John Cornyn floats idea of truck-only mileage tax, Late-model used truck prices are booming
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Let's get to the news 🗞
Here's what our signal caught this week:
Flatbed leads owner-ops into year of rosy earnings expectations
Owner-operators extended a financially strong 2020 into the first quarter, with net income promising a year that tops $65,000, based on ATBS client averages.
Flatbed haulers led the pack. If a March surge heralds an over-the-top construction season, their 2021 earnings might be well north of $70,000.
One Transmitter reader who hauls oversized/overweight loads pushed back on this report, citing that lowboy/RGN has to be the leading segment for truck driver earnings. Unfortunately it seems specialized freight is never included in this data.
Read more about this article at Overdrive Online
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Truck-only mileage tax put back on the table by Texas Senator
Sen. John Cornyn (R-TX) on Tuesday suggested using a truck-only vehicle miles traveled tax during the Senate Finance Committee's hearing on infrastructure funding.
His suggested method would levy a tax of 25-cents for every mile driven. The mileage would be tracked via government-mandated devices that report the data back to the IRS.
While Cornyn did suggest a potential VMT could come with "perhaps some relief on other fees" levied on truckers and fleets, Texas Trucking Association President and CEO John D. Esparza noted taxing drivers a quarter for every mile equates to approximately $25,000 per truck that drives 100,000 miles a year – almost half the average salary for a truck driver.
This recommendation is not likely to make it to law at this point and highlights the lack of consideration some politicians have to the negative impact a tax like this could create for the overall economy and the wellbeing of truck drivers and trucking companies.
Read President and CEO of the Texas Trucking Association John D. Esparza's take on this unofficial and informal suggestion here.
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Texas tops list for truck driver drug/alcohol violations
According to the latest clearinghouse data (as of May 1) released by the Federal Motor Carrier Safety Administration (FMCSA), Texas recorded 7,268 violations, followed by California with 5,312 and Florida with 4,033. The number of violations in those states are understandably high because they are among those with the highest number of employers that register violations into the clearinghouse.
However, when considering the number of violations per number of registered employers, Alabama, Tennessee and Georgia top the list, with violation rates of 51.5%, 45.0% and 44.0%, respectively, among the 25 states with the highest number of registered employers (between 3,000 and 26,000).
The top violation rates among all states regardless of the number of employers were Louisiana, Hawaii and Mississippi, with rates of 72.3%, 61% and 59.3%. (The District of Columbia compiled 85 violations with only 66 employers registered in the clearinghouse, for a rate of 129%.) Read more here.
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Late-model used truck prices go stratospheric
Prices of newer used trucks with low mileage are reaching historic levels with new truck deliveries slowed by supply chain issues and an ongoing shortage of microchips.
“[Auction] pricing for trucks with under 600,000 miles is in the stratosphere,” J.D. Power Valuation Service reported in its latest Commercial Truck Guidelines newsletter. For example, model-year 2018 trucks with under 500,000 miles are selling at auction for around $70,000.
Compared to the first four months of 2020, Power’s benchmark group of 4-to-6-year-old trucks were selling for 76.6% more than the same period a year ago. Read more at FreightWaves.
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ATRI's 2021 Research Priorities include young drivers, electric trucks
Understanding the most effective way to bring 18- to 20-year-olds into the trucking industry was listed as a top 2021 research priority for the American Transportation Research Institute.
Another ATRI research priority has to do with charging infrastructure considerations for electric trucks. Research will consider power demand scenarios, grid connectivity availability and vehicle charging requirements.
Also on the ATRI list this year is understanding the environmental impacts of zero-emission trucks. Read more about their 2021 priorities here.
Until next week,
Over and out