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The year in review … and preview

Posted: December 23, 2016 by John G. Smith

The year in review … and preview

It has been a newsworthy year in Canada’s trucking industry – and many of the stories of 2016 will also play out in the year to come.

Look no further than oil-related topics alone. Canadian plans for carbon taxes will lead to higher fuel costs, but could also raise funds to promote alternative fuels. Under the hood, maintenance teams now need to choose between two unique families of engine oil. Then there’s the matter of stubbornly low oil values and how they continue to stifle business in Alberta and beyond.

Consider these stories that will continue to make their presence known in 2017.

1.      Cleaner air, higher equipment prices

Clean air comes at a cost, and that is particularly apparent whenever regulators tighten the limits on emissions. Luckily, Phase II Greenhouse Gases rules will improve fuel economy, giving truckers a chance to recoup the investments on 2018-27 Model Year equipment. That’s the good news. While Environment Canada traditionally aligns its rules with the U.S. Environmental Protection Agency, that could threaten some uniquely Canadian spec’ing options. Research into everything from tires to 6×2 tractors will continue as regulators prepare to unveil Canadian versions of the rules.

2.      Struggles in oil country

Low oil values have calmed prices at the pump, but they have also hit fleets and owner-operators who serve Canada’s famed oil patch. Ritchie Bros. Auctioneers hosted a record-breaking sale in Edmonton this April, reselling about 10,600 pieces of equipment. That is clearly the sign of a struggling industry, especially when you consider that just 46% of the purchased equipment stayed in the province.

3.      … and a new oil category

Creating a new oil category is no small matter. Engineers have been working for years on FA4 and CK4 formulas to support existing equipment as well as engines that meet the next generation of emissions standards. But that means buyers now have to choose between two types of oil when finding the right match for their equipment.

4.      The safety of cyclists

After recent cyclist-versus-truck deaths in both Ottawa and Montreal, plus a call from the Federation of Canadian Municipalities, the federal government is once again studying side guards which fill the gaps in a truck’s wheelbase. A new task force created by the Canadian Council of Motor Transport Administrators will even study technologies like cameras and sensors to see if they offer a better way to protect two-wheelers.

5.      A marriage made in Europe

Volkswagen Truck and Bus stunned North America’s trucking industry when it purchased a 16.6% stake in Navistar. The companies are now investigating synergies that could create an estimated $500 million in savings – and bring a Volkswagen-engineered powertrain to our market by 2019.

6.      A toll on the industry

Toronto Mayor John Tory made headlines when he reversed his stance on tolls. Now it looks like the city is moving ever closer to charges for those who use two major routes into the city – the Don Valley Parkway and Gardiner Expressway. That may just be the beginning. Other municipalities are also looking for funds to support public transit projects, among other things.

7.      The price of carbon

Carbon has always come at a price. It’s paid every time someone pulls up to a fuel island. But Canada’s federal government is setting a “floor price” on carbon – the equivalent of $10 per tonne – and requiring every jurisdiction to introduce some form of carbon tax by 2018. In Alberta, for example, diesel will jump 5.4 cents per liter in the new year. Fleets like Rosenau Transport and Hi-way 9 Group of Companies have announced plans to introduce surcharges to cover the new fees. But could collected funds lead to more support for options like natural gas vehicles?

8.      Electronic Logging Devices

The days of paper logbooks are numbered for southbound fleets, with the U.S. preparing to mandate Electronic Logging Devices (ELDs) by the end of 2017. Canada originally led the way in discussions to set standards for the devices. Now we’re playing catch-up. With trucking associations backing their use, it may only be a matter of time before ELDs are mandated for domestic fleets as well.

9.      The Dollar Dilemma

A low dollar makes Canadian-produced goods more competitive, but it also increases the cost of U.S.-produced equipment. Expect the challenges to continue in the coming year.

