Owner-Operator Independent Drivers Association
1 NW OOIDA Drive, Grain Valley, MO
E-mail:ooida@ooida.com
Web site: www.ooida.com
Phone: (816) 229-5791 Fax: (816) 427-4468
OOIDA urges U.S. International Trade Commission to consider the negative economic impact of opening border to Mexican trucks
July 27, 2006, Grain Valley, MO – "The net effect of admission of Mexican trucks into the U.S. marketplace would undoubtedly be negative."
That’s the message the executive vice president of the Owner-Operator Independent Drivers Association (OOIDA) delivered in testimony he submitted to the U.S. International Trade Commission on July 13.
The ITC is an independent, nonpartisan, quasi-judicial federal agency that provides trade expertise to both the legislative and executive branches of government.
In his written testimony, OOIDA Executive Vice President Todd Spencer ran down the list of numerous concerns of the nation’s professional truckers, whom OOIDA represents.
The concerns include:
- negative impact on driver pay;
- negative impact on highway safety; and
- a lack of enforcement of existing regulations should Mexico-domiciled trucks and trucking companies be allowed to operate with free reign on U.S. highways.
Laws governing the trucking industry restrict trucks and drivers from Mexico and Canada to carrying international shipments between their home countries and individual points in the U.S. Those same laws prohibit foreign trucks and drivers from moving loads from point to point within U.S. borders.
But, Spencer pointed out to the members of the ITC, if those regulations and immigration rules are not enforced, the competition from foreign trucks and drivers would overwhelm the U.S. trucking industry.
The main reason that will happen is simply because Mexican drivers will be paid much less than U.S. drivers, Spencer testified. He cited studies that estimate the pay of Mexican truckers only 25 percent to 50 percent of the amount that U.S. drivers receive. Spencer said the prospect of having access to drivers who would accept lower pay will be an enticement to brokers and motor carriers to hire and utilize Mexican truckers rather than U.S. truckers.
With pricing in the industry determined by the supply and demand of available trucks, Spencer explained to the commission that the use of cheap Mexican labor by competitors in the industry would drive down rates paid to motor carriers and their drivers. Even if only a minimal number of companies cash in on the cheap labor, Spencer said, the effect would be a significant reduction in the income of professional drivers.
And to further complicate the entire driver pay problem, Spencer informed the International Trade Commission members on the current "driver shortage" in the industry.
"U.S. motor carriers maintain that there is currently a shortage of skilled truck drivers in the United States," Spencer wrote in his testimony. "The principal reason for this shortage is the difficult working conditions and the low driver pay. Allowing Mexican trucks and drivers into the United States will only worsen the problem of low pay and the ability of the U.S. industry to keep and attract qualified drivers."
Spencer also urged committee members to understand there would be an enormous impact on highway safety if Mexican trucks and drivers were allowed to operate in the U.S. If U.S.-based trucking companies have less revenue because of the Mexican competition they will have less money for maintaining fleets, ultimately showing up as a decrease in the quality of equipment on the road.
He also pointed out the Mexican government’s resistance to proper regulatory oversight of the Mexican motor-carrier industry, both in terms of equipment and in the differences in requirements for U.S. drivers and Mexican drivers.
"U.S. drivers are required to pass regular medical tests in order to maintain their commercial driver’s licenses," he wrote. "There is no similar requirement imposed on Mexican drivers who drive in the U.S."
Spencer concluded his arguments by highlighting the general negative impact on the economy that opening the border could have.
"The displacement of U.S. drivers would put pressure on wages in other semi-skilled occupations in the United States. The loss of income by truckers would affect the state and local tax bases and would likely place additional burden on social services that states and localities provide," he concluded.
Founded in 1973, the Owner-Operator Independent Drivers Association (OOIDA) is comprised of more than 142,000 owner-operators, professional drivers, and small-business truckers from all 50 states and Canada. OOIDA represents the interests of this nation’s more than 350,000 small-business trucking professionals in the legislative and regulatory processes at both federal and state levels.
Contact: Todd Spencer
(800)444-5791
Fax (816) 229-0518
1 NW OOIDA Drive
Grain Valley, MO 64029