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27 TABLE 26 Trucking firms by geographic region, 2000 Other 0.07% Mexico 0.68% Number of Trucking Firms West 14% Canada 3% Region All For Hire West 70,471 41,414 Northeast 19% Midwest 147,687 61,358 South 177,734 81,735 Northeast 97,450 35,385 Canada 13,904 8,960 Midwest 29% Mexico 3,476 2,822 Other 363 151 South 35% Note: This table excludes 595 firms with equal-sized bus and trucking operations and 101,686 firms with unknown geographic information. Source: FCMSA MCMIS, 2000. Note: A total of 511,085 firms is represented. This chart excludes 595 firms with equal-sized bus and trucking operations and 101,686 firms with unknown geographic information. Source: FMCSA MCMIS, 2000. pose most of the industry. The "other" category includes other Figure 27. Distribution of trucking firms by specialized carriers such as heavy equipment carriers and geographic region, 2000. building materials carriers. SAFETY ECONOMY AND FINANCES This section presents fatality, injury, and crash statistics for crashes involving large trucks. Although statistics derived This section presents economic and financial information from the MCMIS database do not provide complete cover- on the trucking industry, including sources of revenues, fac- age for significant numbers of intrastate motor carriers, the tors affecting profitability, driver compensation, operating statistics from NHTSA's Fatality Analysis Reporting Sys- expenses, operating cost per mile, trends in truck sales and tem (FARS) are regarded as true population totals (interstate registrations, trends in revenue, trends in intercity ton-miles, and intrastate) and statistics from the National Automotive trends in business failures, and distribution of revenue within Sampling System's General Estimates System (GES), which the industry. reports crashes, are estimated for the entire vehicle popula- tion based on a representative national sample. Expenses and Revenues Table 28 shows that fatalities and injuries have remained roughly constant over the past decade, while the number of Table 29 shows the 20 largest trucking operators in terms crashes and vehicle-miles traveled, have increased. As a result, of revenue in 2001, based on data from the Bureau of Trans- the fatality rate, the injury rate, and the crash rate per 100 mil- portation Statistics. Dividing operating expenses by operat- lion vehicle-miles traveled (VMT) have all declined, as shown ing revenues shows the operating ratio. The higher the ratio, in Figures 29, 30, and 31, respectively. expressed in percentages, the smaller the trucking operator's TABLE 27 Trucking firms by segment and fleet size, 2000 Fleet Size Private For Hire Government Other Unknown 26,626 57,825 676 1,317 1000+ 96 124 3 1 500-999 113 190 1 8 100-499 1,194 1,743 32 51 50-99 1,752 2,460 45 68 25-49 3,983 5,087 73 152 10-24 15,132 14,578 265 529 6-9 19,579 14,220 247 579 2-5 108,797 67,786 1,791 3,215 1 140,088 125,637 2,915 6,934 Total 317,371 289,650 6,048 12,854 Percentage of firms offering service 52% 47% 1% 2% Note: This table excludes 595 firms with equal-sized bus and trucking operations. Totals in this table do not sum to industry counts since carriers can be classified in multiple categories. Source: FCMSA MCMIS, 2000.

