The Gains on Your Bitcoin Investment Can Be Taxed. in Addition, If You Hold Large Amounts of Bitcoin in a Foreign Entity, You Must Declare This Fact with the IRS

Q3, 2019 www.ntda.org

Welcome

National Trailer The NTDA Market Outlook is designed to help you new money moving into freight and the embrace of Dealers Association improve your business. Each quarter, we deliver e-commerce, for B2B not just B2C, adds to the overall information on the semi-trailer market, new value of delivering goods via trucks and trailers. This Mailing Address: technologies, new customer segments, ways to makes semi-trailers an even better value than all other 9864 E. Grand River Ave. optimize operations, reduce costs, sell more, and freight delivery modes — more even than they are Ste. 110-290 embrace change. now. Brighton, MI 48116 The semi-trailer industry is doing well, growing, We also look at the many new ways that anyone can innovating — and keeping America’s economy rolling. become a venture capitalist, determine if bitcoin is a Toll Free: 1-800-800-4552 Trailer sales have been great the past few years. Can worthy investment, and explore America’s growing Direct: (810) 229-5960 we continue this momentum as the economy softens? senior citizen class. Fax: (810) 588-6883 In this issue we explore the wide range of threats To submit articles or to advertise in the Market and opportunities facing the semi-trailer industry. Outlook, contact NTDA President Gwen Brown toll-free Writing & Editing This includes venture capital for freight optimization, at 1-800-800-4552, direct dial (810) 229-5960, mobile by Gwendolyn Brown, changing demographics, CARB rules, proposed side (810) 844-3124, or e-mail [email protected]. As always, NTDA President guard rules, and a possible surface infrastructure the NTDA welcomes your feedback. funding bill. In the short-term, not all the news is Layout & Graphic positive. However, in the long-term it seems as if the Design by:

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Welcome...... 1 Infrastructure Spending Bill FAQs ...... 2–4 Small Bets, Big Crowds...... 6–9 ANNUAL SUBSCRIPTION: America Snapshot: Getting Older...... 10–11 Member Pricing: $49 Your Bitcoin Questions Answered...... 12–14 Non-Member Pricing: $89 The Big Number...... 16 CARB Trailer Certification: FAQs...... 18–20 Clarifying Rear Impact Guard Confusion...... 21–24 1-800-800-4552 The Trailer Economy — Q3, 2019...... 26–28 FTR Hosting Economic Outlook...... 28 www.ntda.org

facebook.com/ntdaonline www.linkedin.com/company/national-trailer-dealers-association/ www.ntda.org 2 Infrastructure Spending Bill FAQs

You’ve seen the stories. Potholes causing thousands of dollars’ worth of damages. Semi-trailers stuck in traffic, roads closed, bridges in desperate need of repair. Earlier this year, an overpass on I-75 near Chattanooga collapsed, shutting down one of the most heavily trafficked trucking routes in the eastern U.S. America needs to invest more in its surface infrastructure. A study by the Brookings Institution found that when adjusted for inflation, total public spending on infrastructure fell by $10 billion from 2007–2017, from $450.4 billion to $440.5 billion. Moreover, part of this spending was a one-time stimulus in 2009, part of the “American Recovery & Reinvestment Act.” America has been underfunding infrastructure spending.

WILL THE FEDERAL gave up on this massive package that covers the Much of the reporting on infrastructure GOVERNMENT OFFER ANY HELP? SOON? next two years of federal government spending. spending focuses on the latest statements, Is this the way forward? Unfortunately, which may ultimately not move the needle Sadly, the best odds are on…maybe. Partisan the new federal spending deal doesn’t cover much. Or, they focus on partisanship: President squabbles, an early election season, concerns infrastructure spending. That will come from Trump won’t work with the Democrats. The over who will pay for upgrades — and how what’s typically called the Highway Bill, and the Democrats don’t want to give President Trump — are all preventing the country from a amount in that bill — and when it passes — a win. We’ve culled through the posturing in massive infusion of money on improved basic remains completely up in the air. search of facts. infrastructure. No matter how badly you think it is needed, The recent major government spending or how much you believe it will help spur WHEN CAN WE EXPECT AN package, however, offers both hope and a way economic growth, it’s best to assume there INFRASTRUCTURE SPENDING BILL? forward. Defense spending went up, domestic will be no massive infrastructure funding bill spending went up, there were no limits on in 2019. Time is running out on this year’s Addressing Congress at the start of this year, building a border wall, there were few demands legislative agenda, and partisanship now rules for offsetting new spending, and the total President Trump said infrastructure funding is Washington, DC. However, there’s still a very “not an option, this is a necessity.” Pundits were amount of spending increased a bit based real chance of a trillion-dollar-plus infrastructure on inflation. Yet for all of that, total spending sure it was going to happen in 2019. That seems spending bill actually passing sometime in 2020 less likely now. remained at a somewhat lower level compared — maybe exactly when the economy needs a to the overall size of the economy. Both parties That said, states want this passed, industry jolt of public spending. wants this passed, President Trump and most Democrats appear to want this to get passed. That may not mean as much anymore as it once did, given partisanship in the nation’s Capital. Luckily, time is on our side. The 2015 Fixing America’s Surface Transportation Act (FAST) is only funded till September 2020. Most representatives and industry participants want something big to replace it, not a piecemeal package. A five-year plan, similar to FAST, is a reasonable expectation. It seems likely that FAST will get replaced.

Continued on Page 3… Q3, 2019 3 Infrastructure Spending Bill FAQs

WHAT WILL AN INFRASTRUCTURE SPENDING BILL INCLUDE?

Democratic leaders Nancy Pelosi and Chuck Schumer, and President Trump, have all touted a potential $2 trillion infrastructure package, but that amount is not set in concrete, and even if passed, it may in fact turn out to be something like, say, $200 billion a year over 10 years, a huge amount, true, but it could get changed with each new bi-annual election. No surprise that Senator John Barrasso (R-WY), chairman of the U.S. Senate Committee on Environment and Public Works, stated that the committee would “be first out of the gate to pass a highway infrastructure bill.” The Senate unanimously approved a $287 billion reauthorization bill on July 30. The bill must be paired with a version from the U.S. House of Representatives and that is not expected to be introduced until the fall of this year, at the earliest. Nobody knows how much the final agreed upon figure will be, nor when. is the big new funding mechanism. The federal infrastructure spending. That’s right. In the The current leaders have added to the tax on gasoline has stayed at 18.4 cents per past, infrastructure spending has often been confusion by suggesting a “big and bold” gallon (24.4 cents for diesel) since 1993. used to help put people to work. However, infrastructure bill be used not only to fund That said, do not expect a new plan to reflect the unemployment rate is already at a 50-year roads and bridges, but mass transit, improved President Trump’s 2018 proposal, “Legislative low. In fact, there may not be enough readily communications infrastructure, used to help Outline for Rebuilding Infrastructure in America,” available workers should there be a sudden combat climate change, boost minority that no side embraced. In that plan, the need for significantly more construction and President’s focus was on regular federal funding, road workers. but in smaller amounts — $20 billion a year Trucking accounts for 70% of freight hauling While there are no over 10 years — with the federal funds linked to in the U.S., meaning improvements of roads guarantees FET will be newer and fewer regulations that the President and bridges, and reducing congestion times, believed would encourage more state and local will have a sizable, positive impact on the repealed or reduced as funding and incentivize states to work with economy. Plus, the growth of the overall private capital (e.g., through private toll roads or economy, the rapid growth of e-commerce, and part of a new Highway Bill, private ownership) to spur more development. new technologies that support platooning and there is a chance. Instead of the typical infrastructure funding semi-autonomous trucking are making freight model, 80% from the federal government and hauled via semi-trailers an even greater value. 20% from the state, President Trump’s original Not maintaining our road surface infrastructure contractors, improve the nation’s airports plan flipped this. This plan did not succeed. creates a long-term net harm to the U.S. and waterways and get people back to work. economy and the industry. Why, then, isn’t this a That’s a lot of things given the critical nature of WHAT’S HOLDING THIS LEGISLATION slam dunk? our surface infrastructure and its value to the BACK? economy. Ranking what’s holding a deal back: Can you say taxes? Any bill (that passes) President Trump wants a massive infrastructure 1. Partisan fighting —an unfortunate will likely include more than just a big dollar package. States want it, too, as do local reality of our times. There are real figure, however. A new method of funding communities, fleets and over-the-road truckers, electability consequences. Democrats projects year after year that is more sustainable those who work in freight and logistics — and don’t want to give President Trump a win. and rational seems certain to be part of any many semi-trailer dealers. Big infrastructure Republicans don’t want to increase infrastructure bill. While there are no guarantees spending will result in better roads, more roads, taxes. An infrastructure bill seems almost Federal Excise Tax will be repealed or reduced encourage more freight via truck, and put more certain to require both. That said, the as part of a new Highway Bill, there is a chance. semi-trailers on the road. Plus, the still-growing biggest stumbling block may be the GOP. Still, it’s best to assume an increase in the gas tax economy is actually harming chances for more President Trump and the Democrats want this, and President Trump appears open Continued on Page 4… www.ntda.org www.ntda.org 4 Infrastructure Spending Bill FAQs

that vehicles on the road should bear the brunt of road costs, whether they use gas or not. An “annual registration fee” on alternative fuel vehicles is often discussed but this seems unlikely to pass. There will be various new (or increased) fees, however. It’s safe to expect both

