|Thursday Dec 12, 2013 - Timpte Opens New Full-Service Branch in Bloomington, IL
David City, NE – Timpte, the industry leader in manufacturing bulk commodity trailers, is pleased to announce the opening of its newest service branch in Bloomington, Illinois on Monday, December 9, 2013. The 11,000 square-foot is located at 2312 West Market Street, Bloomington, IL.
The new location features a 6 bay shop, over-the-counter parts, and a large area for new and used grain trailers. The new location sets a quarter mile west of I-55/74 on Highway 9 and has easy access and ample amount of truck and trailer parking.
“I couldn’t be more excited about the new location,” says Rob Gerbitz, Branch Operations Manager, “Our commitment to Illinois is not just selling grain trailers, but making sure each and every customer is taken care of when they need us the most. My team is working diligently to earn the trust of our customers now and into the future.”
With over 130 years of experience, Timpte is a name you can trust for all your new and used grain trailers, as well as parts and service for all makes of semi-trailers.
Contacts: Timpte of Bloomington
Southern/Central Trailers Sales - Brian Lemenager 2312 W. Market St.
Branch Operations Manager – Rob Gerbitz Bloomington, IL 61705
Part Sales – Rob Pratt 855-820-0900 Toll Free
Service – Noah March 309-820-1099 Fax
Mark A. Hunt
Products & Marketing Coordinator
2902 23rd Ave
Council Bluffs, IA 51501
(712) 328-8651 Phone
(712) 328-1134 Fax
(402) 681-0105 Cell
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|Thursday Dec 12, 2013 - The future of freight brokering
The future of freight brokering in Canada: Part 1 of 3
Part one of this three-part series looks at the outlook for Canadian freight brokers and building and maintaining relationships
By: James Menzies
MISSISSAUGA, Ont. -- After selling MSM Transportation to Wheels Group last year, Mike McCarron joined Wheels to oversee mergers and acquisitions in a bid to consolidate the Canadian 3PL space.
To gain a greater understanding of where the freight brokering segment is headed, McCarron called together several leading brokers for a roundtable this week, hosted at Wheels Group’s headquarters. Also on-hand was Level5 Strategy Group, which will be compiling a white paper on the subject. Trucknews.com was invited to report on the discussion and will be publishing a three-part series this week.
The participants included:
Manny Speranza, FBI-Freight
John Tittel, Hot Freight International
John Flaherty, HTS Freight Logistics
Ian MacDonald, ShipNorthAmerica Transportation
Larry Cox, Polaris Transport Group
Eric Carusi, Transpro Freight Systems
On the outlook for freight brokers
Each of the brokers who participated in the discussion agreed on one thing: That it’s a great time to be a freight broker.
“These are exciting times. The business has never been better,” said Speranza. However, he noted many freight brokers will fail if they don’t keep their fingers on the pulse of the industry. But companies that adapt to the changing needs of their customers will thrive, he added.
Transpro’s Carusi agreed. “The growth is definitely there,” he said. “There is tons of opportunity there, but you need to understand (your customers’) problems and be proactive with solutions.”
“I think the market and the future looks good for brokers of all sizes,” added Flaherty. “I think being as proactive as you can be is always going to be important.”
MacDonald noted there are many carriers relying on freight brokers to fill trucks. “Without those carriers, we’d obviously be nowhere,” he acknowledged.
“There is always going to be opportunities for brokers in our industry,” Tittel said. With so much consolidation in the trucking industry, Tittel said freight brokers can act “almost like a guide” for shippers, familiarizing them with new entrants and keeping them apprised of the changing landscape.
However, Speranza was quick to point out freight brokers can’t rest on their laurels.
“If people don’t change, they’re going to be out of business in the next five years,” he warned. He said freight brokers should not focus on transactional selling, and instead offer a specialized service focused on adding value.
“Our business is transitioning to A-list customers looking for more of a boutique 3PL sell,” he said. “Selling freight on the phone every day and bidding on skids is not going to last here. It’s not going to work. Yes, there’s a market for that, but if you’re not growing, you’re falling behind.”
He said freight brokers that aren’t putting an action plan in place to reinvent themselves will not last.
