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Policy Group

Policy Overview

Transportation in Canada Annual Reports

Table of Contents

Report Highlights

1. Introduction

2. Transportation and the Canadian Economy

3. Government Spending on Transportation

4. Transportation and Safety

5. Transportation - Energy and Environment

6. Transportation and Regional Economies

7. Transportation and Employment

8. Transportation and Trade

9. Transportation and Tourism

10. Transportation Infrastructure
11. Structure of the Transportation Industry
12. Freight Transportation
13. Passenger Transportation
14. Price, Productivity and Financial Performance in the Transportation Sector

Minister of Transport

Addendum

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Transport Canada

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12

FREIGHT
TRANSPORTATION

Trucking Transportation

Domestic vs International Traffic

Since 1991, the number of tonne-kilometres attributed to for-hire carriers has increased steadily in both the domestic and international markets. Domestically, tonne-kilometres rose from 47.7 billion to 76.7 billion from 1991 to 1998, an average annual increase of 7.0 per cent. Internationally, tonne-kilometres rose from 22.9 billion to 61.4 billion, an average annual growth of 15.1 per cent over the same period.

In light of these increases, the relative importance of domestic and international markets in the total traffic of Canadian-based for-hire trucking firms has been shifting in the past decade. Since 1991, the domestic share of total tonne-kilometres has decreased by 15 per cent, resulting in a corresponding increase in the international share of total tonne-kilometres.

Figure 12-4 shows the growth in annual truck traffic in tonne-kilometres between 1988 and 1998.

Table 12-2 shows the amount of for-hire truck traffic by sector and province for 1998. Ontario accounted for the largest share of truck traffic in both domestic and international markets, with 51.3 billion tonne-kilometres, or 37.1 per cent of the total tonne-kilometres.

Table 12-3 shows the northbound and southbound flow of traffic between US regions and Canadian provinces in 1998. Deliveries to and from the US central states accounted for the largest share of traffic with 22.1 billion tonne-kilometres, or 36.0 per cent of the total tonne-kilometres.

Truck Traffic by Commodity

In terms of transportation revenues, general freight (primarily manufactured products and fabricated materials) accounted for a significant share of truck traffic in 1998. Domestic traffic in this commodity group generated close to $2.7 billion in revenues, or 41.5 per cent of all domestic revenues. International traffic generated approximately $2.2 billion, or 46 per cent of all international revenues. Based on domestic and international traffic combined, the next most important commodities transported were food products, with about $1.8 billion, or 16.2 per cent of the total, and forest products, with $1.6 billion, or 14.3 per cent of the total. Together, these three commodities accounted for almost three quarters of the carriers' revenues in 1998.

Table 12-4 shows the revenues of for-hire trucking activity by major commodity group for 1998.

In terms of traffic volume measured by tonne-kilometres, general freight accounted for 26.4 billion tonne-kilometres domestically, or 34.5 per cent of all domestic traffic, and 24.3 billion tonne-kilometres to the US and Mexico, or 39.5 per cent of all international traffic. Combined, this represented almost 37 per cent of total tonne-kilometres in 1998.

In aggregate, general freight, food products and forest products accounted for almost 75 per cent of carriers' total tonne-kilometres in 1998. Table 12-5 shows the volume of for-hire trucking traffic by major commodity group for 1998.

Two major sources were responsible for the growth in freight traffic carried by trucks: the general freight sector, where domestic activities not only surpassed transborder volumes in terms of tonne-kilometres, but were also responsible for much of the growth in freight traffic; and the food products sector, which enjoyed significant growth in both domestic and transborder flows.

Figures 12-5 and 12-6 compare domestic and international for-hire truck traffic for these two important commodity groups from 1990 to 1998.

INTELLIGENT TRANSPORTATION SYSTEMS
APPLICATIONS AND THE CANADIAN TRUCKING INDUSTRY

Given the increasing focus on Intelligent Transportation Systems (ITS), Transport Canada launched a study to assess best practices and state-of-the-art applications currently in use in the motor carrier industry. A summary of the study, which was completed in 1999, follows.

ITS can be defined as the application of advanced information processing, communications, sensing and control technologies to improve the way in which ground transportation systems are designed, built, managed and operated.

These technologies are being considered by the motor carrier industry as a way to enhance safety and efficiency of passenger and freight transportation operations, and to promote competitiveness. ITS applications have also been introduced to alleviate problems associated with increased traffic congestion, instead of capital expenditures to expand existing highway infrastructure.

Possible Barriers To Deployment of ITS Technologies

Despite carriers' awareness of the benefits of ITS technologies to their operations, a number of impediments exist to broader deployment of ITS.

  • Cost of investment in technology -- Because rapid technological changes make products quickly outdated, products must be sold at prices high enough to cover developmental costs, which deter many carriers from adopting them.
  • Knowledge of ITS -- The lack of knowledge about ITS also impedes investment, and Canada currently lacks the outreach programs that might help increase awareness.
  • Privacy issue -- Trucking companies are concerned about the storage of private and confidential commercial information.
  • Commercial issue -- Suppliers of ITS technology are concerned about protecting their intellectual property rights, as well as their market share.
  • Resistance to change -- Workers often equate automation with a potential loss of jobs, and therefore do not wish to change the way they do business.
  • Standardization -- The lack of standardization and the proprietary nature of some of the technologies and products have made it difficult, if not impossible, for the industry to integrate their company's systems with the in-vehicle devices. Similarly, operational policy and strategies are often developed with little consultation, resulting in individual institutions having similar but different requirements.

