Carriers & shippers can make deregulation work

By Dale E. Ward President Link Management Corp. Portland, Or.

It wai Nov., 1981, when Ray Baldwin, vice president, Mellow Express, a forest products hauler in Oregon, announced economy measures which were unprecedented at Mellow. Today, those changes are still in effect. Baldwin says, "We're working harder now."

He expects that Mellow will survive deregulation and the recession, but, he adds, "There's a lot of indecision in the industry now. Carriers are trying to decide whether to continue the battle or shut down. "

"Most of us are waiting to see if the new entrants can last," he said in reference to the influx ofnew carriers under deregulation. "We don't think they can."

Carriers are concerned and reactive about their future. The Carrier Preservation Committee (CPC), an organization established by the major rate bureaus to maintain the old ways of collective ratemaking, continues to advocate protectionist legislation.

The trucker controlled rate bureaus have acted as intermediary between carriers and shippers since the industry was regulated in 1935. However, since deregulation, carriers have utilized rate bureaus less and less. The overwhelming number of new independent rate filings has rendered many bureaus incomplete sources of rate information.

Most industry appeals for a regulated system have been advanced before the Motor Carrier Ratemaking Study Commission. The commission has concluded its data gathering on the subject of collective ratemaking, believed to be the last hope for the trucking industry to insulate itself from a competitive market place. Since its inception the commission has conducted seven hearings, heard over 100 witnesses and received written testimony from twice the number heard. The issue: should collective ratemaking immunity for single-line ratemaking be continued beyond its scheduled repeal in January, 1984? The commission will submit its recommendations to Congress in January, 1983.

Larry Darby, commission executive director, would not speculate on what the commission might recommend, but reported "that there appears to be no new evidence sufficiently compelling to cause Congress to reverse its action on single-line ratemaking." An important finding of the commission is that "attitudes about deregulation are changing."

Many carriers and shippers are apparently finding that earlier fears were exaggerated or unfounded.

Those who adapt to deregula. tion will survive carriers and shippers must have dialogue ... establish comfort area opportunities lor related services.

was established first by the Staggers Rail Act and reinforced by enactment of the Motor Carrier Act of 1980. "The rulemaking proceedings are done," according to Larry Lesser, public information officer, ICC. "The rules are either all complete or initiated."

The hand of the ICC has been lightened considerably and "the answers to questions of survival and opportunity is where it should be - in the marketplace," Lesser concluded.

The rail and truck deregulation acts will change forever patterns of distribution in this country. The dynamic and far-reaching implications of a free market for rail and trucking will alter even the consuming habits of the public. For some, deregulation has meant simply cutting rates or relying on long-standing shipper-carrier relationships to survive, until the economy "turns around." For others, deregulation is an opportunity for creativity. It has established a competitive environment and competition rewards creativity. Companies which are aggressive and efficient will create ventures from which they will prosper.

"Few would like to see deregulation reversed now," Darby said.

Tom Gallaghan Jr., managing director of the Contract Carrier Conference, American Trucking Association, underscored Darby's observation recently. He said, "The time has come to give up the ghost on regula- tion," criticizing motor carrier organizations which continue to fight deregulation. "I have a hard time understanding why those who speak for truckers insist on advocating rules that make it more difficult than it already is to make a living in the trucking industry," he said.

Rail and truck deregulation is a change that is here to stay. The stage from which this change is emerging

Deregulation has created business opportunities and these opportunities are becoming speculative business enterprises. Deregulation opened up entry into the trucking industry, allowing perhaps as many as 3000 new carriers to compete. For railroads it meant the ability to discard unprofitable tracks to small railroad enthusiasts who can more successfully compete in a limited market.

The "railroader," a deregulation born venture, is an innovative device which allows a single trailer to switch running gear to accommodate rail or highway. This is being tested as a means for improving railroad piggy backing.

Jim Senner, traffic manager, Wil(Please turn to page 67)