“There’s a lot of business out there, but brokerages need to look at the value they’re actually providing to the client,” he said. “It needs to be more than ‘I can move those skids, here’s my price’.”
On building and maintaining relationships
Strong relationships will continue to be the foundation for success in the freight brokerage industry, experts agreed, but how those relationships are initiated and maintained is evolving. Face-to-face contact is being replaced with phone and e-mail communication, and monthly maintenance calls with customers are being done more like twice a year, MacDonald said.
Still, the freight brokers taking part in the discussion all agreed human relationships can’t be replaced with technology and that every freight broker should know who they’re dealing with.
Speranza suggested brokers meet with their top 20 carriers and build relationships with them. “You get better service that way,” he said. “Your customer is not just your client.”
Flaherty agreed with the need to develop strong relationships with carriers. “As brokers, we’re only as good as the service we get from the carriers,” he said.
Freight brokers participating in the discussion agreed technology is a useful tool to do away with nuisance calls (ie. “Did you get that fax I sent?) but that a human connection is still required.
“If it’s machine talking to machine, the business dies,” said Carusi.
MacDonald agreed. “If relationships and service from a personal standpoint weren’t important, then the whole business would be automated.”
“There are services like that and they haven’t done well,” Tittel added.
“Technology is a tool,” Flaherty said. “It’s an excellent tool that helps build relationships. We still need to talk with our customers and talk with our carriers.”
Successful freight brokers must also find a way to effectively communicate and build relationships with people of various ethnic backgrounds. It’s not just a middle-aged white guy’s world anymore, they acknowledged.
“You have to deal with people (from different cultures) on a different level,” Speranza said. “In the past we’d go to a hockey game or a ball game. Not everyone wants to do that, but that doesn’t mean they don’t have other things they’d like to do. Repect has got to be number one. You show them respect, they’ll show you respect.”
- Part 2 of this series will examine the sales evolution and the importance of technology.
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|Wednesday Dec 11, 2013 - Trucks moved a whopping 70 percent — $10 trillion — of nation’s goods in 2012
By CCJ Staff http://www.ccjdigital.com/
More than 70 percent of both the value and the weight of the freight moved in the 2012 calendar year trekked via truck, according to the U.S. Department of Transportation’s Bureau of Labor Statistics, who released its annual Commodity Flow Survey results this week.
Of the $13.6 trillion worth of goods moved last year, trucks carried $10 trillion of it (73.7 percent), according to the CFS. Tonnage wise, 11.7 billion tons of goods were shipped in 2012, with trucks carrying 8 billion of them.
The for-hire trucking industry carried 48.5 percent, $6.6 trillion, according to the CFS, while private trucks moved 25.2 percent of the total ($3.4 trillion).
However, when looking at ton-miles, rail accounted for 44.5 percent of freight movement and trucking accounted for 38.1 percent, according to the CFS. Ton-miles is a measurement of weight multiplied by distance shipped.
More than half of the total tonnage moved in 2012 went less than 50 miles, CFS says, and shipments traveling fewer than 250 miles accounted for more than 60 percent.
The CFS is only conducted every five years, with the first coming in 1993, and the subsequent ones coming in 1997, 2002, 2007 and last year. Final data from the survey will be released in December 2014, the DOT says.
- See more at: http://www.ccjdigital.com/trucks-moved-a-whopping-70-percent-10-trillion-of-nations-goods-in-2012/#sthash.Zpyn67Xn.dpuf
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|Wednesday Dec 11, 2013 - 35% of brokers have authority revoked in bond increase measure, broker group says
James Jaillet http://www.overdriveonline.com/
The number of freight brokers disappearing from the federal rolls has been increasing by the hundreds every day since Dec. 1, following the new requirement to carry a $75,000 bond, boosted from $10,000 by the MAP-21 highway funding act passed last year.
Today, 35 percent of brokers in business at the beginning of the month no longer have active authority, says James Lamb, president of the Association of Independent Property Brokers & Agents.
Beefing Up the Bond
Small brokers oppose proposed regs to increase the minimum bond to $100,000 and add other owner-operator protection.
