple dozen brand new trucks with the latest in clean air technology. Aren’t they beautiful!
California just finished the driest year on record. So dry, that Death Valley got more rain (2.17”) than the agricultural regions of Paso Robles (1.92”) and Hanford (1.99”). After two straight years of dry weather, California’s reservoirs are below 40% of capacity with Folsom Lake in the Sacramento area being only 19% of capacity. Unfortunately, 2014 is not shaping up well either. There is a stubbornly strong atmospheric high-pressure system sitting over the eastern north Pacific Ocean, which is diverting the jet stream, and storm track, north into Canada. Without wet weather during our rain and snow season of November – March, the draught will have a significant impact on the state’s agricultural growers. It won’t just affect California…more than half of the nation’s fruits, vegetables and nuts are grown in California.
Read more about the draught and its affect on agriculture here.
Bye-bye PG&E! We just finished installing solar panels on the roof of our West Sacramento office. By all accounts, the power generated from these panels will be enough to fuel our offices and shop. Heck, we may even be able to sell some back to the power company, PG&E.
With the aging and dilapidated highway network, congress is looking for ways to fund the necessary improvements. One such revenue stream is the federal fuel tax. A bill proposed by US Rep. Earl Blumenauer (D-OR) would increase the gasoline and diesel fuel tax by $.15/gallon, from $.184 to $.334, over the next three years. The last time the federal fuel tax was increased was back in 1993. Twenty years of inflation and decreased consumption as a result of improved fuel economies have negatively affected the funds available in the Highway Trust Fund.
Rep. Blumenauer then went on to re-introduce legislation to study how the government can practically employ a tax on the number of miles driven.
We sincerely appreciate the support and camaraderie of our customers and colleagues this past year, and we wish you all a happy, healthy and prosperous New Year!
Warehouse Education & Research Council (WERC) will be conducting a tour of JoAnn Fabrics’ DC in Visalia, CA on Thursday, January 23rd. Click here for more information and registration
Save the Date: Women in Logistics (WIL) will hold its annual, free, “resolution-busting” Networking Event on Thursday, January 30th. Details and venue to be announced soon on the WIL website. Stay tuned.
You have heard it here before…”If you bought it, a truck brought it.” That saying remains as true as ever. According to the Commodity Flow Survey performed by the federal government once every five years, trucks still carry the vast majority of goods. 73.7% of goods move by truck. The survey also showed that as intermodal moves grow, trucking is becoming more regional with nearly 85% of the trips being less than 500 miles.
Amazon.com’s plans to pursue the use of drones to deliver packages have been well covered in the media, but did you know Nevada was selected as a test site? The vast and clear skies, the 320 days of clear weather and the research partnerships with the University of Nevada, Reno and the University of Nevada, Las Vegas make Nevada an attractive place for testing.
Do you know what this part is? It is something used in intermodal or truck transportation. Play “Name That Part” by liking us on Facebook. Click here to go to our Facebook page and place your guess. Bonus points if you know what’s wrong with it. Good luck!
The most misspelled word of 2013…drumroll please…furlough. Or is that furlow? Furlo? Ferlow? To set the record straight, it’s furlough.
At the top 2013’s list of most overused words in business were “content,” “social media” and “sustainability.” For the full list of the offenders, click here. Your homework assignment is to see how many of them you can use in one sentence. Have fun!