Trucking Trends

Money and Tons Revenue:  $681.7 billion in gross freight revenues (primary shipments only) from trucking, representing 81.2% of the nation’s freight bill in Tonnage:  9.7 billion tons of freight (primary shipments only) transported by trucks in 2013, representing 69.1% of total domestic tonnage shipped.

Taxes-Our Fair Share Taxes:  $37.8 billion paid by commercial trucks in federal and state highway-user taxes in  Commercial trucks make up 12.8% of all registered vehicles, and paid $17.6 billion in federal highway-user taxes and $20.3 billion in state highway-user taxes, in  Combined Local, State and Federal Gas Tax in KY ranks 13 th in the U.S.  Kentucky ranks 3 rd nationally in highway user fees.  Trucking Registration equal 65% of total registration fees in KY  46% of State and Federal Highways fees come from trucking

There Are A Bunch Of Trucks Number of Trucks:  32.1 million trucks registered and used for business purposes (excluding government and farm) in 2012, representing 24.4% of all trucks registered.  2.3 million Class 8 trucks used for business purposes (excluding government and farm) in  11.7 million commercial trailers registered in  20,000 + IRP vehicles in Kentucky

Trucking Companies Number of Companies:  According to the U.S. Department of Transportation, as of September 2013,  For-hire carriers 465,697,  Private carriers totaled 725,179  Interstate motor carriers totaled 164,723.  90.1% operate 6 or fewer trucks.  97.1% operate fewer than 20 trucks.

How Does Freight Move In Kentucky? Total Freight Tonnage 169,456,120 Inbound Freight 45% Outbound Freight 55% Trucking 76.53% Rail 10.29% Waterways 10.78% Intermodal.88% Air 1.52%

In Cab Communications Vehicle to Vehicle & Vehicle to Infrastructure Collison Avoidance Technology Platooning Self Driving Vehicles Hot Spots E-Screening

Safe and Efficient Transportation Act 97,000 Pound Trucks? States Will Still Control 44 States Already Allow Heavier Trucks Highway Stress Safety Concerns 60 foot 6 inch Walmart Super-Cube Rig

Trucking Trends Trucks will continue to dominate the transportation of general commodities Anticipate truckload carriers will boost their use of railroads For Hire Carrier tonnage will increase annually by 3.3% LTL average annual growth expected to be around 3.5% for the next 5 years. Private carrier volume is slated to expand 2.8% per year for the next 5 years.

Louisville 2,000 Truck Sample

Same 2,000 Trucks After 24 Hours

Same 2,000 Trucks After 72 Hours

Same 2,000 Trucks After 5 Days

Same 2,000 Trucks After 7 Days

Big Time Fuel Users

Trucks Use a Lot of Fuel In 2013, trucking consumed 52.7 billion gallons of fuel – 37.7 billion gallons of diesel (72%) – 15.1 billion gallons of gasoline (28%)

Reducing Tire Resistance

Reducing Trailer Resistance

Diesel Price “Spiking” Intensifying! The number of times the week-to- week change in the national retail diesel price exceeded 5 cents (up or down) 1990s: once in 302 weeks (0.3%) 2000s: 95 times in 521 weeks (18.2%) 2010s: 42 times in 186 weeks (22.5%)

Large On-Highway Diesel Fuel Bill Annual diesel costs were $87 billion (2009); $109 billion (2010); $143 billion (2011); $156 billion (2012); $149.5 (2013)  1¢ diesel  increase = $350 - $375 million in added fuel costs to industry

Is Natural Gas a Viable Fuel Option for Trucking?

Outlook Remains Positive

Top 10 Reasons Natural Gas Looks Promising for Trucking Roughly $1.00 (LNG) - $1.50 (CNG) cheaper per DGE Domestically-produced Vast supplies readily available Future cost projections remain low Fuel surcharges roller-coaster Manufacturers have/will have product lines Fleet requests for natural gas trucks is on the rise Infrastructure build-out continues OEM competition will decrease equipment costs and fleet competition will increase market penetration of equipment Lower emissions

Natural Gas Use in Transportation is Not a New Concept

First U.S. Well Dug in 1821 William Hart dug the first well specifically to produce natural gas in the U.S. in the Village of Fredonia on the banks of Canadaway Creek in Chautauqua County, NY. It was 27 feet deep, excavated with shovels by hand, and its gas pipeline was hollowed- out logs sealed with tar and rags.

The 1920’s “Cutting Edge” Car

Further Advances in the 1930’s

1980’s Chinese Natural Gas Vehicles

To the Present …

Issues for States Fracking bans Vehicle weight exemptions State tax incentives and grants Truck safety concerns Road degradation Taxation of natural gas Note: fracking-associated hauls provide significant economic boon for tank truck industry (≈2000 hauls per fracked well)

Contact Information Jamie Fiepke KMTA President/CEO