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28 Other 26.7% Truckload 43.6% Bulk 3.9% Household Goods 3.7% Refrigerated 7.3% Tank 5.2% Less-Than-Truckload 9.7% Note: Derived from reports filed with the U.S. Department of Transportation by carriers with $3 million or more in annual revenue. Source: American Trucking Associations, Inc., American Trucking Trends 2003. Figure 28. Distribution of for-hire interstate carriers, 2000. TABLE 28 Fatalities, injuries, and crashes in large truck-involved crashes, 1991 to 2002 Year Fatalities Occupant Fatalities Injuries Crashes Vehicle-Miles Traveled 1991 4,821 661 110,000 330,347 149,543,000 1992 4,462 585 139,000 376,035 153,384,000 1993 4,856 605 133,000 397,328 159,888,000 1994 5,144 670 133,000 460,644 170,216,000 1995 4,918 648 117,000 377,472 178,156,000 1996 5,142 621 130,000 393,755 182,971,000 1997 5,398 723 131,000 437,917 191,477,000 1998 5,395 742 127,000 411,955 196,380,000 1999 5,380 759 142,000 474,920 202,688,000 2000 5,282 754 140,000 456,995 205,520,000 2001 5,111 708 131,000 429,823 209,032,000 2002 4,897 684 130,000 434,542 214,530,000 Source: NHTSA, Traffic Safety Facts 2002. Fatalities (Indexed to 1991) 1.2 1.1 1.0 Fatalities 0.9 Fatalities per 100 million VMT 0.8 Occupant Fatalities Occupant Fatalities 0.7 per 100 million VMT 0.6 1991 1993 1995 1997 1999 2001 1992 1994 1996 1998 2000 2002 Year Source: NHTSA, Traffic Safety Facts 2002. Figure 29. Fatality Index and Fatality Rate Index for large truck-involved crashes, 1991 to 2002.

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29 Injuries (Indexed to 1991) 1.4 1.3 1.2 Injuries 1.1 Injuries per 1.0 100 million VMT 0.9 0.8 0.7 0.6 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Year Source: NHTSA, Traffic Safety Facts 2002. Figure 30. Injury Index and Injury Rate for large truck-involved crashes, 1991 to 2002. profit margin. In 2001, United Parcel Service, Inc., had the (LTL) freight account for over 75 percent of revenues. The greatest operating revenue of any motor carrier of property, figure applies only to for-hire trucking firms with over $3 mil- $20.3 billion, while its operating ratio was 95 percent (i.e., lion in annual revenue and may not accurately represent the UPS's operating expenses were equal to 95 percent of its oper- for-hire sources of revenue for small trucking operators. ating revenues). Roadway Express, Inc., was second, with $2.7 billion in operating revenues and an operating margin of 97 percent. Combined, the top 20 carriers had operating rev- Factors Affecting Profitability enues of $45.3 billion and operating expenses of $41.6 bil- ATA cites the following factors as affecting the profitabil- lion, for an operating ratio of 92 percent. ity and productivity of the trucking industry: Sources of Revenues Rising equipment rental costs; Rising insurance costs; Figure 32 shows the sources of revenue for the for-hire National driver shortages; trucking industry. General truckload and less-than-truckload Rising fuel costs; and Crashes (Indexed to 1991) 1.5 1.4 1.3 1.2 Crashes 1.1 Crashes per 100 million VMT 1.0 0.9 0.8 0.7 0.6 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Year Source: NHTSA, Traffic Safety Facts 2002. Figure 31. Crash Index and Crash Rate Index for large truck-involved crashes, 1991 to 2002.