10.  Rise of the Autonomous Vehicle

This year marked major milestones in the push toward autonomous vehicles. Freightliner unveiled a truck that could drive itself in Nevada. Platoons of trucks from DAF, Iveco, MAN, Scania, Volvo and Daimler made their tightly packed trips to Rotterdam in the Netherlands. A self-driving truck made possible by Otto delivered a load of beer to Colorado Springs. And Canada’s first autonomous truck is part of a Suncor trial in Alberta’s oil patch. Stay tuned for more. The march of technology continues.

11.  Electric power

Nikola unveiled an electric Class 8 over-the-road truck this year, and it could face competition before the first one rolls off the assembly line. Elon Musk of Tesla Motors has promised to unveil an electric Tesla Semi in 2017.

12.  The Demographic Cliff

Discussions about a driver shortage tend to fade away when the economy struggles, but there is no escaping the fact that Canada needs to attract a new generation of drivers. A 2016 study – Understanding the Truck Driver Demand and Supply Gap – determined that for-hire fleets will need 34,000 more drivers by 2024, many of whom will be needed to fill seats once held by drivers who retire or quit. Solutions will involve reaching out to underrepresented groups like millennials and women. In the meantime, limits on Temporary Foreign Workers have effectively eliminated another option.

13.  A new leader at the Canadian Trucking Alliance

David Bradley, arguably the most recognized industry lobbyist in trucking, retires this year from the role he defined as the long-time Chief Executive Officer of the Canadian Trucking Alliance. Stephen Laskowski has been named as his successor, and has already begun to assume many of the related duties.

14.  Smoke screening

Canada is moving ever closer to the legalization of marijuana, with related legislation to be introduced this spring, but that represents new challenges for fleets. Cross-border drivers are still being screened for the presence of the drug, and domestic fleets still have a duty to ensure that those in safety-sensitive positions are not impaired.

15.  The need for speed (limiters)

Speed limiters are the law in Ontario and Quebec, and the U.S. is now looking at using the technology to set top speeds anywhere from 95 to 110 kilometers per hour.

16.  Ontario prepares to MELT

Ontario will become the first jurisdiction in North America to introduce Mandatory Entry Level Training (MELT) for truck drivers, making it tougher than ever to earn a Class A licence. As of July, wannabe truckers face a minimum of 103.5 hours of mandatory training, including 36.5 hours in the classroom, 17 hours in yard, 18 hours behind the wheel and off the road, and 32 hours on the road. But will this bring an end to licensing mills that do little more than take tuitions and create poorly trained licence holders?

17.  Tow trucks being pulled along

Ontario expands its Commercial Vehicle Operator’s Registration system to include tow trucks in 2017, although an “education” period will help to ease the rules into place. In the meantime, tow operators are still exempted from Hours of Service regulations and the need to pull into roadside scales.

18.  Super Truck, Part 2

We have seen the future, and it is reflected in SuperTrucks that manufacturers have developed with funding support through the U.S. Department of Energy. Volvo, for example, managed to reach 12 miles per gallon. Many related features have already become a reality. And another US $137 million has been set aside to develop new technologies through SuperTruck II.

19.  Weights and dimensions

Federal updates to weights and dimensions continue to roll out in provinces, with allowances for boat tails and longer tractor wheelbases. It isn’t the only change in the name of harmony. Ontario, Quebec, New Brunswick and Nova Scotia have found common ground on their Long Combination Vehicle programs, making it easier to run from one jurisdiction to the next. But the approach still differs from the rules embraced in Western Canada.

20.  Mandated stability controls

As of August 2017, Transport Canada mandates Electronic Stability Controls on three-axle tractors with Gross Vehicle Weight Ratings above 26,000 pounds, harmonizing with a U.S. rule that was introduced in 2015. There are an estimated 660 truck rollovers in Canada every year, and while that’s just 5% of all truck collisions, they are a particular threat to drivers.

21.  Lagging truck sales

Truck sales continue to drop across North America, with about 240,000 Class 8 sales expected this year. Projections for 2017 hover around 215,000 units.

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