ATA Special: COVID-19 Update. FMCSA Emergency Declaration Pending

Dear Arizona Trucking Association Members:

It is our understanding that after the President’s address earlier today, that FMCSA will be issuing and emergency declaration that will extend Hours of Service. At this point, we do not know to what extent HOS will be affected, so please take caution to read the text of the emergency declaration once it is officially published. (See Emergency Declaration Information below.)

The official publication of the emergency declaration will be found on FMCSA’s website here: https://www.fmcsa.dot.gov/emergency-declarations

We have been in touch with the Arizona Governor’s office and the Department of Public Safety and it is my understanding that Arizona will likely adopt the declaration once it is issued by FMCSA.

We will attempt to provide you with additional information as it becomes available.

Sincerely,

Tony Bradley
President and CEO
Arizona Trucking Association

P.S. Please follow us on www.facebook.com/aztrucking or www.twitter.com/aztrucking to get the latest information.

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Emergency Declaration Information

To provide vital supplies and transportation services to a disaster area in the United States, emergency declarations may be issued by the President, Governors of States, or FMCSA. These declarations trigger the temporary suspension of certain Federal safety regulations, including Hours of Service, for motor carriers and drivers engaged in specific aspects of the emergency relief effort. See 49 CFR 390.23 for the actual emergency regulation.

Relief from Federal Motor Carrier Safety Regulations is limited to a maximum of 30 days, unless extended by FMCSA itself.

The information below reflects currently available relief:

1. Drivers responding to provide “direct assistance” to an “emergency” meeting the definitions in 49 CFR 390.5 and declared by FMCSA or a governor, are exempt from applicable regulations in all States on their route to the emergency, even though those States may not be involved in the emergency or stated in the declaration of emergency.
2. These exemptions, when in effect, only apply to 49 CFR Parts 390-399. They do NOT exempt drivers/carriers from the requirements relating to CDL, drug/alcohol, hazardous materials, size & weight, or State/Federal registration and tax requirements. (However, a Governor’s Declaration may add some of those exemptions – read the declaration for details.)
3. Even if an Emergency Declaration is still in effect, the emergency must be on-going and you must be providing direct emergency assistance in order to be exempt from safety regulations.
4. The list of Emergency Declarations below may not be complete. Declarations may be in effect even if not listed here. Read the declaration itself for all details.
5. There is no requirement to carry a copy of the declaration in the vehicle unless stated so in the declaration itself.
6. Drivers and carriers should coordinate with State emergency officials before providing assistance. State regulations regarding size and weight, permits, taxes, etc. may not have been waived.
7. Even though safety regulations may be suspended, drivers and carriers are expected to use good judgment and not operate vehicles with fatigued or ill drivers, or under any conditions presenting a clear hazard to other motorists using the highways.

We also want to share with you this information that has recently been received from our partners at the American Trucking Associations:
 
Economic Update:
A few key notes from ATA Chief Economist Bob Costello are below.

• Freight volumes of staples, like bottled water and non-perishable foods, are surging because Americans are stockpiling in case we are quarantined for an extended period. However, this spike will be short lived and there will be payback in softer volumes for these goods later.
• Volumes at the ports, particularly the West Coast ports, are plummeting. So far this quarter, 58 ship sailings from China have been canceled. Compare that to a year earlier when the trade war was raging when 33 were canceled.
• In China, travel restrictions have prevented many workers from returning to work – they are easing some of these restrictions, but apparently travel is still difficult. As a result, labor shortages are holding back Chinese production levels. And even when they are producing goods, the supply chain is not back up to normal and some of the products aren’t getting to the seaports for export. Many truck drivers are not back to work there. This is important because many Chinese goods are inputs to US manufactured goods.
• In the US, the travel and hospitality industry are getting pummeled from canceled business and personal trips. According to the US government, US travel and tourism is nearly 10% of GDP, so it is a significant industry. The reduction in travel will lead to fewer truck freight volumes for this industry.
• A few economists are now saying that the US is in a recession. Even for those that aren’t (yet), many are forecasting very little GDP growth this quarter (<1%) and a negative reading next quarter. I still think it is too early to make that call, but the trends are pointing in that direction.
• The EU just waved the requirement that budget deficits cannot exceed 3% of GDP. That means not only Italy, but the entire continent can do a large-scale fiscal stimulus.  The Germans, who have a budget surplus, are expected to do a large fiscal response as well.
• Depending on the product, China production was delayed anywhere from 3 to 12 weeks. Chinese manufacturing is running at 50% to 90% depending on the industry.
• There is a hangover effect that will take a while to overcome – to get containers back to China, it could take up to June to get all the containers needed back to China.
• Estimate 3.8m vehicle sales wiped out due to COVID-19 in 2020 alone, worldwide.