Indiana Logistics Summit Infrastructure Needs and Opportunities September 26, 2007

1. Indiana Logistics SummitInfrastructure Needs and OpportunitiesSeptember 26, 2007

2. TRANSPORTATION INFRASTRUCTURE

3. Trucking’s Progress Since 1985 ATA’s Monthly Truck Tonnage Index (1993 = 100) 6% Average Annual Growth Rate Trend Line Source: American Trucking Associations

4. Land Capacity: Congestion 2020 Estimated Peak Period Capacity Sources: US Department of Transportation, Federal Highway Administration

5. Only 4% of the Market Has More Than 20 Trucks, but We Believe That 4% Controls ≈70% of the Capacity Represents 613,242 fleets, including owner-operators with operating authority. Sources: Motor Carrier Annual Report, TT Press and American Trucking Trends 2005 by ATA.

6. Demographics Remain Unfavorable for Significant Driver Additions Source: U.S. Census Bureau

7. Ugly Demographics Will Persist Past 2010 • Males, ages 20-44: 52.3 mil. in 2000; 52.7 mil. in 2010; 0.1% CAGR • Females, ages 20-44: 51.8 mil. in 2000; 51.7 mil. in 2010 • At 3% GDP growth, driver availability would be 34% worse by 2010 • Males, ages 20-34: 0.4% CAGR, going from 29.9 mil. in 2000 to an estimated 31.1 mil. by 2010--the “only hope”--demographic is still growing at less than half the rate of GDP growth • Average age of a Teamster driver is 57 years--Yikes! • 209,000 of 1.3 million long-haul drivers retiring in next 8 years

8. Congestion issues are increasing Source: J.B. Hunt Transport, Inc.’s over-the-road shipments during October of each year

9. HOS - When do drivers drive? • Drivers drive during the normal work day hours • By 5:00 pm, 90% of a driving hours are expired 90% of the daily driving capacity is consumed by 17:00 each day

10. Policy Ideas to Improve Highway Congestion • Day of Week • Time of Day • Lane Restriction • By Vehicle Type • Increase Weight Limits • Increase Trailer Lengths • Expand Highways

11. Change the Weight Laws • 80,000 lbs. gross to 96,000 lbs. gross • Gain +20% • Safety Issues – Stopping distance • 79% of our JBHT freight would not apply • Increased road maintenance • Capital investment by the trucking industry?

12. Change Length Laws • 53’ – 57’ Trailers +7.5% cubic • Double Trailers “Twins” • Safety: Training of Drivers, Turning, Lane Changes, Backing • Road Infrastructure • Urban Areas – Docking problems • What roads would allow them? • Capital Investment by trucking industry

13. Increase Highway Infrastructure • 2 Lanes 4 Lanes • 4 Lanes 6 Lanes (Most interstate highways) • 6 Lanes 8 Lanes • 8 Lanes 10 Lanes Cost: $ $ $ Billions Time to Rebuild Setting Priorities

14. Re-Engineer Of U.S. Shippers Supply Chains • Mode conversion: • Truck → Intermodal • Truck → Dedicated • Less plant transfers – more customer direct shipping • Improved packaging • Better cube fill in trailer • All water shipping to east coast ports • Increase use of ocean containers staying intact • Shippers are manufacturing products closer to their customers • Customers are taking miles/loads out of the supply chain

15. Freight Mix? What will the freight mix look like in 5, 10, 15 years?

16. Who is Moving the Freight Today

17. How Freight Mix will look in 10-15 Years

18. Elements of Rail Capacity • Vehicles (locomotives and cars) • Line-of-road (alignment, signal systems, number of tracks) • Terminals (location and capacity) • Operating Plan • People • Execution

19. Possible Solution • Have 5-15 year plan on building 15-20 new Intermodal terminals • Have Government Assistance • Site location • Environmental issues • Financial - Industrial bonds, tax incentives, etc.) • Benefits • Highway congestion – reduces pressure on highway expansion • Economical – Best return on a dollar spent • Helps Greenhouse issues • Saves Fuel 3:1 • Help the trucking industry recruit drivers – more local jobs

20. Summary: What’s the Best Solution? • Combination of Rail and Highway Rail InfrastructureHighway Infrastructure Terminal ExpansionEspecially Urban Areas

21. Thank You Always Buckle Up and Please Drive Safely!