The Trump Administration is in rapid-fire mode. For our industry, it is a mixed bag.
On the plus side, we have changes at the Environmental Protection Agency (EPA) and a push by the Administration to have Congress review the EPA’s Phase 3 Greenhouse Gas (GHG3) emission regulations and the timeline to adopt zero emission trucks (ZEV) as well as review California’s ability to implement standards more stringent than the US government’s. There is now legislation at the US Capitol, Transportation Freedom Act, aiming to do just that.
There is also the Fair SHARE Act, which would ensure electric vehicles (ZEV) pay into the Highway Trust Fund (HTF). The HTF is currently funded by fuel taxes and is used build and maintain the nation’s roadways and bridges. Since ZEV’s do not purchase fuel, they are also not paying taxes, despite weighing considerably more than their diesel and gas-powered counterparts. This bill intends to level the playing field for the long-term health of the HTF.
On the negative side, we have Tariffs, which will increase the price of goods transiting by land and by sea. With many countries looking at retaliatory tariffs on US products, this landscape will make it difficult for US agricultural products to compete in the world market.
The proposed $1M tax on Chinese-built ships for each US port of call will also have a negative impact on the industry. Should this tax be implemented, the cost for imports and exports will increase $450-$1,000/container. Additionally, cargo owners will have fewer choices as ocean carriers consolidate ports of call, leading to more terminal/port congestion and increased transportation costs.
We have our fingers crossed tariffs and taxes are a negotiation strategy and what actually comes to fruition will be helpful rather than harmful.