Trucking accounts for 70% of freight hauling in the U.S., meaning improvements of roads and bridges, and reducing congestion times, will have a sizable positive impact on the economy.

to increases in taxes to fund this, whereas some monies geared toward bike lanes new and increased taxes, such as new waybill the GOP is not eager to raise taxes. or to encourage bussing, for example. As taxes, new taxes on trucking and road-based 2. Every legislator is busy fighting for Democratic leaders Pelosi and Schumer freight delivery, higher fees for cross-border their community’s share. Consider that a have said, they want an infrastructure freight hauling, and possibly mileage-based $1,000,000,000,000 funding agreement bill to “go beyond transportation and into fees. spread across 50 states and thousands of broadband, water, energy, schools, It may be a pipedream to assume a $2 trillion communities, and you understand the housing and other initiatives.” Lofty infrastructure funding bill. There is a presidential mad dash to fairly (or not fairly) divvy it all goals and these will get in the way of election in 15 months, after all. Expect a bill up. Until that’s settled, there will be no bill. reaching consensus. closer to $500 billion, the amount that’s been 3. Working environmental concerns into suggested by the House Transportation and the package and deciding how much if WHAT ARE SAFE PREDICTIONS? Infrastructure Committee. any infrastructure dollars should be earmarked for various green initiatives. A bill will pass in 2020. Partisanship and WHAT ARE CRAZY POSSIBLE BUT 4. Finding agreement on how to pay for complexity aside, the nation’s economy is UNLIKELY TO HAPPEN PREDICTIONS? this — not just through debt and taxation, dependent on workers taking cars to get to but possibly abandoning Federal Excise their job and the majority of commerce hauled A bill of $1.5–$2 trillion, possibly more. Tax, changes to gas taxes, fees on electric is via semi-trailers, all of which require usable President Trump proposed $1.5 trillion in vehicles, and more. roads and minimal congestion. In addition, the 2016 and $2 trillion in 2017, and Democrats 5. Setting priorities: even a $2 trillion federal current federal highway funding (FAST) expires have not suggested reducing this. A larger bill won’t fix everything, let alone build in September 2020, and the Highway Trust Fund reliance on private ownership/management of new. There are over 45,000 structurally is predicted to become insolvent in 2021. The infrastructure is less likely. deficient bridges in the U.S., for example. pressure is on. Or…In exchange for something major, There are thousands of people who want It is safe to assume an increase in the gas tax Democrats agree to new rules that spur massive of about 25-cents per gallon. The American private sector investment by allowing private Trucking Associations is lobbying for a 20-cent- ownership of many roads and private (or public- per-gallon increase (5 cents over four years), private) tolls to fund repair and maintenance. which it says will raise $340 billion for the Another option is that President Trump gets Highway Trust Fund. The federal tax on gasoline a small bill passed, of about $500 billion, for has remained constant at 18.4 cents per gallon example. The President could gamble that — 24.4 cents per gallon for diesel fuel — since Democrats sweep into power in 2020 and he 1993, despite inflation. Also expect a gas tax is re-elected. Then Democrats could pass a indexed to inflation. massive multi-trillion-dollar package soon after Assume some new tax on electric (or (in 2021 or 2022). alternative fuel) vehicles, as there is consensus 8.5x11 NTDA Market Outlook S2S May22.pdf 1 5/22/19 3:43 PM

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The semi-trailer industry is both capital- opportunity on file with the Securities and and labor-intensive. It involves nurturing Exchange Commission, and whose business Venture capital gains long-term relationships, a commitment to plan and financials are available to every may not be feasible, the community, advanced manufacturing, potential investor. Investing in ModVans customer service, and employees with a broad doesn’t get you a tee shirt or your name on but thanks to changes skill set, from line work, customer relations, a plaque. You’re an actual investor with an in investment laws, it’s sales, mechanics, and much more. We love this equity stake. industry! They are seeking $1.07 million in Class B, now possible for anyone We also love uncovering ways of garnering non-voting common stock, with shares valued to invest in a start-up. potential outsized gains for little cash. That’s at $5.95. They have a pre-money valuation what we explore here. Using small amounts of of $12.5 million, approximately 5X total first What kind of start-up? money for Venture Capitalist-like gains. year revenues of $2.5 million. Of course, even Anything! if they succeed, your payoff may take years. POSSIBLE? Like many venture capital-funded enterprises, investors won’t get paid until the company course, as with any startup, it’s probably Venture capital gains may not be feasible, goes public, gets bought out, or in rare cases, best to assume you will lose your entire but thanks to changes in investment laws, goes back for another round of funding. investment. If that’s too high a price to bear, it’s now possible for anyone to invest in a The lure for investors is that you support don’t invest. start-up. What kind of start-up? Anything! A a business you love — and that its value will For investors, the appeal is obvious. For craft brewery or distillery, software to control ultimately exceed far more than when you as little as $100, you can invest in a startup your appliances, keto dog food, independent originally invested. For example, if a company you believe in, that you think has massive Hollywood movies, these and more are all seeks $1 million for a 20% stake, that’s a potential. For as little as $5,000, you can have “equity crowdfunding” business opportunities. valuation of $5 million. If it goes public in your funds pooled with others to get in on Consider ModVans, a startup hoping to build six years, say, and garners a valuation of $25 major real estate development opportunities modular camper vans designed to “win the million, your original stake went up 500%. or buy famous artwork. hearts of adventurers and soccer moms alike.” The reason ModVans and companies like it Here, we focus on investing in business ModVans has raised about $250,000 from go this route is because they want to raise a startups. nearly 400 investors — an average investment lot of money, usually at least $1 million, and of $625. The company is just hoping to get to because they believe their product will appeal EQUITY CROWDFUNDING a production capacity of 10 vans per month to (potential) investors, beyond just the later this year. potential for getting a big return. It’s called Equity crowdfunding, sometimes called Will they succeed? Will the small investors “equity crowdfunding” and it’s just beginning investment crowdfunding, got its start in lose everything? Hard to say, but understand, to take off — for both makers and those 2012 with the passage of the Jumpstart this isn’t an artist seeking to raise money to seeking to put their extra cash to good Our Business Startups or JOBS Act. The put out a record, or a family member hoping use, supporting entrepreneurs that support JOBS Act created a new class of company to garner quick cash for their latest idea — their values, or simply because they believe called the “emerging growth company.” both worthy endeavors. This is an investment the investment will pay out big time. Of These companies could raise up to $1 million annually and issue equity, subject to Securities and Exchange Commission Rules and Regulations, but have fewer requirements with respect to audited financial records or limits on how they promote their offering. More importantly, the JOBS Act created a new form of investing, called “Crowdfunding.” Previously, only high-net-worth “accredited investors” could invest in early stage opportunities. Following the JOBS Act and subsequent amendments, many of the reporting rules and limits on how much could be raised were lifted, along with many of the restrictions Continued on Page 8… MAC Expanding Horizons FP Ad 7.875x10.2 2019.pdf 1 1/22/19 8:35 PM