As of noon, Dec. 10, 7,561 fewer authorized brokers were active than on Dec. 1, Lamb said, and that number will likely continue to rise until around Dec. 15 — 30 days after the last of the notices of investigation were sent to brokers by the Federal Motor Carrier Safety Administration. Overdrive reported last week on the decrease in brokers and AIPBA’s court fight against the bond increase. Click here to see it.
That number, however, could also include brokers who had their licenses revoked for reasons other than not complying with the bond increase, said Norita Taylor, spokesperson for the Owner-Operator Independent Drivers Association. She also said OOIDA hasn’t heard from any of its members about losing brokers.
FMCSA published a notice in September 2012 saying it would revoke operating authority from brokers who did not comply with the bond increase by Dec. 1, even though the MAP-21 bill required brokers to comply with the increase by Oct. 1.
Brokers are now required to carry a surety bond of $75,000 — up from the previously required $10,000. OOIDA supported the increase, saying it would better protect owner-operators who otherwise would not have been paid by over-extended brokers.
Taylor said the increase helps protect owner-operators from fraudulent brokers. “While most brokers provide a valuable service, the previous system left too much room for fraud where funds were collected from shippers but not paid to owner-operators.”
The American Trucking Associations and the Transportation Intermediaries Association also support the increase.
Because of the 60-day grace period and the time that brokers had to comply with the bond increase, Lamb says it’s “highly unlikely a significant amount” of the non-compliant brokers will be reinstated.
Broker numbers fall following bond increase, broker group appealing mandate
A broker trade association is appealing a new regulation that changed their minimum bond requirement from $10,000 to $75,000, which it says already has shut down 2,768 brokers not in compliance by Dec. 1 deadline.
The group is also still fighting the increase in court, Lamb says. Click here to read more about that lawsuit in previous Overdrive reporting.
Lamb says the next phase could push the number of brokers whose authority has been revoked as high as 75 percent. That phase, he said, would come after the “shaky” bonds some brokers purchased to remain compliant come up for renewal in a year.
He also said the industry would now be controlled by larger brokers, who will ask for higher rates, but will not pass those rates onto owner-operators. In fact, he said, they could restrict rates for owner-operators.
In previous Overdrive reporting, though, OOIDA’s Todd Spencer echoed Taylor’s comments, saying the bond increase will help truckers who “have been cheated by bad brokers out of” money they’re owed for hauling a load.
Overdrive covered the broker bond issue in an in-depth report last year, when the bond increase was tied to the highway funding act. Click here to read that story, which covers how it affects owner-operators and how it impacts brokers.
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|Tuesday Dec 10, 2013 - Man burned after falling into grain truck at Fort Worth brewery
By Claire Cardona
A man suffered burns on Monday after he fell into a grain truck at the Miller Brewing Co. in Fort Worth.
MedStar got a call around 8:28 p.m. that the man in his mid-40?s had fallen into a grain truck. CareFlite transported the man to Parkland Memorial Hospital where he is being treated for burns.
Brett Lyle, MedStar’s business development manager, said knowing the condition of the roads after the ice storm, transporting the man by air was the best choice.
His condition was not available.
View Original Article
|Tuesday Dec 10, 2013 - Creation of Freight Network Not an Easy Task
By Oliver Patton http://www.truckinginfo.com/
In last year’s highway bill, Congress said it wants the Department of Transportation to set a place for freight at the transportation policy table.
“It is the policy of the United States to improve the condition and performance of the national freight network to ensure that the national freight network provides the foundation for the United States to compete in the global economy,” the law says.
This first-ever recognition of freight’s central role in the national transportation system launched a multi-year effort by DOT to measure the scope and distance of goods movement, as a way to establish priorities and set goals.
The first step in that process, defining a highway-based Primary Freight Network, is under way now. The second step will be to determine Critical Rural Freight Corridors designated by the states, and to unite the primary network and the corridors into a National Freight Network. Ultimately this will lead to a National Freight Plan.
It turns out, though, that tracing a Primary Freight Network is not a simple thing.
