The economic downturn will continue to impact our industry in 2009, so we will see the exodus of independent contractors and small drayage companies.
A large portion of the traffic moving in containers is retail merchandise, and we already see the consumer cutting back dramatically, which will continue for at least the first three quarters of 2009. As a result, we anticipate a capacity reduction of at least 10 percent in the container drayage industry.
This year brings in a new government leadership for the U.S. There will be a push for the new administration to accommodate the environmental groups and the unions, such as the Teamsters, who supported the elected officials with votes and financial support.
The president-elect has openly stated his support for the Los Angeles clean-trucks program, which requires company trucks and company drivers. That’s an open invitation to the Teamsters to organize drayage carriers. If we eliminate independent contractors and force only company trucks to service our ports, it will increase the price of trade and further hurt the U.S. economy.
The National Retail Federation says the concessions requirement and new fees could add more than $1 billion a year to cargo container costs for goods moving through the Port of Los Angeles. I believe the industry as a whole is for clean trucks. But we are against intrusive measures to drive out the thousands of drivers who operate as independent owner-operators.
On the East Coast, there is a movement by carriers to accommodate the ports and meet their emission standard requirements, but to do it in consort with the EPA and independent contractors through federal grants and company support. This will exacerbate the problem for smaller carriers that do not have the financial resources to retrofit their independent contractors.
The East Coast movement by carriers is good for the environment, drivers and the U.S. economy. This movement should be explored as a solution for the West Coast. We can green our industry the East Coast way.