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1-800-795-8454 Corporate Office www.MACtrailer.com www.ntda.org 8 Small Bets, Big Crowds

on how much “non-accredited investors” opportunity can seek out seasoned investors, investors, thanks to these platforms. could invest. That creates big opportunities venture capitalists, or find other routes. Even Again, you could lose all your investment. by allowing any person, family or group to with fewer regulations, equity crowdfunding Always remember that. launch an endeavor and seek funding, but still has some reporting, auditing and other Two more caveats: 1) It is possible that due diligence is a must. When it comes to requirements. Many small investors may do companies go the crowdfunding route startups, assume you could lose everything. better by maxing out their 401K, or setting because seasoned investors looked at their Essentially, crowdfunding is enabled by aside extra cash that can be put into an index business plan and passed on it. That’s a allowing any startup, following reasonable stock fund or managed by an investment warning sign. 2) In addition to the potential financial rules, to openly seek investments advisor. These are likely much safer bets. for losing your entire investment, remember from the majority of adults. You do not need However, the scope of equity crowdfunding that even if the company succeeds, you won’t to be an accredited investor — whose worth opportunities combined with the potential for see a gain for possibly many years. You are exceeds $1 million, not counting your home. larger-than-stock market gains is appealing. investing in a company and that means your The original argument against the JOBS Plus, there’s far greater opportunity to investment is tied up in their operations. Act was that it could lead to fraud and worse, match your investment with companies you You can’t just take your money out — it’s not to many low net-worth investors losing a believe in or whose values better align with liquid. You have to wait until a certain pre- significant amount. The counter argument is your own. There are vegan bakery start-ups, defined event occurs, such as the company that it encourages more entrepreneurialism, distilleries with a focus on local ingredients getting bought out or the company going promotes new and small businesses, and and manufacturing. There are companies public, or possibly choosing to seek a massive should lead to more and better-paying jobs, seeking investment for Christian-based investment from a hedge fund, for example, as these innovative companies take root. movies, or camping gear specifically designed which may then pay you out an agreed Plus, small-time investors can finally get in for women. For the entrepreneur, access to amount. Each investment scenario varies. on startup investment opportunities. More capital, particularly from those who would also capital is being put to work, which should make great customers, is equally appealing. EQUITY CROWDFUNDING PLATFORMS lead to more jobs and a growing economy. Is We examined several equity crowdfunding this the case since the Act passed? The verdict sites, which are summarized below. There’s Most equity crowdfunding platforms earn so far, is mixed. an abundance of investment opportunities. their income from fees charged to listed Entrepreneurs with a high-growth Anyone can create a startup and seek out entities. Their platform is a convenient way for a startup to showcase their product or service, to communicate with potential investors, blog about any successes or setbacks, and to manage financial transactions. These platforms can also earn fees for holding an investor’s money until such time as that money is formally transmitted to the startup company (which is always spelled out but varies from one startup to the next). Examples of popular equity crowdfunding sites are listed on Pages 9–10. These are not recommendations.

Continued on Page 9… Q3, 2019 9 Small Bets, Big Crowds

gains. You may need to wait a quarter or two, since real estate isn’t liquid, but this is not the same as investing in a startup. The minimum investment is $500.

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Have you taken your son or daughter on a campus tour recently and noticed the STARTENGINE with an impressive array of crowdfunding very big, very nice, new residential towers www.startengine.com opportunities spanning entertainment that students can now live in? They are and manufacturing, software and home not at all like the dorms of yesteryear. Rich Solid focus on equity crowdfunding, with brew. MicroVentures is unique in that it also Uncles focuses investment in these types a large list of investment opportunities — includes some larger, successful businesses of properties. The minimum investment is over 60 investments currently, including seeking to grow their business — a potentially $1,000. for advanced drones, small wind turbines, safer bet. Minimum investment is $100, but scooters, new food products, and more. some require much more. YOU, THE VENTURE CAPITALIST Minimum investment is typically $100–$500 to invest in any of the companies listed. REAL ESTATE CROWDFUNDING Thanks to loosening government regulations and computing platforms, nearly everyone NEXTSEED The ability to pool money from many can be an investor in a software company, a www.nextseed.com/offerings investors, including from many small-time restaurant or gym, a student dorm, anything. investors, creates a host of new opportunities. However, many of these investments are NextSeed is particularly good for those For example, while not the same as equity highly risky. looking to invest in local startups, such as crowdfunding, there are platforms that Check them out, do your due diligence, a new gym or themed restaurant in your directly invest in residential and commercial know what you can lose, assume you may lose city. There are some other opportunities as real estate by aggregating the funds from everything. These new platforms are a great well, including software startups. Minimum thousands of investors. Below are two way of learning what people are building, investment in a company is typically $100. examples. dreaming, where many think the market is headed. WEFUNDER FUNDRISE Maybe you have an idea that cannot https://wefunder.com https://fundrise.com succeed unless you get a hundred or a thousand people to invest. You now have that Like StartEngine, WeFunder’s platform Fundrise invests in a variety of residential chance. includes a range of startups in which to properties throughout America. They vet Traditional venture capital investment invest. Just reviewing the companies seeking each opportunity, though focus on newer continues to grow, so it’s no surprise that investor funds is a great way to assess what apartment complexes and real estate that crowdfunding venture capital is also technology and business for some sectors may prove more appealing to millennials. increasing. may look like in the next three to 10 years. They use funds from the crowd to buy a At this writing, there’s already been about At present, there’s a grocery delivery service property, to improve a property, and to $60 billion in venture capital investment just startup, an entertainment company that manage a property. for the first eight months of the year. There’s develops content based on user input, a new A difference with Fundrise and these a lot of capital flowing around seeking great search engine, even a motorcycle start-up. real estate platforms, compared to equity ideas, great products, great people, the next Minimum investment is typically $100–$500. crowdfunding, is that you cannot select a big thing. specific property. Your money is added with MICROVENTURES everyone else’s. However, their returns are https://app.microventures.com/crowdfunding healthy, and may prove a better investment than the stock market. Another difference is Another equity crowdfunding platform that you can take your money out, plus any www.ntda.org 10 America Snapshot: Getting Older

NTDA Market Outlook feature “America Snapshot” offers a dose of insightful information on the status of the nation, its people and economy. In this issue, we look at the aging population of the American worker. The world is getting older. Surprisingly, that’s also true for America. Since 2010, America’s population has increased nearly 11%, to about 328 million. Yet, despite all you hear about Millennials (Gen Y) and Gen Z, the median age of America’s population has gone up this decade, to just over 38 years old.

up a larger share of the total population than — the largest increase since 2008. Of this, MEDIAN AGE they do now, as the table reveals. $229 billion, approximately one-third, was for teacher salaries, the rest for support services, According to the U.S. Census Bureau, the YOUNGLINGS capital spending, and related services. The median age in America has gone from 37.2 average public school teacher salary is years in 2010, to 38.2 years, now. This increase There are more children than seniors in $60,000. varies by race quite a lot. Since 2010, the the U.S. The Census Department estimates The average spend per child on public median age has: there will be 91 million persons under the school is $12,200 annually. New York spends • Increased 1.0 years for whites; 1.4 years age of 20 in the U.S. by next year. Of these, the most, at $23,000 per pupil, followed by for blacks; 2.2 years for Native Americans approximately 52 million will be between the the District of Columbia, Connecticut and (2.6 years for native Hawaiians); 1.7 years ages of 5–18. That requires a lot of schooling. New Jersey. for Asians; and 2.2 years for Hispanics. For pre-K through 12th grade, the U.S. spent • Increased in 82% of all U.S. counties and $694 billion in 2017. That’s up 3.7% from 2016 in 49 states, dropping only in North Dakota, from 37.0 years in 2010 to 35.2 years in 2018. The “youngest” state is Utah, with a median A More Diverse Nation age of 31.0 years. The oldest county is Sumter Distribution of Race and Hispanic Origin by Age Groups County, FL, whose median age is 67.8. Native Hawaiian and Other Pacific GENERATION GAPS Population in Millions Islander alone, non-Hispanic 120 American Indian and Alaska Native alone, non-Hispanic There are now approximately 53 million Two or More Races, non-Hispanic Americans age 65-and-older, up from just 40 100 Asian alone, non-Hispanic million in 2000. That’s more senior citizens Black alone, non-Hispanic in the U.S. now than the total population of Hispanic (any race) White alone, non-Hispanic South Korea. Here’s the shocker: the Census 80 expects the percentage of seniors (age

65-and-older) to increase, at least through 60 2050. The nation is expected to grow from 328 million people now, to 430 million by 2050, 40 but of the three main population groups examined (65-and-older, 20–64, and 20-and- 20 under), only those 65 or older will increase their share of the total population. There will still be fewer seniors than the 0 2010 2018 2010 2018 2010 2018 2010 2018 other groups, however, but seniors will make Under 18 18-39 Years 40-64 Years 65 Years and Older

