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Green Strategies for Profitability

October 12, 2009

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Being "green" can be a real win-win for trucking companies. That was the message of a panel session on "Green Strategies for Profitability" during the American Trucking Associations' annual management conference last week in Las Vegas.


"As we begin to reduce our use of fossil fuels and be more efficient, we not only enhance our sustainability as an industry and as a company, we also reduce our costs as companies," said Doug Duncan, president and CEO of FedEx Freight. "But you have to take a long view."

Kissing frogs at FedEx Freight

At FedEx Freight, they try to find ways to reduce their carbon footprint and reduce fuel use with every purchase. The company also works closely with vendors on research and development of new technologies.

"The good news is, there are lots of new ideas out there," Duncan said. "But you have to kiss a lot of frogs to find a prince."

For instance, FedEx has been testing hybrid vehicles in its fleet for more than two years. "While I don't think the current hybrid technology will be the answer, I think the next generation of plug-in hybrids holds a great deal of promise."

In addition, by the end of the year, FedEx Freight believes it will have a Class 8 truck in use operating on a hydrogen fuel cell. "We'll lose about 40 horsepower, but we'll gain it in torque, and the only emissions will be water - which would be a major breakthrough."

But you don't have to go high-tech to have a major impact on greenhouse gas emissions and fuel usage, Duncan pointed out. "Our research indicates that with proper use of the vehicle by drivers, we can improve fuel efficiency by as much as 30 percent," through education, training and feedback.

FedEx Freight's efforts in sustainability also go beyond its fleet. The company has found that using the roofs of many of its trucking terminals to install solar panels allows the company to actually generate power to put on the power grid during the day, then they are able to use that power at night when the facilities are busiest. New fluorescent lighting in the facilities burns 50 percent less energy than the old mercury vapor lamps. "These are things that are valuable to us today, that have ROI in weeks rather than years," Duncan said.

Saving fuel at Con-way

Con-way started a serious green/sustainability initiative in 2007. "Our companies are very large consumers of energy," Con-Way President and CEO Doug Stotler noted - approximately 150 gallons a year, "and to date there's really no commercially viable alternative to diesel. Our goal was to save a natural resource that we critically need to support our company, as well as to save money" and improve their carbon footprint.

Con-way Freight cut their speed limits to 62 mph from 65, which made for a 3.8 percent reduction in fuel usage, saving the company $11 million a year. They also adopted low-profile tires and went through an extensive network reengineering initiative that eliminated over 100,000 miles a night in its linehaul operation.

Con-way Truckload has adopted similar speed limit reductions and fuel-saving tires, in addition to implementing auxiliary power units in its single driver fleet.

U.S. Xpress

"Since Max [Fuller] and I started U.S. Xpress in 1985, finding ways to be more efficient has been part of our philosophy," said Pat Quinn, co-chairman and president of U.S. Xpress Enterprises.

"We've been an early adopter of new technologies and proven technologies, but you have to see the benefit." For example, in 1998 the company started switching to automatic transmissions, which has definitely resulted in fuel savings.

"Today there are more opportunities than ever," Quinn said. "The challenge is to find the applications that work in your particular fleet."

Tires and aerodynamic designs offer some of the greatest potential, he believes. Green initiatives the company has tested and found to deliver fuel savings include wide-base tires, full aero packages for trailers, low-rolling-resistance tires, aerodynamic mudflaps, trailer side fairings, computer optimized routing, and an in-cab auxiliary heating system that's now standard on U.S. Xpress tractors.

"Driver involvement is a key element to success," Quinn said, especially when trying to reduce idling time. "We have committed more than $400,000 in incentives for leading idle-reducing drivers. In our first month of that program, we have seen a 15 percent reduction in idle time. We have made the case to our drivers that the money we save on idle reduction gives us strength in an extremely challenging marketplace."

Being Proactive

"It's very important we be proactive so we can achieve our own results the right way, rather than let a bunch of bureaucrats in Washington" start putting mandates into place that might not make as much sense for the industry, Duncan said.

Duncan is concerned that since fuel prices have dropped back down from the staggering $5 a gallon highs of last year, that many of the discussions on how to save fuel have ceased. "I think that's short-term thinking," he said. "This is a long-term journey, and if we don't get started on it, we will never get there."

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