Congress told DOT to build the network around eight pieces of information. They include the origin and destination of freight movements, tonnage and value of freight and the percentage of trucks in daily traffic on main roads. The network also should include land and water points of entry, access to energy exploration, population centers and connectivity.
The directions from Congress also said the network should be limited to 27,000 centerline miles, although that could be expanded to 30,000 miles if necessary.
This might look like a straightforward gathering of facts, but the Federal Highway Administration, the DOT agency in charge of the work, found that it’s actually pretty complicated.
The agency determined that it’s not possible to pack all of Congress’s requirements into a 27,000-mile, or even a 30,000-mile network.
For example, the agency said, thousands more miles are needed to come up with a network that links the primary segments with connections to Mexico and Canada. To stay within the limits, the agency would have to raise the thresholds on volume, value and tonnage used to designate network segments.
A more likely mileage number would be about 41,500, the agency said.
And that's not all
There are other challenges, as well, the agency said in a recent request for comments on its work.
Because Congress did not spell out its goals for the primary freight network, it’s hard for the agency to know where to draw the line.
“For example,” FHWA said, “a map that shows the top roads by percentage of truck traffic and a map that shows the top roads by average annual daily truck traffic yields very different results.”
Also, the requirement that the network be based on centerline roadway miles hinders the agency from including multimodal corridors, the agency said.
A complete network needs to include the entire freight transportation system, not just highways, the agency said.
The agency said it used the best data it has but the information is not good enough to trace all freight movements, particularly in the first and last miles between highways, rail yards, ports and major airports.
And the requirement that the network be based on centerline highway miles limits the agency’s ability to put urban freight into the mix. It would be helpful to let local, regional and state governments designate critical urban freight routes for the network, the agency said.
Heading the right direction?
Close followers of this issue in the freight community see FHWA’s proposed network as a reasonable beginning to what will be an extended process.
“What they have done at least for now appears to be headed in the right direction,” said Darrin Roth, director of highway operations for American Trucking Associations. He, like FHWA, is concerned about the lack of clarity from Congress regarding the purpose of the network.
“Without knowing what it’s supposed to be used for, it’s kind of hard to say whether it has to be connected,” he said. “Maybe it doesn’t.”
ATA has for a long time expressed concern about freight bottlenecks, and Roth lauded the agency’s effort to identify them on the network. What’s needed now is for Congress to provide dedicated funding to clear those choke points, he said.
He agrees with the agency that it would be helpful to take a multimodal approach to the network, but is cautious about one possible outcome.
If the point of the network is to target freight projects for money, it is important to make sure that the tax revenues collected from the various modes go the needs of those modes, he said.
“We would be very concerned if we were forced to subsidize non-highway modes,” he said.
He explained that the corridor approach to the network could identify the primary highway and then add on rail or water lines that parallel that service.
“If that were to happen you’d have a single network with all those modes and make money available to states out of the Highway Trust Fund for that entire multimodal network,” he said. “That’s something we would be concerned about.”
More than money distribution
Another stakeholder, Leslie Blakey of the Coalition for America’s Gateways and Trade Corridors, stressed that the network is not just about designating where federal dollars should go.
Blakey, whose group represents state transportation departments, Metropolitan Planning Organizations, ports and freight corridors, said the network also is about raising freight’s profile in national transportation policy. The freight distribution system supports manufacturing and retail in many different industries and is integral to national competitiveness, she said.
Too often in the past transportation policy has focused more on moving people. “I think that the point of this exercise is to take the blinders off (and) look at what the system looks like for goods movement,” she said.
Having that information will help inform decisions about public-private partnerships and other types of transportation investments.
“It would be a mistake to think of it only as a mechanism for distributing money. Really, it’s a process of trying to get the full spectrum of our freight system and orient our thinking around how our transportation network has to support this activity.”
It is clear, she noted, that Congress intends the network to be multi-modal. That was one of the key themes of a congressional panel’s recent report on freight, which recommended a comprehensive, multimodal approach to freight transportation.
Work on the network will continue through most of next year, with state recommendations for Critical Rural Freight Corridors due in the spring.
Ed Strocko of the Office of Freight Management and Operations at FHWA said he expects Congress will update its instructions on the network as the agency completes its work.