Continued on Page 11… Q3, 2019 11 America Snapshot: Getting Older

65-and-older 20–64 Under 20 55 million 196 million 91 million 2020 (16.1% of the population) (57.4% of the population) (26.6% of the population) 72 million 204 million 98 million 2030 (19.3% of the population) (54.5% of the population) 26.2% of the population) 81 million 220 million 105 million 2040 (20% of the population) (54.2% of the population) (25.8% of the population) 89 million 238 million 113 million 2050 (20.2% of the population) (54.1% of the population) (25.7% of the population) EDUCATED WORKFORCE HOUSEHOLD INCOME $100,000 or more. To see economic and demographic data Younger America is also more diverse, as the In 1960, nearly 90% of children lived in a for your community, type in your zip code at: above Census graphic reveals. Overall, 94% of two-parent household. By 2018, that number https://factfinder.census.gov/faces/nav/jsf/ Americans age 25 or older have a high school was 70%. This impacts family income. pages/index.xhtml. degree, and 37.6% of Americans age 25-and- Median family income in 2017 was $71,000. older have a bachelor’s degree. Approximately 14% of families posted a family income of under $25,000 a year, while 32% of families had an annual income of Ocean Lawn Networking Reception 29th Annual NTDA Convention Wednesday, Oct. 9, 2019 Ocean Lawn • 6:00pm–10:00pm N DA The Breakers NATIONAL TRAILER DEALERS ASSOCIATION Palm Beach, FL

Open to All NTDA Registered Convention Attendees, https://ntda.org/convention/register/ www.ntda.org 12 Your Bitcoin Questions Answered

A recent tweet by President Trump made it clear he is no fan of bitcoin or other cryptocurrencies, which he suggested were both risky and could be used to support illegal activities. Both statements are true. That doesn’t mean you should ignore bitcoin. Its price has been going up this year, a risky but potentially lucrative investment. Plus, Facebook CEO Mark Zuckerberg announced his company will help roll out a competing digital currency, called Libra. The goal of Libra, we are told, is to make it so everyone in the world can cheaply send money or conduct business via their mobile device, even if they don’t have a bank account or are working across borders. Along with all the hype about bitcoin, there’s lots of concern and confusion. This guide should help.

1. IS BITCOIN A GOOD INVESTMENT? If you do buy bitcoin, think of it as a wild through unless the bitcoin payment has first card investment. Pay off your bills, pay off been validated. The answer to this is probably something your debt, max out your 401K match, build up In fact, as the economy goes digital, that only the future can answer. Hedge funds your emergency fund. With what’s left over, if working at computer speed, the costs of and trading desks are only just getting in on anything, putting a portion of that in bitcoin “trust” become even greater. In the old days, the action, buying and selling bitcoin and could prove valuable in five or 10 years. If it pay in cash and the deal is done. Now, using providing research on it for their clients. While goes bust, you’re still in good shape. PayPal or Visa and a transaction may not it seems like the price of bitcoin will go up, it become irreversible for months, since the is possible that another cryptocurrency will 2. IS BITCOIN ANONYMOUS? acceptance of goods received and payment come along that turns out to be a far better received, as mediated by Visa, for example, value. Imagine buying Pets.com instead of Bitcoin is essentially anonymous. Nobody can take this long to be finally fully invoked. Amazon.com back when nobody was sure know who used it to buy something. That’s Bitcoin is akin to a digital version of cash. The how Internet retail was going to play out. part of its appeal. Bitcoin is not controlled by transaction is truly complete the moment Despite the rapid rises and quick retreats, any government or banks and transactions bitcoin changes hands (or computers). the overall trajectory of bitcoin’s price is are anonymous. As more business, banking, However, there are ways of figuring out upward, but there’s no guarantee that will sales, commerce and transactions of all sorts who was behind an anonymous purchase. continue. go fully digital, rarely touching actual physical Government and hackers can theoretically hands or paper, government entities, financial track select Internet traffic. If your bitcoin is In fact, as the economy institutions, tech companies and others have stored with a cryptocurrency exchange, such goes digital, working increased their efforts to know more and as Coinbase, audits can reveal how much more about each transaction, each step, each went into or out of your account. There are at computer speed, the person involved, allowing these giant entities tools to help individuals or groups mask their costs of “trust” become to know more about you and your business IP address and even mask transactions, but than perhaps you want. Bitcoin is a counter these are complicated. Bitcoin is anonymous even greater. In the old to this. Bitcoin is also a way of conducting for most things but if it’s used for illegal days, pay in cash and transactions at a lower cost since there’s no activities, a dedicated team should be able need for a mediator, broker, escrow agent to figure out who sent the money. It’s not the deal is done. or other entity, since no transaction can go that the bitcoin data can be pried open, but

Continued on Page 13… www.ntda.org Q3, 2019 13 Your Bitcoin Questions Answered

authorities can, if they audit your digital files, examine your online history, searches, messages, emails and the like, and come to a conclusion. The gains on your bitcoin investment can be taxed. In addition, if you hold large amounts of bitcoin in a foreign entity, you must declare this fact with the IRS.

If the goal is to hoard bitcoin, it’s a similar story. It’s possible, but difficult. You are likely buying it from a bitcoin exchange, which will retain some records. You are likely storing a bitcoin exchange. Many of these, such as dominant currency anywhere in the World, your bitcoin with that exchange — akin to Coinbase, have received tens of millions of and it will always stay that way. It is called the a bank. If you want to make sure nobody (actual) dollars to grow their service, allowing United States Dollar!” knows how much bitcoin you have, you need anyone to buy, sell and hold bitcoin. The President’s concerns may be justified. a digital wallet. These are very secure but if Remember this: bitcoin is money, since However, it’s almost certain — as commerce you lose the physical key or password, that’s it’s used to buy and sell and can be easily goes digital and the world’s seven billion money that’s gone forever. divvied up — into fractions of bitcoins, to pay people conduct more of their affairs online In the U.S., if you purchase bitcoin from a purchase. It is a store of value, a medium of and over smartphones — that some form of a reputable exchange, you are required to exchange, and a unit of account — most of digitized money will become commonplace. provide government ID. the qualities of traditional money. Right now, bitcoin is the most widely available solution, although it is probably still 3. CAN YOU EXPLAIN BITCOIN? 4. IS PRESIDENT TRUMP OPPOSED TO very early in the evolution of digital money. BITCOIN? It’s a risky investment, for sure. Yes, but this will not be easy. Bitcoin is a cryptocurrency, that’s digital money. Bitcoin Probably. The President has previously 5. CAN I SPEND BITCOIN? makes use of cryptography and a newer expressed his disdain for the Federal Reserve mathematical innovation, called blockchain, Bank’s quantitative easing, for printing of Yes, but it’s still very hard. While there are to make sure this digital “money” cannot be money, and efforts to artificially manipulate some businesses that take bitcoin, primarily copied or counterfeited. These also ensure interest rates. These are all virtually in Japan and South Korea, it’s rare to find a that someone cannot buy something using impossible to do to bitcoin. He should be a business that accepts bitcoin as payment in fake bitcoin or bitcoin they don’t actually fan of bitcoin then, right? Wrong. Last month, the U.S. Part of the reason for this isn’t just possess. In addition, thanks to the blockchain, he tweeted his concerns over bitcoin: that so few people use bitcoin, it’s that the there is a hard limit on how many bitcoin can “I am not a fan of Bitcoin and other price of a bitcoin is so volatile. Pay $100 in ever be created — 21 million. That makes it a Cryptocurrencies, which are not money, and bitcoin and it may be worth $200 by the end great theoretical hedge on inflation. You can whose value is highly volatile and based of the day, or $50. never “print” more bitcoin. on thin air. Unregulated Crypto Assets can This scares merchants away. Bitcoin is completely virtual, meaning it facilitate unlawful behavior, including drug It’s extremely hard to find any place that lives only inside computers, smartphones, or trade and other illegal activity.” accepts gold or silver, but if you do, there’s far the cloud. He added, “We have only one real currency more confidence that the price won’t swing You can use bitcoin to buy and sell goods. in the USA, and it is stronger than ever, both wildly before the merchant deposits it. You buy bitcoins — with real money — from dependable and reliable. It is by far the most Continued on Page 14… www.ntda.org 14 Your Bitcoin Questions Answered

