GAO: Trucking the least efficient mode of freight shipping

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GAO: Trucking the least efficient mode of freight shipping

by Tanya Snyder • March 1, 2011 1:52 pm

Freight transportation, which accounts for nearly a quarter of transportation-related greenhouse gas emissions, doesn't get as much attention as passenger transportation because most people don't feel it affects them as much. But more than 15 million trucks deliver 70 percent of the goods this country consumes—and the GAO says that's a mistake.

Safety is one of many externalized costs of freight trucking. Photo from Truck Accidents 360 Newswire.

The Government Accountability Office published a study finding that the costs of freight trucking that are not passed on to the consumer are at least six times greater than the equivalent rail costs and at least nine times greater than the equivalent waterways costs.

Many of those are externalized costs passed on to society—like congestion, pollution, and crashes—as well as public costs, like infrastructure maintenance. These externalized and public costs are just another way that taxpayers subsidize highways. The GAO implies that the country's highway-centric transportation policy could be damaging the economy.

"When prices do not reflect all these costs, one mode may have a cost advantage over the others that distorts competition," writes the GAO. "As a consequence, the nation could devote more resources than needed to higher cost freight modes, an inefficient outcome that lowers economic well-being."

The report goes on to say, "If government policy gives one mode a cost advantage over another, by, for example, not recouping all the costs of that mode's use of infrastructure, then shipping prices and customers' use of freight modes can be distorted, reducing the overall efficiency of the nation's economy."

The GAO didn't make recommendations in this report but did say that policy changes that make prices align with the true costs of freight shipping would provide a great economic benefit. Less targeted changes, like charging user fees, subsidizing more efficient alternatives, or applying safety or emissions regulations—could be helpful as well. The report acknowledges that "the current configuration of transportation infrastructure can limit the shifting of freight among modes."

After all, we've been building a lot more highways than railroads lately.

Cross-posted at Streetsblog Capitol Hill.

15 comments

Tags: economics, GAO, trucking

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Tanya Snyder is editor of Streetsblog Capitol Hill, which covers issues of national transportation policy. She previously covered Congress for Pacifica and public radio. She lives car-free in a transit-oriented and bike-friendly neighborhood of Washington, DC.

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Shipping freight by bicycle is the most efficient means of transport.

by JJ on Mar 1, 2011 2:10 pm • link • report

Rail is not really suited to local deliveries within a metro area. It’s much more practical for long deliveries. Even then a truck has to take the goods to some sort of train transfer station first.

I think this is starting to change however as gas prices are higher and higher. Rail uses on average about 30% less fuel then trucks do.

by Matt R on Mar 1, 2011 2:14 pm • link • report

Moving freight to other modes would likely involve governments subsidizing them somehow, like building rail lines or ports. More than 80% of communities in the U.S. rely solely on trucks to bring them freight, so you'd probably need to build or upgrade rail lines to get to them.

by Tim on Mar 1, 2011 2:15 pm • link • report

Yes but:

1. Space in cities for intermodal hubs is strictly limited.

2. Intermodal hubs are typically located in EJ communities.

3. Intermodal hubs typically generate inordinate amounts of NoX, SoX and other air and particulate contaminants, increasing health issues in those EJ communities.

4. Our rail infrastructure is antiquated and in serious need of modernization and investment.

5. Balance freight rail with passenger rail and you get a whole other set of issues.

by Redline SOS on Mar 1, 2011 2:18 pm • link • report

"Freight shipping" in the abstract is kind of vague. What kinds of trips are we talking about - last mile delivery or cross-country shipping? What kind of time pressure is there? Obviously, lots of modes will be faster than a barge on a river. What about the constraints of the package itself? I can easily air-mail a small package, but I can't do that for tons of various bulk cargoes.

by Alex B. on Mar 1, 2011 2:18 pm • link • report

Umm, no gas tax? Seems like an easy way to balance the equities.

by charlie on Mar 1, 2011 2:18 pm • link • report

Also, did the report really say that trucking is the LEAST efficient mode? What about air? And, as Alex B. said, what about things like time? Obviously my watch can get from Asia to the Navy Yard completely by water if you want it to and use almost no fuel in the process, but I'd probably choose air.

by Tim on Mar 1, 2011 2:22 pm • link • report

Umm, no gas tax? Seems like an easy way to balance the equities.

Uhh, removing the gas tax would INCREASE the inequality between trucking and other modes of freight shipping. Because trucking would be paying less for the maintenance of the roads.

Also, for those of you saying "what about air?", air moves several orders of magnitude less freight than other modes. UPS and FedEx move something like 10 million ton-miles of freight every year (and they are by far the biggest), waterway transportation moves 55,000 times that amount. Air is a blip.

by MLD on Mar 1, 2011 2:37 pm • link • report

Rail is incredibly efficient. Part of the reason US freight rail is so efficient compared to, e.g. Europe, is because of the atrophy of US passenger rail. If they want to build a new hi-speed rail network, it should be separate from the freight network.

by SJE on Mar 1, 2011 2:43 pm • link • report

@ MLD; actually, I was suggesting that the report should have included a direct call for a higher gas tax.

It's hard; gas tax on commercial vehicles is where costs start to really jump up for everyone. Look at what airlines are doing, and they don't pay tax.

15 million trucks? they mean semis? What about all the vans, pickups and everything else being used?

by charlie on Mar 1, 2011 2:46 pm • link • report

Let's also remember that the railroads, by and large, do their own investment. They are responsible for efficient transportation and reap the benefits (or suffer the consequences) for poor maintenance/investment.

The GAO report also says "other stakeholders" should step up and fund transportation more efficiently. This includes private rail firms as well as state/local governments.

Note that both the GAO and the Joint Committee on Taxation suggest efficiency could be improved if we reduced or eliminated many tax expenditures.

by WRD on Mar 1, 2011 2:52 pm • link • report

They are responsible for efficient transportation and reap the benefits (or suffer the consequences) for poor maintenance/investment.

That statement would be a whole lot more true if Conrail never happened, and if the government didn't occasionally fund private freight rail projects.

by andrew on Mar 1, 2011 4:18 pm • link • report

@ Matt R: And yet, Amsterdam has taken to using streetcars at night to deliver stuff to downtown places. Why? They're more efficient, more quiet and better for the environment, and unused during night time. I recently also saw a clip from a car factory in Dresden that has all of its deliveries done by streetcar.

@ WRD: Let's also remember that the railroads, by and large, do their own investment. They are responsible for efficient transportation and reap the benefits (or suffer the consequences) for poor maintenance/investment.

And they get massive subsidies from states and the feds. Just look back to the GGW posts about the upgrades of the local rail system. At least half of the money comes in the form of subsidies, just like with metro and transit.

by Jasper on Mar 1, 2011 8:20 pm • link • report

Don't get me wrong, there's always room for improvement, but isn't this one area that we're actually doing a pretty good job? As the report says, rail accounts for about 41% of the ton-miles of freight shipped, compared to 46% by truck.

While that maybe doesn't sound terribly great, the rail share accounts for only about 8% of ton-miles shipped in Europe.

by Andy R on Mar 1, 2011 11:06 pm • link • report

The freight transport industry is one of the few that pursues efficiencies wherever it can. What nearly killed freight rail back in the day was a number of regulations that made it impossible for the markets to perform properly. Europe's a good example of what results.

I'd like to see trucking be reduced to a minimum, but in this area we're doing far and away better than elsewhere. It's nice to actually be best at something progressive.

by OctaviusIII on Mar 2, 2011 12:01 am • link • report