“When we put out our final notice we will talk about the issues,” he said. “We have kept (Congress) informed.”
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|Monday Dec 09, 2013 - NORTH CAROLINA TRUCKING COMPANY PUNISHED BY FMCSA
Trucking companies can be ordered off of the road until they address safety issues spotted by the Federal Motor Carrier Safety Administration.
December 07, 2013 /24-7PressRelease/ -- Recently, the Federal Motor Carrier Safety Administration (FMCSA) conducted its annual inspection check of commercial vehicles traveling on roadways throughout the United States. Several vehicles were ordered off of the road while they received the necessary repairs.
The FMCSA conducts safety operations year-round as part of its regulation of the trucking industry, and may revoke the operating certificate of some of the more serious offenders if widespread problems are found. The agency is responsible for developing new procedures that lead to a decrease in the amount of trucking accidents that occur each year.
The FMCSA announced that it has ordered a North Carolina trucking company out of service due to repeat safety violations observed by the agency. In its report, the FMCSA cited the company for a failure to maintain all of the vehicles in its fleet, and also for the company's lack in ensuring that its drivers were qualified. The company did not screen its drivers for alcohol or other drugs, and also ignored regulations concerning the number of hours that its drivers would be allowed to be behind the wheel.
This is the 11th company that the FMCSA has ordered off the road since January of 2013. The agency is being very aggressive in its pursuit of companies that it feels are the most dangerous offenders. Those companies must correct all of the issues before they will be allowed back on the road. Additionally, the agency has made it much more difficult for these owners and operators to simply reform their companies under different names, which has been a common practice in the past.
The FMCSA implemented a very rigid screening system after deaths of motorists in trucking accident had stayed relatively consistent for several years. It is hoped that by removing these vehicles from the roadways, it will help reduce the number of these deaths that occur each year.
For those motorists who have been involved in a trucking accident, they know that they can face a lengthy recovery period. These crashes generally result in catastrophic injuries for the occupants of regular-sized passenger vehicles, and often will require very expensive medical care.
If you have been injured in a truck accident or other type of motor vehicle crash, you may not know what to do. You will be receiving offers to settle your claims very soon after the accident, and you need to be extremely cautious at this time.
Speak to an experienced personal injury attorney to learn more about your particular situation. An attorney will be able to determine which parties are at fault, and then pursue claims against these individuals or entities. If your case ends up going into the courtroom, an attorney can ensure that you have someone on your side to protect your interests.
Article provided by Christina Rivenbark & Associates
Visit us at www.myncinjuryattorney.com
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|Sunday Dec 08, 2013 - The Government’s War on Long-Haul Truckers
Intrusive new regulations might actually make our highways more dangerous.
By Lee Habeeb and Mike Leven
Manuel Hernandez is not a complainer. But lately, he’s got a lot to complain about. Excessive government regulations are making it harder and harder for him to earn a living. And he’s not sure what he can do about it.
Hernandez is not an energy executive being hassled by the EPA, a banker trying to cope with Dodd-Frank, or a doctor getting nickel-and-dimed by HHS and Obamacare; he’s a long-haul trucker. And his story is one all Republicans running for office should know, because it personifies our government’s war against a large category of middle-class workers who make our economy hum.
Readers of the Wall Street Journal met Hernandez in his truck somewhere on Interstate 10 between El Paso and Los Angeles, thanks to a superb piece of reporting by Betsy Morris last week. This first sentence caught every reader’s attention: “Manuel Hernandez is one of a vanishing breed: a professional long-haul trucker.”
Long-haul truckers are vanishing? Is there someone protecting this endangered species? God knows we have enough people fighting for the survival of the dunes sagebrush lizard.
We soon learned why this breed of middle-class worker is vanishing, and we learned more about the 50-year-old Hernandez, too. Like many truckers, he loves what he does, especially squeezing his 18-wheeler into tight spaces. He’s a guy who doesn’t get his fashion tips from GQ and never once dreamed of landing that big corner office. His office is the rig he works in every day, accompanied by a whole lot of horsepower and thousands of miles of open road.