6. HOW DO I BUY BITCOIN? 8. WHAT IS BITCOIN MINING? 11. BONUS: IF BITCOIN IS SO GREAT, Bitcoin mining is related to both bitcoin WHAT’S HOLDING UP ADOPTION? There are now lots of registered, funded and blockchain. To document a transaction bitcoin exchange companies where you and have it permanently recorded on the There are many reasons why bitcoin, for all its can buy (and store) bitcoin. Coinbase, blockchain requires computer power and hype, is still rarely actually used. Existing rules Robinhood and several others are backed by electricity. In other words, operating and regarding taxation, investment and property venture capitalists. There is an updated list maintaining the blockchain has costs. When seem to not fully apply to bitcoin, and of such companies at https://bitcoin.org/en/ bitcoin was invented, there needed to be confusion and concern are limiting use. exchanges#international. a way of promoting the development of Bitcoin is volatile, so few merchants want to You will need to provide identification blockchain. That way is bitcoin mining. accept bitcoin as payment, only to have its when you buy the first time, like opening a Computers that support the blockchain — price drop significantly in the next day or banking account. that verify every transaction — are rewarded month. with a sliver of bitcoin for their efforts. This Unlike using your credit card or even 7. IS BLOCKCHAIN THE SAME AS BITCOIN? process is called bitcoin mining. Apple Pay, for example, the systems in place to accept bitcoin are still in development. No, and this is important. Blockchain and 9. IS BITCOIN MONEY OR PROPERTY? Stories of bitcoin being used for illicit bitcoin are associated with one another, but activities scare many away. Despite what they are not the same thing. Blockchain is Both. The creator(s) and proponents of bitcoin its proponents say, the actual costs of essentially a digitized ledger that verifies claim it is money and it generally satisfies the transactions using bitcoin are higher than transactions and permanently records definition of money. It can be used for buying traditional means. This could change, and them. These do not have to be financial and selling, it is a store of value. However, probably will, just as it is now cheaper for transactions. the IRS (and other entities outside the U.S.) many businesses to use cloud services rather Blockchain uses computer processing, say bitcoin is not money but property — an than in-house applications. For now, math, and the fact that there are now billions investment. That means you will be taxed on it’s technically cheaper to buy with a Visa of computers (including smartphones) in use any gains. That also means that if you buy card than using bitcoin — even if the price in the world, and blockchain uses a portion of a lot of bitcoin and try and keep this fact of bitcoin remained the same. this computer power to verify a transaction. hidden, the IRS may investigate. Because the value of bitcoin has risen Blockchain is being tested, for example, to steadily over the past 10 years (despite verify (and create a digital “paper trail”) for 10. IS BITCOIN TAXED? periodic significant drops), many who buy each step in the process of taking delivery of bitcoin are holding it, hoping for a major produce, shipping it, storing it, shipping it to The gains on your bitcoin investment can be financial windfall in the next five or 10 years, a grocer, then selling it. taxed. In addition, if you hold large amounts for example. There is a hard limit on how Blockchain is used to verify, validate and of bitcoin in a foreign entity, you must declare many bitcoin can ever be produced. By archive every bitcoin transaction. this fact with the IRS. If you buy something with holding onto bitcoin, it cannot be put bitcoin, it will be very hard to enforce a sales tax. into use. Since we set out Dorsey has been committed to building the most durable trailers on the road. That commitment combined with dedicated customer service has kept Dorsey an all around favorite for the long haul.

Visit DorseyTrailer.net for information on our entire line of trailers. THE BIG NUMBER $1,300,000,000 A freight forwarder is a company that free-of-charge and makes money on their organizes shipments to get goods from the cut of various services. The company claims manufacturer or producer to its final point of their software platform helps companies save distribution or final destination. Forwarders money and better understand the flow of their typically do not move the goods themselves goods as they traverse multiple companies, but coordinate with a variety of shipping locations, shipping modes, handlers and modes, including ships, airplanes, trucks, others, and that this in turn provides the and rail to ensure the goods arrive at their customer with a better understanding of destination by the fastest, safest, cheapest, their market. In other words, Flexport isn’t just designed to optimize shipping and makes it and most reliable means available. It’s not a saving them money, they claim, but helping easier for a company to optimize speed, cost, pretty process. the company better understand its market reliability, or a combination of the three, from Freight forwarder Flexport says its mission potential in near real-time. origin to destination. is to “fix the user experience in global trade For example, trucking partners and and bring the world free trade through Is this worth a $3.2 billion companies can proactively schedule shipment technology.” There’s a lot of money suggesting valuation? pickups and deliveries, confirm both digitally, it will do just that — $1.3 billion in venture and provide digital proof of deliveries, with all capital to be exact. According to Forbes Magazine, the “tracking actions updated in the software in real-time. Flexport was launched in 2013. In six rounds and handling” of freight is worth “several They also provide line-by-line breakdowns of venture capital financing, it’s pulled in trillion dollars” globally. Flexport says it of all charges. That’s a big deal for many over $1.3 billion. The biggest round, this past brought in nearly $500 million in 2018 and businesses, shippers, and fleets. February, brought in $1 billion from SoftBank has an annual growth rate of 95%. The company notes in its mission that Investment Advisers, and gave the company a It was once hard to fathom how a company “without freight forwarding, global trade valuation of $3.2 billion. SoftBank specializes that knows where a container is and where it’s simply wouldn’t exist” and that Flexport is the in late-stage investments in companies it going could be worth more than controlling “modern freight forwarder,” bringing together believes will become “foundational platforms” the means of freight itself. However, “advanced technology and data analytics, that can revolutionize commerce. Flexport remember, the owners of content are not logistics infrastructure, and supply chain could do just that. nearly as rich as Google, which merely indexes expertise.” Obviously, many smart people Flexport already serves more than 10,000 that content and provides links to it for the controlling billions in capital agree. Their goal, clients and suppliers across 200 countries, whole world to see. The New York Times and to become the “Operating System for Global offering a range of services, including ship, Washington Post both required billionaire Trade” is timely. air, truck and rail freight support, drayage, buyers to help fund their operations, while How Flexport traverses this fragmented warehousing, customs support, insurance and Google throws off billions in profits every industry, tariffs, trade wars, and other more — all traditional freight forwarding- quarter. competitors remains to be seen. There are a related services. However, it’s the company’s Flexport’s funding is another signal good number of partially empty semi-trailers, software platform that may be why they’ve that supply chain, logistics, freight — and shipping containers and warehouses, and garnered so much venture capital. ultimately, interstate, intrastate and last-mile there’s big money in making sure they are all Flexport owns just four warehouses and delivery — are all undergoing a big money filled up, or if not, that the shipper can take two jets. However, the company’s Uber-like transformation, as software companies and advantage of the situation and snag a better software platform is designed to help any venture capitalists pour billions into knowing price. Ultimately, full shipments are likely to business find the fastest, cheapest or most what’s inside every container, where it’s at mean trade and shipping grow even bigger. reliable shipping for their needs, origin- every single moment, where it’s headed, who There is no better value in shipping than to-destination, or whichever combination wants it, and what’s the best price available using semi-trailers. Thus, as more money flows of the three suits the shipper’s budget every step of the way. into optimizing trailer loads, and the value and requirements. Flexport claims that Flexport says of the top 100 freight of shipping via semi-trailers gets even more their intuitive software also offers a level forwarders, they are “the only one founded attractive, that should lead to more semi- of visibility into the status of a company’s after Netscape.” They claim their clients save trailers sold, serviced, and on the roadways, shipments, along with better analytics, than two to three days when they use Flexport certainly in the long run. any competitors. Flexport offers its software for end-to-end service. Flexport’s software is

Page 16 CLA assembles the team you need for high performance. WEALTH ADVISORY | OUTSOURCING | AUDIT, TAX, AND CONSULTING

Bret Kruse | 314-925-4332 Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC-registered investment advisor. ©2019 CliftonLarsonAllen LLP | 26-0622 CLAconnect.com www.ntda.org 18 CARB Trailer Certification: FAQs

Following the publication of the 2nd Quarter 2019 Edition NTDA Market Outlook newsletter that included a full analysis of the California Air Resources Board (CARB) “Phase 2” trailer regulations, CARB then issued its own “helpful tips” page for trailer OEMs, dealers, parts/ component manufacturers, and others who have questions regarding these new “emissions” rules. Since the new document is also quite long, and much of it geared toward those engaged in testing aerodynamics and materials, we have summarized their document below for the benefit of all our members.

CAN YOU SUMMARIZE THIS FOR ME?

