Heavy Duty Trucking, November 2018

HDT NOVEMBER 2018 12 WWW TRUCKINGINFO COM NAFTA deal delivers good news for trucking David Cullen Executive Editor dcullen@ truckinginfo com David covers legislative and regulatory issues for Truckinginfo com and HDTs monthly Washington Watch as well as writing substantive features for the magazine on management issues equipment trends and more He can be reached at dcullen@ truckinginfo com or 203 371 0040 he new trilateral free trade deal announced on Sept 30 is allowing North American trucking operations to breathe easy again After months of uncertainty over whether NAFTA would become unraveled and do inestimable harm to the economies of the United States Canada and Mexico there is tangible relief that an agreement has been reached that is satisfactory to all three sides What is more good news is that the agreement appears to be a revision not a rejection of the widely praised treaty thats been in effect since Jan 1 1994 NAFTA broadened the free trade agreement the U S and Canada had in place since 1989 adding Mexico as a signatory During the 2016 campaign Donald Trump promised that if elected he would renegotiate NAFTA which he termed perhaps the worst trade deal ever made He largely blamed it for the loss of manufacturing jobs in the so called Rust Belt states that he most needed to win the White House While much drama over how to replace NAFTA made it into the headlines for more than a year nonpartisan experts observed that with the original treaty being almost 25 years old it was certainly due for some tweaking to keep it in tune with changing times This is another victory of common sense over posturing said Steve Nelson partner at the international law firm Dorsey Whitney and a former U S State Department lawyer As in the case with Mexico the NAFTA terms with Canada clearly needed rebalancing in light of 25 years of experience That doesnt mean the original agreement was a bad deal for the U S but reflects the fact that the patterns of trade as they evolved resulted in a need for some changes The Motor and Equipment Manufacturers Association which also includes the Heavy Duty Manufacturers Association noted in a statement that NAFTA was due for modernization while ensuring the open and free market our members rely upon to remain globally competitive The potential strength and longevity of this agreement will be in the details The trilateral deal is expected to affect automakers the most It requires a larger portion of vehicles to be made in North America sets a minimum fixed wage for auto workers and forces Canada to effectively cap its automobile exports to the U S The new agreement dubbed the United States Mexico Canada Agreement or USMCA at last took form late in the evening of Sept 30 when Canada agreed to sign onto a trade deal already hammered out between the U S and Mexico There had been a self imposed Sept 30 deadline to reach a deal To go into effect the treaty must still be ratified by the legislatures of all three countries The American Trucking Associations praised the governments of the three countries for coming together on a framework for continued free trade between the North American nations ATA is pleased that the United States Canada and Mexico will continue their nearly 25 year long tradition of free and open trade among North American neighbors said ATA President and CEO Chris Spear ATA Chief Economist Bob Costello said the new deal will continue to strengthen our collective economies and improve our relations Trucks move nearly 385 billion in goods between the U S and Mexico and 336 billion in trade across the Canadian border Continuing to have free trade between our three countries will only help our industry well into the future A spokesperson for Germanys Daimler AG parent of Daimler Trucks North America called the deal a win win arrangement with enormous benefits for both the United States and the other countries noting that it was still reviewing the text and that the legislative institutions in all three countries must approve it We continue to monitor the situation closely and are ready to take appropriate measures which are not intended to be discussed in public due to competitive reasons Analyst Avery Vise vice president of trucking for research firm FTR told HDT that while WASHINGTON WATCH The original treaty was certainly due for some tweaking to keep it in tune with changing times T