The Death of Trucking - will it die, as Rail & Sea soars

[drbubb]

Few seem to be talking about it, but $4 per gallon gasoline seems to have pushed

many small family-owned Trucking firms over the edge

 

Reportedly, small firms are going bust all across the country.

And GM has shifted its manufacturing production away from Trucks.

 

DJ US Trucking Index

... update 1 : update 2

 

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Here's a posting from Depression2, which picks up on this theme:

 

(from Robert -

 

I grew up South of Detroit in a city called Toledo. We are a smaller cousin of Detroit as most of our industrial output hinges on the Big 3 automakers. We have Jeep/Chrysler/Ford and Chevrolet plants in our area. As Detroit has gone, so have we. But our city size never grew that big, so the re-adjustment hasn't been as severe.

 

To blame what is happening in Detroit on the current crisis is to misunderstand what happened in Detroit. I can remember going to see a Red Wings game back when I was 14 years old(almost 25 years ago) and having the same exact impression as you did. BLOCK and BLOCK of gutted homes and tenament buildings. It was eerie. But this is a disaster that was in the making for decades. I am sure parts of the city have gotten exponentialy worse over the past 5 years, but the rot has been there for far longer.

 

I won't try and gloss over the problems with Detroit, but what I will try and do is paint a picture of what could be. Detroit WAS NOT a city designed for Automobile age, it was hi-jacked and forced to be that way. Detroit was founded on the shores of lake Erie and the Detroit River as a frontier town fort, much like Toledo, Ohio. It was known as Fort Detroit and it was perfectly located near a large expanse of water(lake Erie) and a large river(Detroit River). It makes it a perfect location as a transportation hub in a future of NO TRUCKING. It is serviced by the heaviest concentration of heavy rail outside the Eastern corridor and has ultimate access to the Atlantic Ocean through the Erie Canal and SOON it will be serviced by deep ocean cargo container ships from Canada.

 

So LONG TERM I think Detroit will lead this country into this new area, as will my home city of Toledo. We are currently (toledo) a hub of Solar Technology. Big solar firms are locating here such as First Solar. They realize our central location and our proximity to the Great Lakes will revitalize this area, for the same exact reason it became the hub of this country in centuries past. THINK IT THROUGH. Once there is a re-alignment(read crash) of the US Economy, things will take on a decidedly 1800's type look to it. Low energy transport has to be part of the solution and Detroit and Chicago and Up-State New York and Cleveland and all those old Rust belt cities are going to be the future transport hubs once again.

 

Trucking and the interstate highway systems destroyed these cities. What is truly ironic is that it was the short sided vision of the Ford's and Goodyears that brought about this outcome. If they hadn't destroyed the rail systems and other long distance transport systems(barges, river shipping), by pushing Trucking, we probably wouldn't be in this mess.

 

They COMPLETELY misunderstood the power of their discovery. They weren't patient enough. They thought that at 10% of the population owning automobiles they had "saturated" their markets. Time would have proven that to be totaly wrong. People would have understood the benefit of the Automobile for short range transport and the inner-city infrastructure would have risen up to accomadate it. But in typical socialist fashion they got the government to help them conspire to kill long range transport in favor of trucking and busses and automobiles.

 

/see: Tue, 06/03/2008 - 08:16 / http://www.depression2.tv/d2/node/118?page=1

[drbubb]

(these price rises & falls are not as bad as I expected to find.

Maybe the anecdotal stories I read were exaggerated.)

 

DJ US Trucking Index

... update 1 : update 2

 

Best Performing Stocks

 

Arkansas Best (ABFS) - one of the top performers ... update

 

another Top performer, making new highs on its long term chart

 

C H Robinson Worldwide Inc (CHRW) ..... update : 1 year chart

 

Best Performing Stocks

 

Symbol Company Name Percent Change Chart

 

VTNC Vitran Corporation Inc. 23.63%

ABFS Arkansas Best Corp 22.82%

YRCW Yrc Worldwide Inc 20.44%

UACL Universal Truckload Svcs I... 19.32%

CHRW C H Robinson Worldwide Inc 18.86%

QLTY Quality Distr Inc Fla 18.64%

CLDN Celadon Group Inc 17.32%

PATR Patriot Transn Hldg Inc 16.96%

LSTR Landstar System Inc 16.88%

JBHT J B Hunt Transport Service... 16.61%

 

Worst Performing Stocks

 

Symbol Company Name Percent Change Chart

 

IDMV Indiemv Media Group Inc -55.56%

CVTI Covenant Transport Inc Cl... -39.20%

LMLG Last Mile Logistics Group... -38.89%

CFWEQ Consolidated Freightways C... -30.00%

SAIA Saia Inc -15.51%

USAK USA Truck Inc -4.32%

PTSI P A M Transportation Svcs... -0.41%

ODFL Old Dominion Freight Line... 0.86%

CNW Con-Way Inc 1.12%

WERN Werner Enterprises Inc 2.51%

 

/see: http://bigcharts.marketwatch.com/industry/...cind_sid=171609

[drbubb]

This SOURCE - which was last updated in February, doesnt yet show the RAIL BOOM I expected:

 

Trucking and Railway

February's national truck tonnage index from the American Trucking Association was unchanged from its January reading and up 3.5 percent compared with February 2007. Higher diesel prices and weak freight demand were dominant factors for the disappointing first quarter financial performance of several regional trucking companies. Regional rail industry data for March and April show widespread weaknesses, with shipments of housing-related products and autos and intermodal shipments posting the largest declines. On the brighter side, regional rail shipments of chemicals, farm goods, and some metals posted improved readings in recent weeks.

