Trucking companies are eager to see President Donald Trump’s $1 trillion infrastructure pledge become a reality, arguing upgrades to America’s highways will lift the industry and the U.S. economy.
While the fine print has yet to be seen, the new administration’s promise to introduce to Congress a $1 trillion infrastructure spending bill has been met with encouragement from some businesses that rely on roads, bridges, railways and airports.
“The president has already started removing the regulatory roadblocks that have been killing projects before they’ve even begun through his executive actions, streamlining the permitting process and calling for each agency…to identify regulations that cause undue burden,” White House spokesman Sean Spicer said Wednesday.
According to the American Society of Civil Engineers, deficient roads will cost business $1.1 trillion in added expenses by 2040. The impact to the entire economy is estimated at $3 trillion.
For truckers, bumpy and congested roads prove costly. Poor road conditions add $49.6 billion in costs to the trucking industry, according to the trade group American Trucking Associations (ATA). Another $100 billion is lost due to congestion.
“The lack of investment in infrastructure is having an effect on not only safety, but the economy,” Chris Spear, ATA’s president and CEO, told FOX Business. “When we talk about offsets and return on investment, it’s absolutely a no-brainer.”
Industry representatives say investing in new roads and repairs will pay dividends, noting that trucks move 56% of the country’s GDP and roughly one of every 16 jobs can be found in trucking. Not to mention, consumers spend billions of dollars each year to fix pothole damage and other effects of bumpy roads, based on data from AAA.
The ASCE has long urged Capitol Hill and state legislatures to boost infrastructure spending. America’s infrastructure received a grade of D+ in the ASCE’s 2013 report card. Roads (D) and bridges (C+) both received poor grades, and the ASCE estimates that 42% of major urban highways remain congested.
The ASCE, which has called for $3.6 trillion in spending by 2020, is due to release its newest report card Thursday.
In his address to Congress last week, Trump reiterated that he will ask lawmakers to pass a bill that plows $1 trillion into infrastructure projects over a 10-year period. The plan would be financed through public and private funds, the president said. Trump hosted a meeting at the White House Wednesday to discuss infrastructure investments with several private-equity leaders. Elon Musk, the CEO of Tesla (NASDAQ:TSLA) and SpaceX, was also present.
Given the president’s support for infrastructure spending, optimism has engulfed transportation and logistics companies since the election. Shares of J.B. Hunt (NASDAQ:JBHT) are up 14%, while XPO Logistics (NYSE:XPO), which acquired trucking firm Con-way in 2015, has surged 37%.
Still, Trump’s plan faces the usual speed bumps on Capitol Hill, as divisions have already emerged over how it will pay for an infrastructure bill. Support is likely to come from both Republicans and Democrats, though, and the trucking industry is pushing for a solution.
“This is the one issue that most Americans and most people in D.C. would agree on as a bipartisan issue,” Spear said. “We haven’t seen anything this bold since the Eisenhower era. Our industry, frankly, is delighted. We feel very strongly about the proposal, and we are going to aggressively support its passage.”
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