January 2015 Volume 35, Issue 1
Happy Holidays to All!
TRUCK NEWS Stuck in a truck
We test drive the 2016 model year Volvo VN, including its new Adaptive Gearing feature.
In high demand
Record-setting demand for new trailers has pushed out build times and dried up the used and rental markets.
Buffalo ‘snow-pocalypse’ leaves truck drivers stranded in their cabs
BUFFALO, NEW YORK
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On the prowl
Caterpillar gave us a good look at its latest vocational truck, the CT681.
2015
By Sonia Straface
In mid-November, Brian Foster, a professional driver for Ontariobased J.G. Drapeau Transport, made a delivery he’ll never forget. On Nov. 18, the snowfall in Buffalo, N.Y. shocked residents when an incredible seven feet of white fluffy stuff covered their roads, yards and cars. Buffalo and surrounding areas were in a “snow-pocalypse” as it has been dubbed on social media because of the lake-effect, a weather phenomenon that happens when cold air moves across warm water (Lake Erie) and forms steam clouds. A travel and driving ban were issued in the city; pro sports games were postponed and relocated and residents had been opening their front doors to a wall of white. After picking up a load in Indiana, Foster was driving back up to deliver in Fort Erie on Nov. 18. He was just 30 kilometres west of Buffalo, in a housing subdivision when the snow became unrelenting and filled up the roads. “I was driving along and I just couldn’t go anymore,” said Foster, 65, who has been a profession-
Delivering daily news at trucknews.com
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Ontario’s Transport Minister made some key policy announcements at the OTA convention.
Driving the new VN
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Taking a position
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Canada’s Trucking Newspaper Since 1981
BUSINESS OUTLOOK
Cautious optimism seems to be the theme for 2015. A strong US economy, weak Canadian dollar and low diesel prices are a few factors to watch.
The sun shone brightly on the trucking industry in 2014. But what does 2015 have in store?
By James Menzies
I
t’s been a good year to be in trucking. Most indicators of the industry’s health were positive in 2014. Class 8 truck orders were robust, trailer demand unprecedented, freight volumes consistently strong and there were widespread reports of rate increases taking hold and improved pay packages for drivers and owner/operators being offered. It was exactly the type of year this industry needed. But what’s in store for 2015? We called upon industry experts to shed some light on what to expect in the year ahead. Specifically, we asked about: the US and Canadian economies; the regulatory outlook; mergers and acquisition expectations; and the price of diesel.
The US market outlook
Looking ahead to 2015, industry forecaster FTR continues to be bullish on the trucking industry’s prospects. Jonathan Starks, director, transportation analysis with FTR, told Truck News he expects to see the US economy continue to grow in the 3% GDP range. “Most indicators are positive,” he said. “There’s nothing really overtly strong, from what we’re looking at going forward, but the manufacturing sector is still holding up pretty well, which is a good sign for the freight environment. There’s no real acceleration but it’s staying pretty robust.” Starks said truck capacity will continue to be tight through 2015, barring a major change in regulations and/or the econ-
omy. This is allowing carriers to pass though rate increases, a trend Starks said is likely to continue in 2015. “If you look at the data you can see a definite upward trend in rates ever since about the middle of 2013. That’s when the new hours-of-service came into play and I think it had a noticeable impact on the marketplace being able to get rate increases,” said Starks. He added the spot market saw a major jump in rates over the last winter, with rates remaining elevated throughout the year due to a tightened truck market. Increases to contract rates tend to follow the spot market and Starks said “We expect to see some similar type of growth in 2015, especially on the contract rates side. It tends to take longer for contract rates to filter through the system.” As far as concerns go, FTR has been sounding the alarm about what it dubs “regulatory drag,” an onslaught of new regulations that could further inhibit the trucking industry’s productivity. However, Starks said carriers should enjoy a reprieve from new regulations in 2015 before new regulations are implemented in the following years. Referring to 2015 as a “buffer year,” Starks added “We think it will be in the 2016 timeframe before we see a big jump in implementation of regulations that will impact the market.” This past year saw a surge in demand for Class 8 trucks and trailers and while Starks said the current pace of order activity is not sustainable, orders placed this year should reContinued on page 23
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