Ray Kuntz

1. Ray Kuntz Watkins and Shepard Trucking

2. The Trucking Industry

3. Historical Tonnage by Mode Billions of Tons JIT/Supply Chain Truck Interstate Highway Deregulation Rail Sources: ATA & U.S. Freight Transportation Forecast to 2024 & ATA

4. Real GDP Forecast Source: ATA

5. What Drives Truck Freight Volumes ?

6. Annual Housing Starts(Millions of Units) 2014 will be the highest level since 2007.

7. Real Consumer Spending(Annual Percent Change) Sources: BEA and ATA

8. Real Consumer Spending – Goods Only(Annual Percent Change) Sources: BEA and ATA

9. Factory Output (Annual Percent Change) Sources: Federal Reserve and ATA

10. US Crude Oil Production(Millions of Barrels per Day) 56% increase Source: EIA

11. Trucking Trends: Demand

12. Changes in Truck Freight Volumes Sources: ATA’s Monthly Truck Tonnage Report & Trucking Activity Report

13. Miles Per Truck Per Month are Down too(Includes all types of TL carriers) Source: ATA

14. Trucking Trends: Capacity

15. TL Tractor Changes(Percent Change in the Number of Company & IC Tractors) Includes all types of truckload carriers Q1 is January & February only. Source: ATA’s Trucking Activity Report

16. LTL Tractor Changes(Percent Change in the Number of Company Tractors) Includes all types of truckload carriers Q1 is January & February only. Source: ATA’s Trucking Activity Report

17. TL Revenue/Mile – Starting to see upward movementIndex: 2000=100; Seasonally Adjusted Source: ATA

18. TL Pricing Metrics – Starting to see upward movement(Seasonally Adjusted) Sources: ATA’s Trucking Activity Report andDAT.com

19. TL Supply vs Demand 2005 = 100 TL Loads Index TL Tractor Count Index Oversupply Through February 2014 Source: ATA based on Trucking Activity Report

20. LTL Pricing Metric Slowed Recently, but Probably Not for Long(Average Revenue per Ton; Seasonally Adjusted) Sources: ATA’s Trucking Activity Report

21. Costs & Drivers

22. Diesel Prices Source: US Department of Energy

23. The Class 8 Fleet Has Aged, but the Industry Is Struggling to Reduce It (Average Age in Years) Source: ACT Research

24. Motor Carriers Are Struggling to Replace Their Trucks New Diesel Tractor (Sleeper) Price Estimate (Annual Averages) Source: ACT Research

25. TL Truck Driver Turnover Rates 2013 LTL: 11% Source: ATA

26. TL Carriers are Struggling with Independent Contractors as well as Company Drivers (Independent contractor trends over the last two years) Large TLs: -1.1% Small TLs: -6.5% Includes all types of TL carriers; January 2012=100; Carriers with at least $30 million in annual revenues

27. Average Annual Pay for an Over-the-Road Tractor-Trailer Driver in the For-Hire Truckload Industry Includes bonuses; All types of TL drivers included Blue bars is actual pay. The orange line is if pay kept up with inflation. Sources: ATA based on the 2011 Driver Compensation Study and data from the Bureau of Labor Statistics

28. Legislative Challenges

29. Highway Trust Fund Almost Bankrupt

30. Highway Bottlenecks Worsening

31. CSA Improvements Needed • No clear relationship between violations and severity weights • Only 13 violations out of 754 are related to crash risk • Carriers with less than 20 trucks are 3 times more likely to be above threshold

32. HOS Action Needed • New Restart restrictions a real problem for fleets & drivers • Average productivity loss is 2-4% from these rules; some fleets much higher • Lost driver wages range from $1.6 to $3.9 billion

33. HOS Action Needed • GAO requested by Congress to evaluate DOT’s HOS research • FMCSA’s C/B analysis • FMCSA’s Restart field study • Trucking seeking to “Stay” Restart rule until GAO is finished

34. ATRI IDENTIFIES PR­OBLEMS WITH FMCSA HOURS-OF-SERVICE FIELD STUDY REPORT Arlington, VA -The American Transportation Research Institute (ATRI) today released the findings of its independent evaluation of the Federal Motor Carrier Safety Administration’s (FMCSA’s) field study report on the new Hours-of-Service (HOS) rules.  FMCSA was directed by Congress as part of MAP-21 to study the efficacy of the restart provisions which went into effect July 1, 2013. • FMCSA’s field study collected fatigue measurements from 106 truck drivers during two duty cycles that included two restart breaks.  FMCSA stated that their field study results supported the efficacy of the new restart rule.  Following a detailed evaluation of the field study report, ATRI identified a variety of technical issues related to research design flaws, validity of measurement techniques and interpretations and data conflicts within and across the study.  

35. ATRI DOCS

36. NEW TRUCK DRIVER HOURS OF SERVICE REGULATIONSApril 2014 Device Adoption – Require fleets to adopt and use complaint devices. The soonest FMSCA is likely to issue final rule is early 2015, adoption deadline early 2017 at the very soonest. Location Monitoring – Require recording of vehicle location at every change of duty status and at a minimum of 60 mile intervals. Supporting Documents – New document retention requirements to verify time spent on-duty, not driving. Certification – Manufactures required to test and certify device compliance to FMSCA. Short Haul Drivers – Drivers who are not required to complete logs because they meet one of the short hauling exemptions would not be required to use ELD’s. Proposal - Congress should require FMCSA to stay implementation of the restart provisions in the new truck driver hours of service regulations that became effective 7/1/13 pending a GAO review.

37. Thank you