Friday, October 31, 2008

Trucking regs will hurt Upstate economy

From the 03 November 2008 Greater Niagara Newspapers

By Bob Confer

Just when you start to think it couldn’t get any tougher to do business in New York State, it does.

David Paterson and the State Department of Transportation have spent the past few months fine tuning regulations which would inhibit the flow of goods across the Empire State. The State plans to experiment with a series of laws in the Finger Lakes region that would restrict tractor trailers in excess of 45 feet in length from travelling state and local roads and allow them to travel just on the interstates. They would be permitted to travel the lesser roads only if there was a direct and exclusive route to their client or if an emergency situation presented itself (such as inclement weather). After working out the kinks in the Finger Lakes test, the DOT plans to apply these regulations to the rest of the state.

Governor Paterson is pushing these regulations – which are being levied without the support of the state legislature - because he believes that the residents of rural upstate New York should not be subjected to what he considers “big trucks”. He claims the vehicles ruin the solitude and quality of life in the countryside and put undue stress on the infrastructure. This plays well on the emotions of the rural residents but does nothing for rational analysis of what the true outcome will be.

Without a doubt, these regulations will push a sickly upstate economy further into ruin.

This can be said with the utmost confidence because 45-foot trailers are dinosaurs. 53 ft. trailers are quickly becoming the industry standard. I asked our local traffic broker how many of each trailer size he schedules per week. Of his 125 loads, 95 are 53 ft. trailers, 30 of them are 48 ft. trailers and he doesn’t broker a single truck at 45 ft. in length (Paterson’s absolute maximum). That means the average tractor trailer won’t be able to travel the roads as freely as they can now.

One of two things will have to happen. The truckers will have to abandon the longer trailers or schedule lengthier routes. Both options will cost money. Lots of money.

If forced to go to the shorter trailers, load sizes will have to be cut by 9%. That will require the scheduling of a second truck, perhaps a common carrier. That will cause overall shipping costs for that same quantity-shipped to rise by 20% to 35%. That could equate to hundreds of dollars in new charges depending on where the truck is going.

If the drivers are forced into travelling longer routes it’s nearly as expensive. The New York State Motor Truck Association provided an example of a manufacturer’s daily shipments from Syracuse to Corning Glass. Right now, that truck travels 200 miles round trip. Were Paterson’s law to go into effect, the new round trip would be nearly 300 miles. Assuming one such trip a day, five days a week, the law would add an extra $63,627 per year in costs for that one trucking route.

Realize that the truckers and businesses can’t eat those costs. To make ends meet they must pass them on to their customers. That means you’ll be paying more for food at the grocery store or products at the department store because it will cost so much more to get it from Point A to Point B.

Even worse than that, you could be out of a job because of Paterson. Many times in these pages I’ve written about how expensive it is for a manufacturer to operate in New York State. Because of Albany, it’s 4% more expensive to work here than it is in our competitors’ states. The only financial saving grace we can offer our customers exists in delivery. That’s because the Niagara region is within 500 miles of 55% of the US population. So, a client may choose our goods, though more expensive at the piece price, because they can save on shipping. If Paterson’s laws were to take effect they would take away that lone advantage we have. Hundreds of New York businesses would then lose their existing customers (and potential customers) to their competition in the Ohios and Indianas of the world.

It’s obvious that the Governor has put little thought into the repercussions of his anti-business, anti-consumer trucking regulations. In his twisted mind he may think he’s doing good for Upstate, but in reality, he’s harming it. Someone’s going to be hitting the road and it won’t be the truckers…it will be all the businesses who know what’s best for them and their future.

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