The president of the Ontario Trucking Assn. told members gathered for the recent 77th annual OTA convention that, "2004 has got to be better than 2003."
David Bradley, who is also chief executive officer of the Canadian Trucking Alliance, said, "Perhaps no industry is as reflective of the overall economy than trucking. And 2003 was a tough, tough year for most carriers.
"The list of factors that visited hardship upon the industry over the last year seems endless – the war in Iraq helped push of the price of diesel fuel to record levels; insurance premiums continued to skyrocket; the Canadian dollar appreciated by 20% almost overnight; the costs of all the new security initiatives began to hit home.
"On top of that we had the SARS crisis, the mad cow scare, followed by the big blackout. It’s rough enough in normal times in the trucking industry, but having all these things occur in the same year is extraordinary."
However, Bradley said he sees better times ahead for the carriers that made it through 2003. "There is no doubt that the U.S. economy is picking up steam – all the signals point in that direction – and that will boost Canadian economic prospects too."
He said the pick-up in economic growth "will further tighten capacity in the trucking industry, creating even better conditions for a meaningful and sustainable correction in freight rates.
"With the kind of cost escalations the industry has had to endure over the past couple of years, carriers have become more selective already. Once the economy picks up, those shippers that work with their carriers to improve efficiency and productivity – and are prepared to pay a fair rate – will get the service."
However, he said the timing and the breadth of rate adjustments will depend on the degree of market discipline the carriers adopt. "The conditions are ripe (for rate increases)," he said, "But it’s up to the carriers to make it happen."
According to Bradley, "2004 will also be a critical year on the regulatory agenda," citing the introduction of new U.S. hours of service rules on Jan. 4th, 2004, the ongoing battle over whether Canada will adopt a sleeper berth exception as part of its own hours of service reforms, as major concerns. In addition, he says that "in the coming year we’ll see what the final form – and the costs – of a number of key U.S. security proposals, such as electronic pre-notification of general freight and the driver license protocols for hazardous materials."
"Facilitating efficient cross-border trade in the face of the United States’ unrelenting and singular focus on security continues in my view to be the greatest economic challenge Canada faces. As a nation we cannot become complacent about these issues or we run a very real risk of losing direct investment which we so desperately need to continue generating growth and jobs."
David Bradley, who is also chief executive officer of the Canadian Trucking Alliance, said, "Perhaps no industry is as reflective of the overall economy than trucking. And 2003 was a tough, tough year for most carriers.
"The list of factors that visited hardship upon the industry over the last year seems endless – the war in Iraq helped push of the price of diesel fuel to record levels; insurance premiums continued to skyrocket; the Canadian dollar appreciated by 20% almost overnight; the costs of all the new security initiatives began to hit home.
"On top of that we had the SARS crisis, the mad cow scare, followed by the big blackout. It’s rough enough in normal times in the trucking industry, but having all these things occur in the same year is extraordinary."
However, Bradley said he sees better times ahead for the carriers that made it through 2003. "There is no doubt that the U.S. economy is picking up steam – all the signals point in that direction – and that will boost Canadian economic prospects too."
He said the pick-up in economic growth "will further tighten capacity in the trucking industry, creating even better conditions for a meaningful and sustainable correction in freight rates.
"With the kind of cost escalations the industry has had to endure over the past couple of years, carriers have become more selective already. Once the economy picks up, those shippers that work with their carriers to improve efficiency and productivity – and are prepared to pay a fair rate – will get the service."
However, he said the timing and the breadth of rate adjustments will depend on the degree of market discipline the carriers adopt. "The conditions are ripe (for rate increases)," he said, "But it’s up to the carriers to make it happen."
According to Bradley, "2004 will also be a critical year on the regulatory agenda," citing the introduction of new U.S. hours of service rules on Jan. 4th, 2004, the ongoing battle over whether Canada will adopt a sleeper berth exception as part of its own hours of service reforms, as major concerns. In addition, he says that "in the coming year we’ll see what the final form – and the costs – of a number of key U.S. security proposals, such as electronic pre-notification of general freight and the driver license protocols for hazardous materials."
"Facilitating efficient cross-border trade in the face of the United States’ unrelenting and singular focus on security continues in my view to be the greatest economic challenge Canada faces. As a nation we cannot become complacent about these issues or we run a very real risk of losing direct investment which we so desperately need to continue generating growth and jobs."
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