Yes. Beginning Jan. 1, 2020, trailer manufacturers must certify that their model year 2020 (and later) trailers meet CARB’s WHEN DO THE NEW RULES TAKE EFFECT? Owners, operators, and fleets must still new “Phase 2” emissions standards to legally comply with California’s existing Tractor- sell their trailers in California. Affected trailer The rules take effect Jan. 1, 2020, so it’s Trailer GHG (TTGHG) Regulation, which sets types include box-type trailers (dry van and imperative that trailer manufacturers certify emissions and other rules for semi-trailers in refrigerated van trailers of all lengths), flatbed their model year 2020 trailers soon. CARB use on California roads. trailers, tank trailers, and container chassis. includes a formula for determining model To achieve its newest standards, CARB will The emissions standards can vary, however, year: Model Year (MY) must include Jan. require manufacturers use lighter materials, by trailer type. 1 of the calendar year for which the MY is improve the aerodynamics of trailers, use The trailer emission standards can be named, may not begin before Jan. 2 of the low-rolling resistance tires, tire pressure met through a combination of aerodynamic previous calendar year, and it must end by monitoring solutions, and other methods. improvements, low-rolling resistance Dec. 31 of the named calendar year (making it CARB will also require manufacturers to tires, tire pressure systems (Tire Pressure technically possible for a trailer manufactured provide the state with extensive data on Monitoring System and/or Automatic Tire in a particular year to have a different “MY”). testing that verifies its trailers meet the new Inflation System), and/or weight reduction. emissions standards. CARB will also require The rules apply to trailer manufacturers of all WHO IS RESPONSIBLE? manufacturers to provide warranties on any size trailers, if they want to sell in California. emissions savings-related features — and this Also note that the standards become could impact dealers. more stringent in 2021, 2024, and in 2027. Trailer manufacturers that sell trailers to Questions related to the new rules and California fleets are the primary regulated WHICH TRAILERS ARE REGULATED? documents required should be submitted to entities for these new rules, not dealers, not [email protected]. parts or accessory makers, not fleet owners. Trailer aerodynamic • Long-box dry vans (greater than 50.0-ft. device manufacturers in length) (i.e., those that make • Long-box refrigerated vans (greater than skirts, tails, etc. 50.0-ft. in length) to improve trailer • Short-box dry vans (50.0-ft. and shorter aerodynamics), in length) although not directly • Short-box refrigerated vans (50.0-ft. and regulated, may request shorter in length) preapproval of devices • Tank trailers designed to transport liquids that improve trailer or gases aerodynamics. These • Flatbed trailers with continuous, flat pre-approved devices platforms can be used by trailer • Container chassis (all lengths). manufacturers when configuring trailers to meet the trailer standards. Continued on Page 19… Q3, 2019 19 CARB Trailer Certification: FAQs

WHICH TRAILERS ARE EXCLUDED?

• Trailers built before Jan. 1, 2020 • Trailers pulled exclusively by pintle hook or hitch; not designed to be pulled by Class 7 or Class 8 tractors • Non-box trailers that do not meet the definition of flatbed trailers, tank trailers or container chassis • Trailers with four or more axles, and trailers less than 35-ft. long with three axles • Trailers intended for temporary or permanent residence, office space or other workspace • Trailers with a gap of 120 in. or more between adjacent axle centerlines. • Equipment that CARB does not consider to be a trailer, include: top-loading dry bulk “vans;” containers that are not permanently mounted on chassis; ex pandable, gooseneck, drop deck or lowboy platform trailers; dry bulk tank trailers with hoppers; and tank trailers trailers made by one manufacturer that are whose main purpose is for storage. END OF YEAR REPORTS all subject to the same standard, limited to a single model year.) There are 10 possible trailer subcategories according to CARB (e.g., WHAT IS THE CERTIFICATION PROCESS? Manufacturers are required to submit an end of year report within 90 days after the end full-aero long box dry vans, full-aero long box refrigerated vans, full-aero short box dry vans, The certification process for manufacturers, of the MY (i.e., March 31, 2021 for 2020 MY full-aero short box refrigerated vans, etc.). plus the reporting and record-keeping trailers). Reports must include total U.S. and CARB allows manufacturers to group related requirements, is significant. California-direction production volume per families into one to ease the process (e.g., full- Manufacturers applying for certification trailer family; vehicle identification number, aero long box dry and refrigerated vans may must first register with CARB. This requires the vehicle configuration and subfamily for each be combined into one subcategory). following: vehicle; trailers exempt under the transitional allowance flexibility; and manufacturer WHAT IF I HAVE A TRAILER MADE BEFORE 1. A physical letter of intent that states average CO2 performance by subcategory. the intent to certify with CARB and Emissions test data and all other information 2020? presents an overview of what trailers will must be kept on file for eight years after be certified. issuance of an Executive Order and may Phase 2 trailer certification standards only 2. A spreadsheet that includes be stored in any format and on any media. apply to new trailers manufactured for sale manufacturer name and a complete However, records must be readily available for in California. There are no requirements for list of the manufacturer’s contact inspection. owners or operators to retire or retrofit in-use information, and the manufacturer’s trailers. (However, California’s Tractor-Trailer three-digit U.S. EPA Manufacturer Code, DO I NEED TO BE CERTIFIED IF I ONLY Greenhouse Gas (TTGHG) Regulation does with confirmation letter from the EPA. MAKE EXCLUDED TRAILERS? apply to in-use trailers and may require trailer 3. Once received, the assigned CARB fleet owners to retrofit their in-use trailers. certification staff will provide a No. Trailer manufacturers do not need to The TTGHG Regulation applies primarily to certification guidance document where contact CARB if they produce only excluded the owner-operators of long-haul tractor- manufacturers can fill out the official trailers. However, CARB staff recommends trailers that travel on California highways. certification application Web form and that trailer manufacturers contact the agency The TTGHG Regulation is not limited in documents providing proof the trailers if they are unsure if their trailers are excluded. applicability to trailers sold in California. meet the new standards. It applies to all in-use long-box type Reporting requirements documents are WHAT IF I MAKE MORE THAN ONE trailers, including both dry-van and refrigerated-van trailers, traveling in available at: https://ww2.arb.ca.gov/our- TRAILER TYPE? California. work/programs/greenhouse-gas-standards- A manufacturer must submit one certification medium-and-heavy-duty-engines-and- application for each trailer family they offer. vehicles/phase-2-ghg. (A trailer family is a grouping of similar Continued on Page 20… www.ntda.org 20 CARB Trailer Certification: FAQs

in any given model year. For non-box trailers, the exemption is up to 250 annual units. Note that manufacturers must affix a trailer label that states the trailer is exempted.

WHERE CAN I GET MORE INFORMATION?

Phase 2 Trailer Certification documents, including a presentation overview by CARB, are available at: https://ww2.arb. ca.gov/our-work/programs/greenhouse- gas-standards-medium-and-heavy-duty- WHAT IF THE TRAILER IS MADE OUTSIDE low-rolling resistance tires, tire pressure engines-and-vehicles/phase-2-ghg?utm_ THE U.S.? systems, weight reduction, or other “off-cycle medium=email&utm_source=govdelivery. technology.” (FYI, end-users can replace tires A detailed “guidance document” listing CARB regulations still apply to trailers with tires of a different make or model as the information CARB is seeking from trailer manufactured outside the U.S. The trailer long as their rolling resistance performance is manufacturers is available at: https://ww3. is subject to the CARB’s Phase 2 trailer equivalent to or better than the original tires’ arb.ca.gov/cc/hdghg/meetings/trailer_cert/ certification standards if it is sold, offered for performance.) trailer_cert_guidance_document.pdf?utm_ sale, imported, or introduced into commerce medium=email&utm_source=govdelivery. for sale, registration or resale in California.

WHY IS CARB DOING THIS?

CARB acknowledges that trailers do not emit greenhouse gases. However, they claim that once these new rules are fully phased in, it will result in a reduction of over 50 million metric tons of CO2 equivalent emissions in California from 2019 to 2050. This is equivalent to saving over 5 billion gallons of diesel fuel in the same time period.