Hernandez’s story got more interesting a bit farther down in the article, as we learned how public policy dictated by bureaucrats in Washington, D.C., was affecting his life — and the lives of all long-haul truckers — for the worse: “Lately, though, Mr. Hernandez’s patience has been worn thin by a confusing tangle of rules, efficiency directives, and electronic devices that cap his speed, log his every move, and practically try to autopilot his truck. Magnifying the stress are more federal rule changes that took effect in July and are now roiling the industry.”
The federal agency that is doing all this is the Federal Motor Carrier Safety Administration (FMCSA), an agency within a bigger agency, the Department of Transportation.
Under a revised rule by the FMCSA’s trucking czars, the average workweek for men and women who make a living carting around America’s stuff was shortened to 70 hours from 82. But that wasn’t the only change. It turns out the required 34-hour break between workweeks must now extend over two nights, including the hours between 1 a.m. and 5 a.m., according to Betsy Morris’s article.
The micromanaging of what truckers can and can’t do is nothing new, but adding this new set of rules to lots of old rules — particularly one that limited truckers to no more than eleven hours of driving in a day, with a required rest of ten consecutive hours — has cost Hernandez and truckers like him dearly.
Why the changes? Has there been a spike of trucking accidents involving sleepy drivers?
Actually, no. Crashes involving large trucks declined 26 percent between 2000 and 2011. It turns out that the rule changes were the result of a decade of litigation against the FMCSA by safety advocates and plaintiff lawyers pushing for tougher driving laws.
What was supposed to be the upside to the changes foisted by the FMCSA on already-overregulated truckers like Manuel Hernandez? The agency predicts the new rules will prevent about 1,400 crashes and 560 injuries and save 19 lives a year.
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|Sunday Dec 08, 2013 - For-hire enjoys best-hiring month since April
Less cheering: New GDP rise is pinned to swollen inventories
Dec. 6, 2013David Cullen | Fleet Owner
Of the 203,000 jobs added to the economy last month, as reported today by the Dept. of Labor’s Bureau of Labor Statistics (BLS), some 8,400 were for positions in for-hire trucking— notching the best employment month for the segment since April.
What’s more, per the BLS Current Employment Statistics Highlights report, in November the unemployment rate fell from 7.3% to 7.0%. BLS said employment increased in transportation and warehousing as well as in health care and manufacturing.
“Truck transportation added 8,000 jobs in November,” stated BLS. However, that number may actually surpass 8,400, the number pegged by Bob Costello, chief economist & vice president of the American Trucking Assns. Costello pointed out to FleetOwner that “ATA goes on our figures, which come from BLS.”
BLS further observed about the November performance by for-hire trucking that “since the most recent employment trough in March 2010, the industry has added 161,000 jobs.”
Costello said the drop in the unemployment rate— now at its lowest level in five years— was “due to solid job growth, not people leaving work force” and a “very positive sign” for the economy.
BLS also reported that the change in total nonfarm employment for September was revised up by 12,000 (from +163,000 to +175,000) and that the employment change for October was revised down by 4,000 (from +204,000 to +200,000).
“Employment in transportation and warehousing rose by 31,000 in November,” the agency noted, “with gains in couriers and messengers (+9,000), truck transportation (+8,000), warehousing and storage (+5,000), and air transportation (+3,000).”
The other big economic news this week came yesterday, when the Commerce Dept. reported that GDP increased at an annual rate of 3.6% in the third quarter, according to what it termed the "second” estimate released by its Bureau of Economic Analysis (BEA).
“The acceleration in real GDP growth in the third quarter primarily reflected an acceleration in private inventory investment, a deceleration in imports, and an acceleration in state and local government spending that were partly offset by decelerations in exports, in personal consumption expenditures, and in nonresidential fixed investment,” noted BEA in a news release.
However, ATA’s Costello cautioned against viewing this news too positively—pointing out the revision was due to higher inventories built up by businesses.
“These higher inventories aren’t good because shippers will work off any excess inventories before ordering more products,” he told FleetOwner. And that hurts truck-freight volumes. It is likely one of the reasons why October freight was off, once adjusted for typical seasonality.”