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30 TABLE 29 Top 20 trucking operators by operating revenue, 2001 Operating Operating Operating Rank Company Revenues ($) Expenses ($) Ratio 1 United Parcel Service, Inc. 20,273,055,000 19,308,181,000 95% 2 Roadway Express, Inc. 2,671,186,000 2,585,392,000 97% 3 Yellow Transportation Inc. 2,522,297,000 2,419,462,000 96% 4 J. B. Hunt Transport, Inc. 2,247,886,000 2,028,095,000 90% 5 Swift Transportation Company, Inc. 2,101,472,000 1,318,392,000 63% 6 Con-Way Transportation Svc, Inc. 1,935,212,000 1,725,953,000 89% 7 Ryder Integrated Logistics, Inc. 1,553,529,000 1,567,751,000 101% 8 Werner Enterprises, Inc. 1,341,456,000 1,191,190,000 89% 9 Overnite Transportation Company 1,332,520,000 1,202,966,000 90% 10 ABF Freight System, Inc. 1,255,827,000 1,182,635,000 94% 11 United Van Lines, LLC 1,113,826,000 796,652,000 72% 12 New Bern Transport Corp. 1,044,779,000 929,526,000 89% 13 USF Holland, Inc. 960,392,000 862,150,000 90% 14 Estes Express Lines 796,479,000 627,659,000 79% 15 Watkins Motor Lines, Inc. 793,090,000 745,564,000 94% 16 U.S. Xpress, Inc. 762,939,000 723,767,000 95% 17 Landstar Ranger, Inc. 713,337,000 617,634,000 87% 18 Penske Logistics, LLC 672,558,000 616,143,000 92% 19 North American Van Lines, Inc. 581,881,000 645,001,000 111% 20 Averitt Express, Inc. 581,854,000 526,025,000 90% Total 45,255,575,000 41,620,138,000 92% Note: Includes intercity regular route carriers, defined as carriers whose revenue from intercity regular routes exceeds revenue from all other types (local, commuter, charter) combined. Source: Bureau of Transportation Statistics, Motor Carrier Financial and Operating Statistics. Government regulations, including hours-of-service Pass a physical examination every two years (if engaged changes. in interstate commerce); Be 21 years of age (if engaged in interstate commerce); Submit to random drug and alcohol testing; Have no criminal record involving drunk driving, drug Driver Qualifications for Employment use, or hit-and-run driving; Speak English well enough to read road signs; and The basic qualifications for employment as a truck driver Pass an FMCSA written exam. are as follows: Obtain a Commercial Driver's License if operating a Driver Compensation vehicle with a gross vehicle weight rating (GVWR) of 26,001 pounds or more or of any size transporting haz- The Bureau of Labor Statistics' Occupational Outlook ardous material; Handbook, 2004-2005 Edition reports a median truck driver Other 11% Bulk 2% Refrigerated 4% Household Goods 5% Tank 2% General Truckload 46% General Less-Than-Truckload 30% Note: Derived from reports filed with the U.S. Department of Transportation by carriers with $3 million or more in annual revenue. Source: American Trucking Associations, Inc., American Trucking Trends 2003. Figure 32. For-hire trucking industry sources of revenues, 2001.

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31 hourly wage of $15.97 for long-haul trucks heavier than Driver Regulations 26,000 pounds, and a median truck driver hourly wage of $11.48 for local and regional trucks equal to or lighter than Truck drivers are subject to a number of FMCSA regula- 26,000 pounds. Generally, local drivers are paid hourly with tions, which include but are not limited to the following: overtime and long-distance drivers are paid by the mile. On a per-mile basis, ATA estimated driver wages in 2001 at Hours-of-service (HOS) regulations--New HOS reg- $0.39 per mile. ulations (in effect January 2004) apply to employees of private operators, but not government operators. The Driver Work Schedules new regulations stipulate that a driver may not drive: More than 11 hours, following 10 hours off duty; Truck drivers may work up to 70 hours per week, and up Beyond the 14th hour after coming on duty, fol- to 14 or 15 hours per day. They drive 10 or 11 hours per day. lowing 10 hours off duty; and Their daily schedule fluctuates and is dictated by delivery After 60/70 hours on duty in 7/9 consecutive days. times, pick-up times, unscheduled delays, team driving, etc. Medical standards and physical qualifications--Apply Local drivers may start early in the morning or late at night only to employees of private companies, not employees to avoid traffic. Quality of rest for local drivers is consistent, of government-owned operations. since it is almost always obtained at home. Quality of rest for Drug and alcohol testing--Applies to all drivers of vehi- long-distance truckers is variable, since it is obtained mostly cles with a GVWR