HOW CAN TRAILERS MEET THE NEW STANDARD? CARB provides a current list of DOES MY REGULATED TRAILER NEED A approved aerodynamic devices that trailer CARB provides a “compliance equation” that LABEL? manufacturers can use to certify their trailers manufacturers must complete to prove their at: https://ww3.arb.ca.gov/cc/hdghg/aero_ trailer meets the new standard. Yes, all regulated trailers are required to have device_eo/approved_aero_device_eo.pdf?_ Non-box trailer standards for flatbed a permanent label indicating that they are ga=2.221926296.1255089950.1562849315- trailers, tank trailers, and container chassis, as certified vehicles and affixed such that it is 2032532240.1553519771. well as standards for box vans designated as easily visible for inspection. A sample CARB For specific questions, contact CARB at “non-aero,” require trailer manufacturers to label appears below, which includes model [email protected]. install a certain level of low-rolling resistance year, trailer type, VIN, and manufacturer. NTDA will continue to monitor CARB tires and a tire pressure system such as actions and keep our members informed. Tire Pressure Monitoring System (TPMS) or ARE THERE ANY EXEMPTIONS? NTDA’s overview of CARB’s standards Automatic Tire Inflation System (ATIS). The reporting requirements is available to design standards do not require the use of Yes. To help meet these new rules, CARB members in last quarter’s NTDA Market any specific make or model of technology. allows manufacturers a “transitional Outlook online at: http://online.flipbuilder. Box van standards (other than “non- allowance.” Up to 20% of total California- com/mexj/thwp/#p=22. aero”) are performance-based standards. directed production volume can be exempted Manufacturers can meet the overall trailer via this transitional allowance; however, in no performance requirements with any case may the number of exempted box vans combination of technologies, including for a manufacturer be greater than 350 units the use of aerodynamic improvements, Q3, 2019 21 Clarifying Rear Impact Guard Confusion

The brief confusion regarding rear guard labels seems to have gotten cleared up. For several months in 2018 and into 2019, some inspectors were reportedly citing a trailer for rear guard violation simply because the rear guard’s manufacturer label was torn or missing — even if the guard otherwise functioned exactly as designed. Because of this, some dealers were rightly concerned that if they repaired, reinstalled or replaced a rear impact guard and the trailer was later involved in an accident, the dealer might be held partly liable if there were no official label. WHAT DOES THIS MEAN? annual commercial vehicle inspections.) Fortunately, the Commercial Vehicle Safety 3. CVSA plans to add the rear guard Alliance (CVSA) has updated its regulatory 1. Existing regulations FMVSS 223 and FM inspection to its “critical inspection item” guidance and told inspectors that a torn or VSS224 remain in place. Inspectors have list. missing label is not a cause for citation. been informed by the CVSA to not cite a 4. If a trailer does not meet the actual rear NTDA contacted Kerri Wirachowsky, trailer simply because the rear guard’s guard requirements, the inspector will no Director of Roadside Inspection Program certification label is torn or missing. longer give that trailer a CVSA-approved for CVSA, and she confirmed this, while 2. However, CVSA is tasking inspectors to decal. (But, a missing/torn label is not a reiterating, “If you are reinstalling a rear be more vigilant about making sure the reason for failing to meet the requirement.) impact guard ensure that it meets all the rear guard is properly installed and fully 5. Trailers are currently not pulled out of requirements of FMVSS 224 for installation.” satisfies the requirements. This could lead service for rear guard violations, though She added, “FMVSS 223 outlines the to more trailers being brought in for rear this could become the rule in the future. requirements of the guard but FMVSS 224 guard service/reinstallation. (In fact, there talks about the installation.” is a push to make rear guards part of REAR IMPACT GUARD STANDARD

It’s important to familiarize yourself with the standards for rear impact guards (also known as RIGs, underride guards, or ICC bumpers). The rear impact guard standards are found in FMVSS223 and FMVSS224.

FMVSS223: https://www.ecfr.gov/cgi-bin/ text-idx?SID=7d443eb75ceba033fed91e90f81 6b574&node=se49.6.571_1223&rgn=div8

FMVSS 224: https://www.ecfr.gov/cgi-bin/ text-idx?SID=7d443eb75ceba033fed91e90f81 6b574&node=se49.6.571_1224&rgn=div8

For semi-trailer dealers and repair shops, FMVSS224 is especially important, as it provides installation requirements, whereas FMVSS223 outlines the manufacturer’s requirements. Note: Exempted from the rear impact guard requirement are pole trailers, pulp- wood trailers, low chassis, special purpose trailers, wheels back vehicles, and trailers transported in a drive-away or tow-away operation.

Continued on Page 22… www.ntda.org 22 Clarifying Rear Impact Guard Confusion

HOW WE GOT HERE state inspectors with ramping up inspection that otherwise satisfies the safety/perfor- of rear guards and to be more diligent in mance requirements but has a missing or As NTDA wrote in TrailerTalk, in 2017, Senators determining if a guard should be declared torn label doesn’t technically satisfy all the Gillibrand and Rubio introduced the Stop “out-of-service.” Unfortunately, since a manu- requirements. That’s exactly what’s started to Underrides Act (S.2219), a bill that would facturer’s label is required on rear guards, as happen: Some inspectors are citing trailers require trucks weighing more than 10,000 lbs. proof it was designed to meet the standard, because there’s no label. to install side underride guards and requested many inspectors began citing a semi-trailer The label must include the trailer manu- the CVSA raise the standard for rear guards. (or owner) if the label was missing or couldn’t facturer’s name and address, month and year The bill was particularly mindful of citing any be read — no matter the condition of the the trailer was built, and include “DOT,” which trailer with a rear guard that might be in need guard itself. constitutes the manufacturer’s assurance of repair due to rust, corrosion, cracks, and That led to fears of repair shops being held the guard satisfies the safety/performance the like. partly responsible in situations where they requirements detailed in Motor Carrier safety “Many lives are still lost in underride correctly repaired or reinstalled a guard, but regulation 393.86 (49 CFR 393.86, sections 1 crashes due to a lack of enforcement,” the that guard didn’t have the original manufac- and 6, specifically). Effectively, the rear guard two Senators stated in a letter to the CVSA. turer’s label. What happens if that semi-trailer must be made specifically for that trailer — They noted that the federal standards for was involved in an accident? which only the trailer’s original manufacturer semi-trailers equipped with underride guards Inspectors were just following what they makes. (There are very specific rules for how have been in place since 1996 and sought a thought were the rules. Federal standards the guard must be installed, though these can tougher safety standard. for semi-trailers equipped with underguards be followed by trained service staff.) A problem with the Senators’ request was have been in place since 1996. The require- The label, in effect, is the manufacturer’s way that the CVSA acknowledged, “There are ments are detailed in FMVSS regulations (49 of stating the guard is fully compliant. Like- (already) federal requirements on size, place- CFR 393.86, Sections 1 and 6, specifically). wise, the label is the only way an inspector ment and condition of the rear underguards, One requirement is that on the guard itself can know for sure if the guard is compliant CVSA does not have a handle on how vigor- there must be an official label that lists the with regulations. ously inspectors are checking the under- trailer manufacturer’s name and address, In the U.S., the rear impact guard certifica- guards or issuing violations when they’re beat month and year the trailer was built, and the tion label is applied at the time of the trailer up, bent or have lost bolts.” word “DOT.” This label in effect constitutes manufacture to certify the guard complies In other words, they weren’t sure if the the manufacturer’s assurance that the guard with FMVSS 223 and is installed as required guards were being well-maintained and thus meets all the government’s safety and perfor- by FMVSS 224. These requirements include working as intended. This set in motion a mance requirements. connection points, guard width and height, decision to have more vigorous enforcement However, a narrow interpretation of these and other factors. They also require the certifi- of rear impact guards. The CVSA tasked its rules could lead to a situation where a guard cation label. The label must state: Continued on Page 24…

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Untitled-2 1 5/20/2019 12:33:56 PM www.ntda.org 24 Clarifying Rear Impact Guard Confusion

• Manufacturer’s name and address • The statement “Manufactured in (month/year)” • The letters “DOT.” After a good deal of push back, the CVSA agreed that a semi-trailer shouldn’t be cited just because of a missing label.

