Vol. 114 - No. 99 - May 25, 2010

Only 30% of Port of LA Subsidized Truckers Purchased New Vehicles

It has been reported that only 30 percent of the motor carriers that received subsidies from the Port of Los Angeles to purchase new trucks are on track to meet the port's minimum requirement for using the vehicles in port service.

As part of the port's clean-truck program, drayage companies that purchased 2007-model or newer clean-diesel trucks, or trucks powered by clean alternative fuels, were given an incentive payment of $20,000 per vehicle.

Since late 2008, some 100 motor carriers purchased 2,100 compliant trucks, costing the port $44 million in subsidy payments.

In order to keep the incentive money, motor carriers must use each clean truck for a minimum of 300 trips to the Port of Los Angeles per year, or about one trip each working day. Port statistics indicate that in the past motor carriers have averaged 1.8 trips per day per truck.

The port's fiscal year comes to a close on June 30. In a presentation to the harbor commission, John Holmes, director of operations, said only about 30 percent of the motor carriers receiving the $20,000 per-truck subsidy are on track to meet the 300-trip minimum.

Harbor truckers unable to meet the requirement blame the 15 percent drop in cargo volume this past year as the main culprit. They add that since they also serve the neighboring Port of Long Beach, and those trips don't count toward the minimum requirement, Los Angeles should make adjustments to the program.

The port staff in fact intends to recommend that the harbor commission consider several options for modifying the program's requirements so that motor carriers with good intentions are not penalized.

Holmes said the program has been successful in achieving its main goal, which was to ensure that there was sufficient drayage capacity in the harbor this past year as older trucks were banned under the terms of the clean-truck program.

On the other hand, some trucking companies accepting subsidy money made far fewer than 300 trips to the harbor, and almost 400 of the new trucks have yet to make a single trip to the marine terminals.