of 26,001 pounds or more or drivers in sleeper berths at rest stops, roadside, or while the vehicle of any size vehicle transporting hazardous material. is in motion (team driving). Long-distance drivers may work Commercial Driver's Licenses--Are required of all in pairs on "sleeper" runs that last for days or weeks. drivers of vehicles with a GVWR of 26,001 pounds or more or drivers of any size vehicle transporting hazardous Driver Duties material. The duties of a truck driver typically include, but are not limited to, the following: Operating Expenses Inspect the truck before leaving the warehouse or terminal; Figure 33 shows the distribution of operating expenses for Make sure cargo is secure; trucking firms in 2001. American Trucking Associations, Be alert when driving in order to prevent crashes; Inc., used data from the Motor Annual Carrier Report, which Load and unload cargo as required; are based on information filed for carriers making at least Take orders, collect payments, sell goods, solicit new $3 million in annual revenue, excluding household goods car- orders, or perform other customer service duties as riers. As a result, the distribution of operating expenses may required; and not be representative of small trucking companies that com- After delivery, complete a report detailing the trip. pose most of the industry. Taxes and Licenses 2% Insurance 3% Depreciation and Amortization 5% Miscellaneous 8% Operating Supplies and Expenses 14% Salaries/Benefits 41% Equipment 27% Note: Derived from reports filed with the U.S. Department of Transportation by carriers with $3 million or more in annual revenue. Source: American Trucking Associations, Inc., American Trucking Trends 2003. Figure 33. Distribution of operating expenses for large trucking firms, 2001.

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32 Operating Cost per Mile TABLE 30 Operating cost per mile for large trucking firms, 2001 Table 30 shows the operating cost per mile for trucking Cost Element Cost per Mile firms in 2001. American Trucking Associations, Inc., used Equipment Rents and Purchased Transportation $0.56 data from the Motor Carrier Annual Carrier Report, which Driver Wages $0.39 are based on information filed by carriers making at least Other Wages and Benefits $0.47 Fuel $0.17 $3 million in annual revenue, excluding household goods Depreciation $0.10 carriers. As a result, the operating cost per mile may not be Insurance $0.06 representative of small trucking companies that compose Outside Maintenance $0.06 most of the industry. Taxes and Licenses $0.03 Tires $0.02 Miscellaneous $0.21 Total $2.07 Truck Sales Source: American Trucking Associations, Inc., American Trucking Trends 2003. Table 31 and Figure 34 show retail sales of large trucks since 1992 for both interstate and intrastate use. Sales peaked Truck Registrations in 1999 at nearly 644,000 and have declined every year since. In 2002, a total of about 402,000 large trucks were sold in the Table 32 and Figure 35 show the estimated truck registra- United States. New trucks are generally retailed at approxi- tions for 1999 to 2001, for both interstate and intrastate use. The mately $100,000 to $150,000. However, there is a very active American Trucking Associations used the Federal Highway used-truck market where trucks are sold for a much wider Administration's 2001 Highway Statistics and the 1997 Vehi- price range. cle Inventory and Use Survey (VIUS). Although large truck TABLE 31 Large truck retail sales by class, 1992 to 2002 Year Class III Class IV Class V Class VI Class VII Class VIII Total 1992 25,500 25,600 3,600 27,700 73,200 119,100 274,700 1993 26,900 33,300 4,300 26,600 80,800 157,900 329,800 1994 35,300 44,500 4,100 20,300 98,200 185,700 388,100 1995 39,900 52,600 4,300 23,300 106,700 201,300 428,100 1996 51,800 58,700 7,300 19,400 103,500 170,100 410,800 1997 52,800 56,500 9,200 18,100 110,700 178,600 425,900 1998 102,500 43,400 25,200 31,600 114,700 209,500 526,900 1999 122,400 49,400 30,400 48,100 131,000 262,300 643,600 2000 116,300 47,400 29,100 51,200 122,600 211,500 578,100 2001 101,500 52,000 24,400 42,400 91,600 139,600 451,500 2002 80,000 37,800 24,000 45,100 69,300 146,000 402,200 Source: American Trucking Associations, Inc., American Trucking Trends 2003. Sales (in Thousands) 700 600 500 400 300 200 100 0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Year Source: American Trucking Associations, Inc., American Trucking Trends 2003. Figure 34. Total large truck retail sales (Classes III through VIII), 1992 to 2002.