GAO REPORT ON REAR AND SIDE GUARDS

In March 2019, the U.S. Government Accountability Office (GAO) issued a “Truck Underride Guards” report that provides additional insight on the benefits of rear guards on semi-trailers. The report’s findings and recommendations are summarized below. Full .pdf of the document can be found at: https://www.gao.gov/assets/700/697585. the side of the trailer. About 21% occur GAO RECOMMENDATIONS pdf. at the front of the truck. The exact numbers It’s worth reviewing their findings, both aren’t known, but GAO estimates most of • In its report, the GAO recommends NHTSA in light of recent confusion over rear guard these fatal crashes occur at speeds develop a standardized definition of label requirements, and to understand the exceeding 55 mph — a higher speed than underride crashes and specify underride as potential benefits and concerns of rear guards even current rear guards are designed and side guards on semi-trailers. a recommended data field in crash reports. to mitigate. (State and local police crash reports • Newer cars with automatic braking systems currently include a field for underride GAO FINDINGS and adaptive cruise control should reduce crashes, but they are often not completed.) the number of underride crashes. • The GAO also recommends NHTSA provide • Semi-trailers are required to have rear • There is a strong push to include the rear training and guidance to state and local guards that can withstand the force of a guard as part of a semi-trailer’s road police departments on how to properly passenger vehicle crash up to about inspection. If this became the standard, and consistently identify and record 30 mph. The National Highway Traffic then if the rear guard fails inspection, the underride crashes. Safety Administration (NHTSA) has pro trailer can be taken off the roadways. • Like the recent CVSA recommendation, the posed strengthening rear guard require- • There are no federal side or front underride GAO recommends rear guards be ments in the U.S. to align with Canada’s guard requirements in the U.S. The cost of inspected as part of annual commercial stronger absorption requirement, but GAO sides guards, plus the added weight, which vehicle inspections. This is understandable. estimates that 95% of all newly manufac- may increase fuel consumption and green GOA notes that of the 5.8 million violations tured trailers in the U.S. already meet these ship smarter house gases, has kept NHTSA from issued in roadside inspections in 2017, only proposed requirements. requiring side guards on semi- 2,400 (0.042%) were for rear guard viola- • NHTSA estimates that the cost of a rear trailers. Trucks in Europe are required to tions. However, when CVSA asked inspect- guard that meets the Canada standard is have front guards, but similar trucks in ors to deliberately focus on read guards NTDA members save on small package, approximately $500 per semi-trailer, while the U.S. have a bumper and lower frame during a five-day period in 2018, of the the cost of meeting the actual lower U.S. that may mitigate the need for front guards 10,000 trailers inspected, about 900 viola- LTL, and full truckload shipments standard is approximately $275. and would not be a cost-effective safety tions (28%) were for rear guard dimen- • The Canadian standard rear guard weighs enhancement. sional or structural concerns, including 500 from 191 lbs.–300 lbs., compared to the U.S. • GAO estimates the cost of semi-trailer side instances where the rear guard was cracked standard rear guard that weighs about guards to start at $2,500, and weigh or broken or missing altogether. 172 lbs. Enroll today at between 575lbs.–800 lbs. If side guards be • The GAO also recommends NHTSA conduct • Underride crash fatalities account for less come required, their added weight may more research on side guards to better than 1% of total traffic fatalities and about force carriers to put more trailers on the understand their potential effectiveness 5% of fatalities related to large truck roads to ship goods just to keep under and associated costs. (Until then, the GAO PartnerShip.com/94NTDA crashes. However, this is probably an current federal maximum weight makes no recommendation that side undercount since many police depart- restrictions. Likewise, the stress of the guards be mandated or encouraged on ments fail to adequately label crashes. weight of side guards could slightly reduce semi-trailers.) • According to GAO, approximately 45% of the lifespan of a trailer and/or increase its fatal “underride crashes” occur at the rear maintenance costs. of the trailer. About 32% occur at

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NTDA(7792)DirectoryAd-8.5x11.indd 1 6/8/18 12:07 PM www.ntda.org 26 The Trailer Economy — Q3 2019

Last year was a very good year for the semi- bringing down the economy so negatively, ever-better value proposition compared to all trailer industry. So far this year looks fine, that we’re probably still not at a peak. other modes of delivery. In other words, long- but with the economy is cooling and freight It’s also worth remembering that all the term it seems like a growing pie plus an even is being impacted by tariff wars, border new technologies and new business models, better value proposition for the semi-trailer skirmishes, new technologies and potential along with all the money Silicon Valley and industry. That’s a pretty strong 1-2 punch new trade deals. The good times arrive with others are pouring into freight, logistics, and should translate into long-term gains for uncertainty. supply chain optimization and e-commerce, NTDA members. The record economic expansion, now in its may very well create some near-term pain Speculation aside, here’s what the current 123rd month, cannot go on forever. Second for the industry, as they make better use of major economic signals are telling us. quarter gross domestic product was up 2.1%, existing semi-trailer stock. However, for those Spoiler: the economy is fine but showing the weakest number since President Trump playing the long game, freight optimization, signs of weakness that could lead to some- took office. That said, it was still growth. Plus, autonomous trucking, platooning and other thing bad, like a 2020 recession, should there’s talk of a lowering the interest rate, technologies are likely to both grow the policymakers falter or the global economy maybe twice this year. It’s worth keeping in overall economy — great news for the semi- gets whacked. mind that the 2008 recession was so bad, trailer industry — and make semi-trailers an

TRAILER ORDERS 60,000

56,000

50,000

46,000

40,000 40,000

35,500

32,000 30,000 28,000 26,300 27,500 28,000 24,000 26,300 23,000 22,200 20,000 18,600 2019 2018

13,500 13,200 11,700 10,000

0 Source: FTR Transportation Jan Feb March April May June July Aug Sep Oct Nov Dec Intelligence: Trailer Orders TRAILER ORDERS

If you can ignore 2018, this year’s trailer orders numbers look fine. It’s just that comparing them to the blistering pace of 2018 makes it appear as if the future of the industry is being pum- meled. That is not the case, however. Orders aside, FTR predicts 322,000 trailers to be built this year, and about 285,000 in 2020. Lots of product to be sold to eager buyers. Plus, heavy-duty truck sales are trending above last year’s, another sign that more semi-trailers will be put to good use.

Continued on Page 27… Q3, 2019 27 The Trailer Economy — Q3 2019

Truck Tonnage Index 140.0

120.0

100.0

2019 Vs. 2018 Vs. Baseline 80.0

60.0

40.0

20.0

0.0 Source: American Trucking Jan Feb March April May June July Aug Sep Oct Nov Dec Associations: Truck Tonnage Index TRUCK TONNAGE INDEX

Truck tonnage serves as a barometer for the overall economy since over 70% of domestic freight is hauled by tractor-trailers. Above 100 is generally a positive signal. The current numbers, while a drop off from the previous six months, reveal the economy is still humming.

Manufacturing Index 70.0

60.0

50.0

2019 Vs. 2018 Vs. Baseline 40.0

30.0

20.0

10.0

0.0 Jan Feb March April May June July Aug Sep Oct Nov Dec Source: Institute for Supply Chain Management MANUFACTURING INDEX

A reading above 50 means that manufacturing production is growing, while anything below 50 indicates a decline. The current numbers show that manufacturing is off from last year but still in positive territory…barely. A boost from new trade deals or a massive infrastructure bill could be a major shot in the arm. Continued on Page 28… www.ntda.org 28 The Trailer Economy — Q3 2019

Manufacturing Index 70.0

60.0

50.0

2019 Vs. 2018 Vs. Baseline 40.0

30.0

20.0

10.0

0.0 Jan Feb March April May June July Aug Sep Oct Nov Dec Source: Federal Reserve INDUSTRIAL PRODUCTION

An economic signal like the manufacturing index, the Federal Reserve’s industrial production index measures output across the nation’s industrial sector, which in this case includes manufacturing, mining and utilities. It’s still a useful economic signal for the semi-trailer industry. A number above 100 is generally positive news and the news remains positive.

FTR Hosting Economic Outlook Conference

The NTDA is proud to be a be able to network with transportation Gold Sponsor of the Freight professionals from all parts of the supply Transportation Research chain, but they will return from the Economic Outlook conference with actionable information Conference, Sept. 10–12, for their businesses,” said Eric Starks, FTR 2019 at the historic Union Chairman and CEO. Station in Indianapolis, IN. To register for the FTR Economic Outlook Eric Starks “This year’s program Conference, visit https://www.ftrconference. will continue to bring com/. together many of the leading experts in Starks will also deliver an Economic the transportation industry. There are Overview at the 29th Annual Convention fundamental changes on the horizon for during the General Session on Thursday, Oct. freight transportation, and will help lead 10 at The Breakers. For more information and discussions on how companies are dealing to register, visit https://ntda.org/convention/ with these changes. Not only will attendees register/, or call 1-800-800-4552. Insurance Solutions for the Trailer Industry

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