Amidst the uncertainty and speculation about the policies of the impending President-elect Trump administration, one of the sectors that is hopefully optimistic is West Coast trucking companies. As previous years saw sporadic spending on highway infrastructure projects and proposed safety regulations, President-elect Trump had made rolling-back regulations and increased spending on roads and bridges and creating jobs a key talking-point of his election campaign.
“We are going to fix our inner cities and rebuild our highways, bridges, tunnels, airports, schools, hospitals,” Trump said during his victory speech. “We’re going to rebuild our infrastructure, which will become, by the way, second to none. And we will put millions of our people to work as we rebuild it.”
Big Promises, Lingering Questions
According to the Chicago Tribune, Trump and his campaign promised to pump $1 trillion into American infrastructure over the next 10 years. While this has many excited about the prospect, some experts – like Noël Perry, an analyst at research firm FTR Transportation Intelligence – are wondering where this money will come from.
“We have to find a way to pay for these projects,” Perry told Trucks.com. “Trump made it clear during his campaign that he wasn’t going to increase the deficit to pay for infrastructure projects. The trucking industry shares the highway, so we have to pay our fair share.”
Trucking Meets with Transition Team
As part of this exploration of the logistics of making good on the campaign’s promises, the American Trucking Association, the largest group representing trucking companies in Washington, met with members of Trump’s transition team early in November. According to the Wall Street Journal, ATA chief Chris Spears issued a statement that the group hopes to work “closely with the new administration on issues that will allow the trucking industry to continue to grow and move America forward.”
Rolling Back Regulations
In addition to increased spending, many within the trucking industry and excited at the prospect of some of the more restrictive regulations that have been proposed or put in place in recent years being rolled back by the Trump administration. These regulations have been considered by many to be an obstacle to healthy logistics and transportation growth, with some of the proposals of the Obama administration being met with particular resistance.
“We certainly think the regulatory onslaught that’s targeting trucks needs a review,” Todd Spencer, an executive vice president at the Owner-Operator Independent Drivers Association, told the Wall Street Journal. Several of the proposed safety regulations – including a Department of Transportation plan to make trucks that weigh more than 26,000 pounds be equipped with electronic devices that would cap their top speed and hours-of-service rules limiting driving hours – are now considered likely to be scrapped.
Privatized Roads and Infrastructure
One of the most significant promises of the Trump administration that could impact west coast trucking companies is the introduction of certain elements of privatization to support infrastructure. Trump’s plan involves an adjustment of existing tax code to incentivize private investment in public projects with an 82 percent tax credit on equity invested in infrastructure paired with federally-subsidized loans at a 5-to-1 leverage ratio. The administration is considered to be in favor of increased participation by for-profit businesses in public infrastructure projects.
A Positive Economic Outlook
In all, despite the haziness of certain details, experts within the trucking industry are cautiously optimistic about the outlook facing trucking companies. Combined with an energy policy focusing on keeping oil production up and fossil fuel prices low, the increased spending and relaxed regulations are expected to give the trucking sector of the economy a jolt.
“Trucking companies may be better off in 2017,” Perry said. “As we enter 2017, expectations are low and the economy is likely to be better than expectations, as least for the first half.”