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Long Beach Moving on Trucks

TRANSPORTATiON: Port revs up plan to replace old rigs

Los Angeles Business Journal Staff

Despite an ongoing dispute with its sister port in Los Angeles over its truck replacement program, Long Beach is rapidly moving down its own road to put drivers behind the wheels of new, cleaner-burning trucks.

The Long Beach port recently issued a formal request for proposals to truck manufacturers and financial institutions that officials hope will partner with the port on its $2.2 billion program, which will replace the aging fleet of harbor trucks with vehicles that run on either “clean” diesel or alternative fuels, such as liquefied natural gas.

Big truck manufacturers will supply as many as 16,000 new rigs, while the financial houses will purchase and lease out the trucks either to independent owner-operators or to motor carriers. A preliminary RFP was issued March 7 that gives companies until April 3 to submit proposals. The port expects to announce participants in late April but details are still being worked out.

“This is focused on getting rubber on the road as far as clean trucks as rapidly as possible,” said Thomas Brightbill, a principal with CGR Management Consultants, who has been brought in by the port to help coordinate the program.

In late 2006, the ports announced a joint plan to clean the air in San Pedro Bay, with a key element being the replacement of fume-spewing diesel trucks that carry goods to local warehouses.

But the ports parted ways earlier this year over a labor-backed provision – still supported by Los Angeles officials – that would require the now-independent truck drivers to become employees of motor carriers. Motor carriers have resisted this move, which would open the door for drivers to unionize.

Long Beach, saying the employee model would get bogged down in the courts, decided to move ahead with a plan that gives drivers the option to remain independent.

Under the Long Beach model, independent drivers would directly lease or buy the new, heavily subsidized trucks. Alternately, motor carriers could buy or lease the trucks and have employees drive them.

Long Beach has contacted seven truck makers and about two dozen financial institutions to see if they would be interested in its version of the program.

Though the port will provide money to the program, the financial institutions that participate in the program will actually purchase the trucks initially. Wei Chi, the port’s assistant chief financial officer, said the port will simply “serve as an aggregator” in order to facilitate large volume purchases.

In seeking partners, the port has focused on companies that have participated in similar programs elsewhere, such as Bank of America Corp. The giant Charlotte, N.C.-based bank currently finances a federal program known as SmartWay Transport Partnership, which offers loans to trucking companies to purchase fuel-efficient technologies. Though the program has been successful, spokeswoman Colleen Haggerty said she did not know if the bank would submit a bid for the port’s program.

However, an executive with Kenworth Truck Co., one of the largest commercial vehicle manufacturers in the world, said the company was very interested in participating in Long Beach’s program, which is projected to cut harmful diesel emission by up to 80 percent from current levels.

“This represents a big opportunity,” said Andrew Douglas, western region sales manager for Kenworth, a division of Bellevue, Wash.-based Paccar Inc., which also owns truck maker Peterbilt Motors. “Kenworth builds a lot of trucks, so we certainly have the capacity and wherewithal to build to high levels. We still need to work through the (port’s bid) process, but it’s certainly our intent to respond.”


  February 8 - 14, 2010
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