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By Jake Medwell and Loren A. Smith Jr.
With a new administration taking office in Washington and major transportation legislation possible as well, Jake Medwell, founding partner at 8VC, and Loren A. Smith Jr., president of Skyline Policy Risk Group, take a look at potential impacts on trucking. This will be a regular Q&A per quarter exclusively on FreightWaves.
Jake Medwell, founding partner of 8VC, focuses on both consumer and enterprise investments. A serial entrepreneur who has spent his life building and scaling companies, he also leads 8VC’s logistics and transportation focus. Prior to launching 8VC, Medwell co-founded Humin, a consumer mobile software company where he built the engineering team and led growth. He also co-founded The Kairos Society, where he sits on the board of directors. While in college at the University of Southern California, he founded Sole Bicycle Co. and grew it into an industry leader. Most recently, he co-founded Operation Masks with partner Drew Oetting to help bring PPE to medical workers on the front line of the fight against COVID-19.
Loren A. Smith Jr. is the president of Skyline Policy Risk Group. From 2017-21, he worked at the Department of Transportation as deputy assistant secretary for policy. There, his leadership included serving as DOT’s chief environmental review permitting officer; chair of the management team for the ROUTES Initiative on rural transportation; and as a member of the task force on regulatory reform, including leading efforts on supersonic aviation. From 2009-16, he was an analyst for Capital Alpha Partners, a Washington-based research firm that studies public policy for investors. He specialized in transportation policy, particularly relating to autos and infrastructure, and published more than 500 research notes.
JAKE MEDWELL: How do you expect the Biden administration to approach trucking regulations?
LOREN A. SMITH: The big picture here is going to be tightening – federal regulators certainly are going to be looking at areas where they think the regs haven’t kept up with the industry, particularly with the transition from the more permissive approach of the Trump administration to a more regulatory-minded Biden administration. An important caveat: Trucking has played a big and highly visible role in keeping the economy going during COVID, so imposing additional regulatory costs on the economy is an area where the new administration may pick its battles, especially with much of its initial bandwidth devoted to climate policy and racial equity.
MEDWELL: How could rules impacting electronic logging devices and hours of service rules change?
SMITH: The Federal Motor Carrier Safety Administration could revisit ELD/HOS regs, particularly ELD standards. However, any changes could end up being more hype than substance. Hours of service rules have tended to edge back and forth based on party control of the White House over the past few decades, but this may not be the top item on the Biden team’s agenda due to the implementation of ELDs. We do think that FMCSA could take a stab at tightening up requirements for the ELDs themselves. Meanwhile, the most important near-term decision point is whether to phase out the emergency regulatory relief that has been in place for the past year, with the current extension expiring Feb. 28.
MEDWELL: How are the regulators looking at self-driving trucks and related technologies?
SMITH: While research continues into fully autonomous systems, the next five years or so are likely to see the most news on ADAS (advanced driver assist systems). These include automatic emergency braking (AEB); lane-keeping assist; Level 2-type automated cruise control systems; and more. In 2016, the 20 major automakers committed, on a voluntary basis, to have AEB installed on all new cars by model year 2022 – i.e., later this year. Expect a veritable alphabet soup of federal agencies – NHTSA, FMCSA, NTSB among them – to lean in on potential mandates on specific requirements for these and other ADAS.
MEDWELL: Organized labor seems very skeptical about autonomous trucking. How do the job concerns play out as far as adoption of the new technologies?
SMITH: The unions are indeed concerned about autonomous trucking, but the self-driving technologies seem several years away from being a true threat to the jobs of human drivers. Driver assist technologies like AEB, by contrast, are not likely to be hindered by concern over jobs since a) they don’t feel that close to full self-drive; b) they have clear safety benefits; and c) they seem popular with drivers generally.
MEDWELL: How much do you expect the Biden administration to raise CAFE/fuel economy rules for heavy trucks after the previous administration’s efforts to lessen CAFE standards?
SMITH: The Obama administration rules on fuel efficiency for heavy trucks were not reversed by the Trump administration and are set in place through 2028. However, the Biden administration has indicated a major push on electric vehicles that could impact new trucks – and therefore manufacturers of trucks and truck engines.
MEDWELL: Are there specific safety issues that could get attention from regulators?
SMITH: Fatality reporting data suggests that a spike in crashes is occurring involving trucks at the lower end of the federally regulated level. That is, trucks between 10,000 pounds and 26,000 pounds that are required to register with the U.S. Department of Transportation but do not require a commercial driver’s license to operate. This group of vehicles could see some additional scrutiny from regulators.
MEDWELL: Do you foresee new requirements for truck underride guards coming out of the new administration?
SMITH: Unclear – and it probably depends on other factors. Underride protection consists of a barrier added to the bottom of large trucks to prevent cars, the majority sitting much lower on the roadway, from sliding underneath a truck in the event of a crash. The current state of play is that rear underride guards are required, although safety advocates have criticized the requirement as not being tough enough. There is no current mandate on side or front underride protection. Both the Obama and Trump administrations shied away from a new mandate here, due in part to concerns about the cost and the potential safety impact if the mandate cascaded to more trucks being required on the roads to carry the same amount of freight. FMCSA last year did announce stepped-up inspections on the existing rear underride guards.
MEDWELL: Are new rules for speed limiters on heavy trucks on the table?
SMITH: We see 25% odds of a final rule on this one over the next several years. The Obama administration had issued a Notice of Proposed Rulemaking on mandating speed limiters at either 70, 65 or even 60 mph. The Trump administration moved to rescind the proposed rule, but that rescission was itself stopped at the start of the Biden administration. This would be a politically controversial rule, with a significant headline economic cost, in an area not likely to be a top policy priority for the Biden administration – all of which suggest nothing ends up happening.