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INTERNATIONAL CONFERENCE of TEAMSTERS LAWYERS THIRTIETH MEETING Montreal, CANADA September 24 – 26, 2018

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INTERNATIONAL CONFERENCE of TEAMSTERS LAWYERS THIRTIETH MEETING Montreal, CANADA September 24 – 26, 2018 INTERNATIONAL CONFERENCE OF TEAMSTERS LAWYERS THIRTIETH MEETING Montreal, CANADA September 24 – 26, 2018 DEALING WITH AUTOMATION Prepared and Presented by: Cassandra Ogren Deputy Director, Research Strategic Research & Campaigns Dept. International Brotherhood of Teamsters 25 Louisiana Ave., NW Washington, D.C. 20001 [email protected] DEALING WITH AUTOMATION Literature Review of Autonomous Vehicles New Technology and Automation Contract Language— Examples and Best Practices 2 [IBT STRATEGIC RESEARCH & CAMPAIGNS DEPARTMENT] May 25, 2017 Literature Review of Autonomous Vehicles Table of Contents Introduction Description of Commercial Trucking Industry Methods of Driver Compensation Employment Data in Trucking Industry Statistics Drivers’ Risks in the Industry Current Status-- Autonomous Trucking for Freight Systems Regulatory Issues National Highway Traffic Safety Administration Guidelines Claimed Benefits of Autonomous Trucks Critiques and Questions Environmental Pros and Cons Companies Involved With Developing Autonomous Cars and Trucks Truck and Bus Tests of Autonomous Vehicles Car Tests of Autonomous Vehicles 1 [IBT STRATEGIC RESEARCH & CAMPAIGNS DEPARTMENT] May 25, 2017 Introduction Widespread utilization of some level of autonomous trucks and cars is on the immediate horizon for transportation. However, it may be a while before fully driverless vehicles are on the roads. Companies pioneering autonomous trucks and vehicles try to sell cost savings as being good for trucking employers and consumers. It is stilluncertain specifically how autonomous trucks will impact both the number and nature of truck driving jobs in the future. Predictions made by experts range from doom and gloom, with millions unemployed, to an idealistic scenario with new job categories being created and lower rates of deaths and injuries from vehicle crashes. What is certain is that the industry and working conditions are evolving rapidly. As a point of clarification this document mostly focuses on trucking involving full length trailers because that type of operation is the primary part of trucking that is being publicly discussed for adoption of autonomous technology, and because there are unique automation techniques that apply only to trucking. Package delivery trucking is mentioned intermittently because it is an important part of the industry for the Teamsters, as UPS is the largest Teamster employer and a dominant player in the package delivery market. Furthermore, one should not expect autonomous vehicles, if a viable technology that can be adopted at a large scale, to stop with full length trailer trucking. Defining the Commercial Trucking Industry Overview Commercial trucking as an industry is comprised of multiple segments that each serve a certain customer base and perform a specific function. There are a number of different ways to break trucking into smaller segments. Trucking can be broken down into two parts based on whether it is in-house (Private) or for-hire. Within the for-hire segment, in which shippers hire trucking companies to transport their freight, freight movement is characterized by broad service markets of truckload (TL), less-than truckload (LTL), intermodal/drayage and small package delivery. In-house trucking, meanwhile, refers to trucking services owned and operated by the company whose freight is being transported. In-house fleets are operated by a wide range of manufacturers, distributors, retailers and other businesses to meet internal shipping and distribution needs. According to the FMCSA, as of December 2015, 551,150 interstate motor carriers and intrastate Hazardous Material motor carriers had recent activity operating in the United States: • 275,048 were for-hire carriers • 222,089 were private carriers • 45,699 were both for-hire and private carriers 2 [IBT STRATEGIC RESEARCH & CAMPAIGNS DEPARTMENT] May 25, 2017 • 8,314 were neither for-hire nor private carriers (e.g., government). Tables 1 and 2 list the top ten for-hire and private carriers by fleet size (i.e. number of power units, which consists of total trucks and tractors), respectively. Table 1. Top 10 For-Hire Trucking Companies in U.S. by Number of Power Units, 2016 Total Power Units Rank COMPANY PRIMARY OPERATION (Trucks + Tractors) 1 UPS/United Parcel Service, Inc. Packages 115,596 2 FedEx Corp. Packages 99,441 3 Swift Transportation Co., Inc. General Freight 25,685 4 XPO Logistics, Inc. General Freight 18,781 5 YRC Worldwide Inc. General Freight 15,119 6 Schneider General Freight 13,832 7 J.B. Hunt Transport, Inc. General Freight 13,369 8 Transport Investments, Inc. Flatbed/Specialized/Heavy Haul 13,147 9 