Costello said inventories did not pile up “on purpose,” but said the situation was “most likely caused by weaker sales than expected. I suspect the drawdown has already started as October truck freight was weaker than anticipated (seasonally adjusted).”
Indeed, Lindsey Piegza, managing director & chief economist of brokerage firm Sterne Agee, observed in an email that while third-quarter GDP was revised up from the preliminary estimate of 2.8% to 3.6%, “the underlying story does not change.
“Headline [a basic rate before distorting factors have been removed] growth was led by [a] surge in inventories-- larger than previously reported-- while consumption continued to wane and business remained sidelined,” she continued. “The surge in inventories accounted for 1.68%, or nearly half of headline growth in the third quarter.”
On the other hand, Peizga pointed out that personal consumption was revised down from 1.5% to 1.4% in Q3. She said that contributed less than 1% to the headline number-- reinforcing the declining trend in consumption since the start of the year.
“As we saw with the initial GDP release,” Piezga pointed out, “headline growth was impressive thanks to an inventory stockpile. However, overzealous production last quarter is likely to severely contract from the current quarter's growth.
“Given the fragile consumer sector and tepid business investment,” she advised, “end of the year growth is unlikely to push above 2%.”
View Original Article
|Friday Dec 06, 2013 - Nearly 2,000 brokers lose operating licenses following warning notice on higher surety bond limits
Mark B. Solomon
Nearly 2,000 property brokers have lost their operating authority this week after failing to comply with a new Congressionally mandated increase in surety bonds used to pay claims by truckers for late payment or nonpayment for their services, according to a carrier marketing website.
The license revocation process began Dec. 2 after the expiration of a 60-day grace period established by The Federal Motor Carrier Safety Administration (FMCSA) for brokers to comply with the higher limits. FMCSA, a unit of the Department of Transportation, oversees the operations of freight brokers, among other tasks. The data came from My Carrier Resources, a Platte City, Mo.-based company run by Michael J. Curry, who said he has 37 years of transportation experience, 30 of them as a broker. Curry said he obtained the information on the revocations from the FMCSA website.
Language incorporated in the 2012 law re-authorizing the nation's transportation funding programs required brokers to post a $75,000 surety bond to guarantee payment to motor carriers if the broker fails to make good. The previous bond amount had been $10,000.
It is unclear how many brokers voluntarily surrendered their licenses versus how many had their authorities revoked. Warning notices to affected brokers were sent starting Nov. 1. These notices informed brokers that their authorities would be pulled if they didn't demonstrate compliance, according to Curry.
Notices were sent to approximately 9,000 brokers starting Nov. 1 and continuing from Nov. 4 through Nov. 8, Curry said. On Monday, 1,900 brokers had their operating authorities revoked, he said. That was followed by 22 on Tuesday, and 855 yesterday, Curry said. As of mid-day today, the FMCSA site reported three revocations, all of them voluntary, Curry said. The revocation period from the November round of notices is set to run until Dec. 10, Curry said.
Brokers would be eligible for reinstatement if they meet the higher bonding requirements, Curry said. It is estimated that there are 21,000 property brokers operating in the United States.
The battle over the bonding levels has pitted the Transportation Intermediaries Association (TIA), the Owner-Operators Independent Drivers Association (OOIDA), and the American Trucking Associations against independent broker interests represented by the Association of Independent Property Brokers & Agents (AIPBA). Independent broker advocates said thousands of brokers unable to either come up with the higher upfront payment or obtain a bank letter of credit attesting to the availability of funds would be driven out of business or become agents of larger brokers. They also accused TIA of trying to corner the market on surety bond underwriting, a claim TIA has denied.
Supporters of the higher bond levels have argued that the increase was reasonable because the $10,000 threshold had remained in force for 30 years. They also maintained that it was part of a broader effort to ensure that the brokerage segment, which has long had a reputation for shady activity, would be populated by ethical, well-run, and well-capitalized firms.
AIPBA had been willing to agree to a $25,000 surety bond threshold as an inflation-cost adjustment. Carrier interests, meanwhile, were seeking bond levels well into six figures.
Last week, a federal appeals court in Atlanta denied an AIPBA request for a temporary stay of the FMCSA's action.
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