Truck Dealers Seek Incentives to Spur Sales During Meeting With Obama Administration

This story appears in the Sept. 6 print edition of Transport Topics.

Several trucking industry officials met with the Obama administration Sept. 1 to push for incentives for fleets to buy new equipment, arguing that sales are lagging because of high truck prices caused by federal emissions rules.

The group, led by American Truck Dealers, met with Ron Bloom, the Obama administration’s senior counselor for manufacturing policy.

The trucking group, which has been pushing for some form of tax incentive, also sought measures such as changing export rules to increase the sale of new trucks.

The group had sent Obama a letter July 20 that stated, “Despite significant progress in research and development and advanced technologies, the trucking industry is struggling from a lack of demand for new commercial trucks.”

Kyle Treadway, ATD chairman, said the group told Bloom, “The price of equipment is prohibitive for our customers and is a direct result of emissions technology.”

The price of new Class 8 trucks increased by as much as $7,000 to $10,000 this year to meet the latest U.S. Environmental Protection Agency mandates, following price increases in the $10,000 range to meet 2007 emissions requirements, manufacturers have said.

“We also have issues with safety equipment, which has also increased the cost of equipment,” Treadway told Transport Topics. “We’re not seeing all this technology adopted by the industry because of the cost.”

Treadway said that rather than buying new equipment, fleets are extending the service life of older vehicles. “It is in all of our interests to incentivize new equipment,” he said.

Patrick Charbonneau, vice president of government relations for truck and engine maker Navistar Inc., sought assistance in increasing exports.

Charbonneau told TT that truck makers are inhibited from exporting U.S. trucks to a number of countries that accept only European Union emissions standards.

“We’d like the administration to work on a country-by-country basis to have U.S. standards accepted as well,” he said.

In addition to Charbonneau of Navistar, Volvo Trucks North America sent a representative to the meeting. Other manufacturers did not respond to requests for information.

The Owner-Operator Independent Drivers Association also sent a representative.

Treadway said the basis for discussion was an ATD proposal in January requesting an investment tax credit of 10% of the price of new Class 8 trucks for qualifying new technology 2010 engines and a “green voucher” of $6,000 for Classes 6-7 trucks.

“We didn’t bring any written proposal to this meeting,” Treadway said. “While we didn’t get down to specifics, we were unified as a group that we need something to spur sales of new equipment, and we positioned this meeting as the beginning of a dialogue with the administration.”

“The meeting went very well. It was very positive, and I’m very pleased,” Treadway said. In a Treasury Department statement, Bloom said, “We had a good discussion and agreed to continue the dialogue.”

Treadway said ATD also is exploring programs with members of Congress.

He said the ATD board of directors met July 29 with Rep. Earl Blumenauer (D-Ore.), a member of the tax-writing House Ways and Means Committee.

In an Aug. 5 letter to Blumenauer, ATD said, “Your proposal to stimulate sales of new trucks through a revenue-neutral swap of truck retail federal excise tax for an increase in the diesel tax was very well-received.”

Blumenauer’s office did not return calls for comment.

American Trucking Associations, which has said it would support fuel-tax increases only if they are directed at infrastructure improvement, said Sept. 1 that the federation “currently has no policy relating to the exchange of the truck retail federal excise tax [FET] for an increase in the federal tax on diesel.”

“The ATA policy committees will address this issue when they meet in September in preparation for the annual Management Conference & Exhibition,” ATA said. “The committees may offer recommendations to ATA’s Board of Directors at MC&E in October.”

ATA also said, “A program involving the FET and federal fuel tax must retain robust funding for the Highway Trust Fund to ensure the continuation of vital highway infrastructure projects that create jobs and improve supply-chain efficiency, and should not jeopardize efforts to increase revenue available for highway improvements.”