Landstar System, Inc. General Freight 9,500 10 TransForce Inc. General Freight 8,396 Source: Commercial Carrier Journal, CCJ Top 250, 2016 Table 2. Top 10 Private or In-House Trucking Fleets in U.S. by Number of Power Units, 2016 Total Power Units Rank COMPANY PRIMARY OPERATION (Trucks + Tractors) 1 PepsiCo Inc. Food Products 24,254 2 Sysco Corp. Food Products 9,795 3 Halliburton Co. Petroleum/Gases 6,797 4 Coca-Cola Co. Food Products 6,718 5 Wal-Mart Stores Retail/Wholesale 6,476 6 Agrium Inc. (Crop Production Services) Petroleum/Gases 6,245 7 Clean Harbors Inc. Sanitation 6,009 8 American Air Liquide Holdings Petroleum/Gases 5,871 9 U.S. Foods Food Products 5,596 10 Schlumberger Limited Petroleum/Gases 5,308 Source: Transport Topics, Top 100 Private Carriers 2016 Following are descriptions of the main segments of trucking based on service type: Truckload Truckload (TL) carriers specialize in hauling large shipments for long distances. TL shipments are usually defined as those weighing 10,000 pounds or more. In this segment, a driver employed by a TL firm, or a truck owner-operator, will pick up a load from a shipper and carry the load directly to the consignee, without transferring the freight from one trailer to another. Thus, TL carriers do not need a network of 3 [IBT STRATEGIC RESEARCH & CAMPAIGNS DEPARTMENT] May 25, 2017 terminals. This segment of the industry involves substantial competition and labor is typically not unionized. TL drivers are predominantly owner-operators, not employees. Prominent TL companies include: Swift Transportation, Schneider National, Landstar System, Werner Enterprises and J.B. Hunt. Less than truckload Less than truckload (LTL) carriers consolidate, in one truck, several shipments that are going to the same general geographic area. LTL shipments are usually defined as those shipped in amounts that weigh less than 10,000 pounds. The consolidation of freight requires a network of freight terminals. Consequently, LTL carriers are characterized by networks of consolidation centers and satellite terminals. In this framework, a pickup-and-delivery truck typically transports an LTL shipment from the shippers’ dock to the trucking firms’ local terminal. There, dock workers unload and recombine the shipments with other shipments that are going to similar destinations, typically a destination terminal in another city. This transportation may be accomplished by large trucks or by another transportation mode (e.g., rail or ship depending on price and service considerations). When the shipment arrives at its destination terminal, the load is processed, moved to a pickup-and-delivery truck, and then transported to the consignee. There are national LTL firms and regional LTL firms. The largest national LTL carriers include: FedEx Freight, XPO Logistics Freight, YRC Freight, Old Dominion, UPS Freight, Estes Express Lines, and ABF Freight. Intermodal and Drayage Trucking Intermodal is the movement of freight, in a container or on a trailer, by more than one mode of transportation. The movement can be made from rail to truck to ship in any order. In intermodal freight transport, drayage is the transport of containerized cargo by specialized trucking companies between ocean ports or rail ramps and shipping docks. Drayage usually covers a short distance. XPO Logistics, California Cartage, Hub Group and Toll Intermodal are examples of significant intermodal and drayage companies. Package or Parcel Truck Delivery Package delivery or parcel delivery is the delivery of parcels or high value mail as single shipments. The service is provided mostly by postal systems, express mail and private package delivery services. In the U.S. packages weigh 150 lbs. or less. The major players that provide this service are UPS and FedEx. There are also many regional carriers like LaserShip, OnTrac and Eastern Connection, and Amazon is making inroads into this industry. General Freight Trucking and Specialized Freight Trucking Besides the segments discussed above, the trucking industry can also be classified into two segments, according to the nature of the freight being transported: general freight trucking and specialized freight trucking. General freight trucking provides transportation of general commodities; this freight is not specialized. This segment of the industry is further subdivided into local trucking and long distance trucking. Local 4 [IBT STRATEGIC RESEARCH & CAMPAIGNS DEPARTMENT] May 25, 2017 trucking establishments carry goods within a single metropolitan area and its adjacent non-urban areas. Local trucking transports a range of items such as produce to different grocery stores, lumber from the lumber yard to construction sites, and debris. Long-distance trucking establishments transport goods between distant areas e.g., from city to city and sometimes between the United States and Canada or Mexico. The firms in this segment
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