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33 TABLE 32 Estimated truck registrations, 1999 to 2001 (Millions) Year Commercial Trucks Truck-Tractors Total 1999 21.268 1.531 22.799 2000 22.306 1.588 23.894 2001 23.755 1.644 25.399 Source: American Trucking Associations, Inc., American Trucking Trends 2003. Registrations (Millions) 30 25 20 Truck-Tractors 15 Commercial Trucks 10 5 0 1999 2000 2001 Year Source: American Trucking Associations, Inc., American Trucking Trends 2003. Figure 35. Estimated truck registrations in millions, 1999 to 2001. retail sales fell during this same period, the total number of reg- for the industry (adjusted for inflation) grew from $66 billion istrations increased by approximately 11 percent, from 22.8 to $75 billion, an increase of 12.6 percent. The number of car- million to 25.4 million. Commercial trucks exclude vehicles riers in the sample increased by 66 percent during this period that are used for personal transportation, as defined by VIUS. as well. These numbers also do not include carriers making less than $3 million in annual revenue. Trends in Revenue Table 33 and Figure 36 show the revenue growth of the Trends in Domestic Intercity Ton-Miles for-hire trucking industry since 1991. ATA used data from the Motor Carrier Annual Report, a U.S. DOT filing for car- Table 34 and Figure 37 show trends in domestic intercity riers making at least $3 million in annual revenue, excluding trucking ton-miles since 1992. After steady growth during the household goods carriers. Between 1991 and 2001, revenue 1990s, trucking ton-miles began to decline in 2000. TABLE 33 Operating revenue for for-hire trucking firms with over $3 million annual revenue, 1991 to 2001 ($ Millions, 2001) Year Number of Carriers Revenue Average Revenue per Carrier 1991 1,472 6,637 45.09 1992 1,479 6,958 47.05 1993 1,380 7,062 51.17 1994 1,495 7,027 47.00 1995 1,625 6,839 42.08 1996 1,862 6,525 35.04 1997 1,597 5,937 37.17 1998 1,560 5,643 36.18 1999 1,432 6,075 42.43 2000 2,315 6,475 27.97 2001 2,444 7,475 30.59 Source: American Trucking Associations, Inc., American Trucking Trends 2003.

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34 Percent Change in Revenue from Previous Year 20% 15% 10% 5% 0% -5% -10% 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 -15% Year Source: American Trucking Associations, Inc., American Trucking Trends 2003. Figure 36. Percentage change from previous year in operating revenue for for-hire trucking firms with over $3 million annual revenue, 1991 to 2001. Trends in Business Failures TABLE 34 Domestic intercity trucking ton-miles, 1992 to 2001 As shown in Table 35 and Figure 38, the number of truck- Ton-Miles ing business failures varies each year. Between 1999 and Year (Billions) 1992 815 2001, annual failures more than tripled, rising from 1,200 to 1993 861 nearly 4,000 during the shallow economic recession, but 1994 908 since then have roughly returned to the 1992 level. 1995 921 1996 972 1997 996 1998 1,027 Distribution of Revenue within Industry 1999 1,093 2000 1,074 According to Euromonitor International, a global market 2001 1,051 analysis and research firm, the five largest trucking operators Source: American Trucking Associations, Inc., American Trucking in the United States accounted for 9.8 percent of the total Trends 2003. market value in 2002, up from 9.5 percent in 2001. Ton-Miles (Billions) 1,200 1,000 800 600 400 200 0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 Year Source: American Trucking Associations, Inc., American Trucking Trends 2003. Figure 37. Domestic intercity trucking ton-miles, 1991 to 2001.