 

/see: http://www.frbatlanta.org/econ_rd/regional/ind_activity.cfm

[malco]

The trucking industry is the most egregious example of political expediency. Great postures are struck by politicians and state bureaucrats caring about road safety, yet for decades they have bent over backwards to serve the interests of the most dangerous vehicles on the roads. The media play along with it too. Cycling and walking are "dangerous", but no mention of the 600 deaths per year in the UK in collisions with HGVs. When did you ever hear a media campaign against the trucking industry's atrocious safety record? You never did. Not even "Private Eye" would do more than mention it in passing.

 

I have to say that I have never entirely understood why the politicians love trucks so much. Trucks have enabled industry to become so dispersed that rail could never be substituted when oil goes through the roof. Large tracts of industrial estates will die and doubtless will become occupied by homeless unemployed during the coming collapse.

 

Two beneficiaries have been landowners, selling land for turning into industrial parks; plus the construction industry has earned well building heavily reinforced bridges and motorways. I suppose there must have been a feeling that the railway unions were too powerful to trust, and the truckers were a big business lobby that would not make trouble. It still surprises me that a wasteful, dangerous industry has been so heavily supported. Now all that investment will count for nothing; its utility will fall to practically zero, except that our marvellous motorways will be a geographic feature for probably about as long as the Roman roads have been.

 

Here in Europe the truckers are getting bloshie about high taxes on fuels. I think they will be treated like the miners were in the 1980s. They will get hammered and then rendered redundant by a swing back to rail and sea and reallocation of industry to places that can be served that way.

 

I certainly won't cry to see the back of them. They are an abomination. The only good HGV is dumped on its back in a scrap yard waiting to be turned into rails.

[drbubb]

I have to say that I have never entirely understood why the politicians love trucks so much. Trucks have enabled industry to become so dispersed that rail could never be substituted when oil goes through the roof. Large tracts of industrial estates will die and doubtless will become occupied by homeless unemployed during the coming collapse.

 

Block trucks and Rail and Sea will thrive.

 

That's the lesson that I draw from Japan. where problems in getting around with cars,

has helped Tokyo's efficient rail system to develop.

 

Why is transit so much more successful in Japan than in the United States? There are a number of factors.

 

Historically, much lower personal income in Japan kept automobile ownership at lower levels, so transit demand is higher.

 

Unlike U.S. and Western European transit systems, profitability makes the transit systems of Japan sustainable. Westerners have yet to learn that massive subsidies are not the path to larger transit market shares.

 

Urban expressways in Japan require heavy tolls--something generally not found either in the United States or Western Europe.

 

The suburban rail systems in Japan also operate thousands of buses (more than 10,000 in Tokyo and 2,500 in Osaka), which circulate through neighborhoods and deliver people to the rail stations.

 

Downtown employment in the Japanese cities is far greater than in the U.S. The Tokyo Yamanote Loop has double the employment of Manhattan, while the Osaka Loop has three times the employment of Chicago’s.

 

The suburban rail systems of Japan were built concurrently with or ahead of the suburban sprawl (both Tokyo and Osaka sprawl extensively), and system upgrades were made to maintain their superior speeds. The dense mesh of service provided by these systems is simply not to be found in the West.

 

All of these factors have played an important role in the success of Japanese transit. But the principal reason for the success of the Tokyo and Osaka systems is their competitiveness with the automobile.

 

Average transit speeds in Tokyo and Osaka are 1.5 times that of the automobile

 

/MORE: http://www.heartland.org/Article.cfm?artId=12887

 

For emphasis, I shall repeat part of this:

All of these factors have played an important role in the success of Japanese transit. But the principal reason for the success of the Tokyo and Osaka systems is their competitiveness with the automobile.

Average (rail) transit speeds in Tokyo and Osaka are 1.5 times that of the automobile

 

[drbubb]

From COMMENTS - on the Detroit, 2nd Great Depression article

 

I think you are looking to

Tue, 06/03/2008 - 09:44 — Robert (not verified)

I think you are looking to soon. Places like that and Detroit have a lot further to fall before any kind of recovery. But in an era of 200 or 300 dollar oil and gasoline prices over 8 bucks, you'll see LOCALIZATION coming back. Not because it's vogue or cutting edge, but out of neccesity and because people will want to survive.

 

And the places that survived and thrived before the era of cheap oil and transport, was the exact cities I mentioned. They were hubs of trade and enterprise. Not globalization, but local producers looking to get their stuff out to people in nearby communities and states.

 

The world is going to shrink dramatically over the next decade and what was old will be new again. Cities with no major rail or no major port fascilities are going to wither away, and cities WITH those attributes will become the new central hubs of the rebuilding effort. Detroit is perfect as NO ONE LIVES THERE, so rebuilding is that much easier, just bulldoze the crap and start the rebuilding.

 

Robert/ http://www.depression2.tv/d2/node/118?page=1