Current Uses of ITS Technology in Canada

There is a significant degree of adoption of ITS technology in the Canadian trucking industry. It is, however, generally limited to large companies operating a fleet of 100 trucks or more. The driving force behind its use is competitiveness considerations, particularly for carriers that have operations with a North American scope. Furthermore, adopting ITS technology improves their productivity and safety records, giving them a competitive edge in the market. There are several types of ITS applications in use in the Canadian trucking industry.

  • Computerized information system -- A high percentage of Canadian carriers use computerized management information systems to manage their operations.
  • On-board driver monitoring system -- This is an on-board computer with a serial PC interface used to transfer data to the fleet management computer to assess driver and vehicle performance.
  • Satellite tracking -- This is an on-board vehicle device that sends a periodic signal to the satellite. The communication satellite then establishes the approximate location of the vehicle, relaying this information to the dispatch office's tracking software.
  • Global Positioning System (GPS) -- With a GPS, the vehicle's on-board receiver triangulates its position based on signals received from three or more GPS transmitting satellites. The on-board computer then transmits the vehicle location to the dispatcher by communication satellite or other means. The GPS system is also being used to keep track of trailers. Functions such as doors opening or temperature of cargo can also be monitored in real time.
  • Digital pager systems -- Text messages can be sent directly to the driver using the satellite system or the cellular network.

Opportunities for ITS in the Canadian Motor Carrier Industry

Implementing ITS technologies on a national scale requires the full commitment of all levels of government and the trucking industry, and close co-operation between the public and the private sectors. Building on the experience and successes of the pilot projects, ITS deployment has been expanding in North America and can be enhanced to include additional features for future ITS applications in the Canadian motor carrier industry.

  • Roadside CVO stations -- The number of weigh stations capable of electronic bypass could be increased. The number of trucks to be equipped with transponders for toll payment, weigh station bypass and customs clearance are expected to increase significantly over the next few years.
  • Commercial fleet management -- The use of on-board computers could be extended to upload the driver routing slip, customer list, billing information, etc. Technologies used for vehicle tracking and communications could provide a basis for implementing "Mayday" capabilities in emergency situations.
  • Enroute driver information -- Transponders could interface with other on-board devices for display functions to display information to the driver, such as weather, traffic incidents, road sign information, etc.
  • On-board safety monitoring -- Safety systems could monitor the safety status for the vehicle (brakes, lights, tires, air pressure, speed, steering and electrical system), the driver (hours of service, alertness) and cargo (unsafe conditions relating to cargo carried in the vehicle).
  • Commercial vehicle administrative processes -- The carriers could electronically capture information on mileage, fuel purchased, and trip and vehicle data by province (and state), including licences, registrations, operating authority, leasing, insurance, permits, mileage and fuel tax reporting, safety records, audits and credentials.
  • Route guidance -- In-vehicle navigation systems using GPS will be an option for most trucks within a few years, providing vehicle location, mapping, traveller route planning and route guidance.
  • Dangerous goods incident response -- Transponders could enable the tracking of the movement of dangerous goods and provide truck-specific cargo information to enhance the response to dangerous goods incidents.

Conclusions

Commercial vehicle operators and their different agencies have a common interest in deploying ITS applications. However, a number of hurdles have to be overcome to achieve success. The perceived barriers from the motor carrier industry perspective can be addressed by the following types of action.

  • Education -- Increase awareness of the associated benefits of ITS technologies by promoting it through trucking associations and ITS Canada, focused government information campaigns (through vehicle registration and truck driver permit renewals, at roadside inspection stations, border crossings, etc.).
  • Regulatory -- Set guidelines to protect privacy and intellectual property.
  • National ITS Architecture -- Develop a national ITS architecture for integrating various commercial vehicle applications compatible with the US architecture, but taking into consideration the unique needs of Canada.
  • Public/Private-Sector Participation -- Foster co-operation and involvement of all sectors to better balance investments and increase market stimulation.
  • Harmonized Standards -- Develop North American standards and achieve true inter-operability.

Truck Fleet

Class 8 heavy trucks include those vehicles with a gross vehicle weight of 15,000 kilograms or more. There was a total of 262,226 Class 8 trucks registered across the country in 1999. To that figure must be added an additional 386,804 "heavy vehicles," which include those vehicles used for picking up and delivering goods and that weigh more than 10,000 kilograms. Three provinces, Ontario, Quebec and Alberta, accounted for 74 per cent of all Class 8 trucks registered in Canada in 1999, and 63 per cent of all registered heavy vehicles.

Truck Sales

In 1999, there were 30,984 new Class 8 trucks sold in Canada, establishing a new record for sales of such vehicles. These new truck purchases reflect a pent-up demand following the deferred fleet replacement during the 1990-1992 recession, as well as strong growth in the demand for truck freight services since 1993. Table 12-7 compares the sale of Class 8 trucks by province from 1997 to 1999.

Sales of Class 8 trucks were 6.5 per cent higher in 1999 than in 1998. A number of factors, favourable to heavy truck sales, that were present in 1998 -- strong manufacturing output, relatively favourable interest rates, controlled inflation and increased consumer spending -- were also present in 1999, all pointing to a strong demand for truck freight transport.

When Canadian sales of Class 8 trucks in a given year are related to the number of registered Class 8 trucks, it gives an idea of the importance of the replacement rate of vehicles in the trucking industry (Table 12-8). Replacement rates vary from one region to another, a situation that would have to be analysed at a micro-level to determine whether or not it is indicative of an appropriate or inappropriate rate of replacement. In Canada as a whole, more than 11 per cent of registered Class 8 trucks in operation during 1999 were new trucks.

Figure 12-7 shows the annual sale of Class 8 trucks in Canada between 1990 and 1999.

 

FREIGHT TRANSPORTATION

Rail Transportation

Trucking Transportation

Maritime Transportation

Air Transportation Industry


Last updated: 2004-04-02 Top of Page Important Notices