Act in review: Capacity concerns

by David Bradley

Last month, I reported that a statutory review of the Canada Transportation Act has been launched and focused my comments on issues relating to the disjointed regulatory system governing extra-provincial trucking.

In this column I will discuss CTA’s response to the crux of the review. Namely, the extent to which the national transportation system has the capacity and adaptability to respond effectively to evolving international and domestic conditions and markets.

Perhaps the most significant trend in freight transportation – despite changes in the mix and trajectory of trade, consumer behaviour and logistics practices – is that trucking will remain the dominant and fastest growing of the modes. Some of the players will change. Services will evolve and technology will drive improvements in productivity, safety and environmental sustainability. But, the old saying, “If you got it, a truck brought it” will be as true in the future as it is today.

The single most important issue for trucking is whether it will be able to provide the capacity to meet the demand for service going forward.

The industry is facing a long-term, chronic shortage of qualified truck drivers brought on in part by a demographic tsunami.

The carriers will go to the market to seek the rates needed to ensure compensation packages are competitive or better compared to other industries and to manage lifestyle and other issues in order to enhance the attractiveness of the job.

But, the occupation also needs to be recognized for what it is by the federal and provincial governments – a skilled occupation. The availability of world-class, efficient and productive infrastructure – roads, highways and bridges – has a direct impact on the reliability and predictability of supply chains and therefore where direct investment flows to.

Canada does not have a national highway policy. A program of long-term, predictable and dedicated highway funding program is needed. Funding for such a program could come from the federal excise tax on diesel fuel, which currently serves no policy purpose.

Consideration for how to maximize the utilization and capacity of existing infrastructure is also needed. Technologies such as intelligent highway systems, scale by-pass, etc., can contribute to improved commercial traffic flow, fewer delays, reduced congestion and more efficient and predictable delivery times. The trucking industry is investing massively in GPS and other on-board management systems to improve equipment and human utilization, to match loads, fill back-hauls, etc. New, more productive vehicle configurations are allowed in some parts of the country and not in others.

Current logistics practices adhere to a 24-hour-a-day clock.

The more that can be done to incent shippers to ship or receive goods during off-peak times, the better.

Unfortunately, too many shippers will not pay to have staff available to load or unload during the off-peak times. In addition, the public, which often complains about truck traffic, opposes off-peak deliveries if it means trucks operating in their neighbourhood at night. Local by-laws (truck routes/bans) often reflect this attitude. Notwithstanding the productivity and efficiency advancements that have been made since economic deregulation was introduced in the late 1980s, there is still waste in the supply chain.

Too often trucks will meet their delivery appointments at distribution centres, intermodal yards, terminals, ports, etc., only to have to wait sometimes hours to be unloaded.

With the number of hours a driver can work restricted by regulation this can severely impair productivity. Motor carriers, their customers, the consignees and third party logistics providers all need to work together to maximize efficiency.

The Minister of Transport also asked the review panel to pay particular attention to the “urgency created by the recent backlog in grain deliveries (by rail) from the 2013-14 crop year.”

Trucks move nearly all harvested grain to on-farm storage, and then on to the elevators – both usually short distances.  From there it is moved by rail to terminals thousands of kilometres away – a distance that is too long (and the loads too heavy and bulky) for trucks to be economically competitive. While there are several trucking companies specializing in grain shipments, most see little prospect for trucking ever to become a viable alternative to rail. Seasonality and the ups and downs of crop volumes are a drag on investment in equipment and drivers.  Regardless, there will never be enough, roads, highways, trucks and drivers.


David Bradley is CEO of the Canadian Trucking Alliance and the Ontario Trucking Association.

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