The Ontario Trucking Association is applauding the recent MoU signed by Ontario and Michigan to promote industry collaboration, innovation and regional competitiveness and has pledged to work with both governments on how it can help increase supply chain integration.
In a letter to Ontario Premiere Kathleen Wynne and Michigan Governor Rick Snyder, OTA’s David Bradley says he is hopeful the agreement will help improve the efficiency, productivity, reliability and predictability of the supply chain directly, which impacts the economic competitiveness of the region and its attractiveness as a candidate for direct investment.
Trucking plays a critical role in Michigan-Ontario trade, carying almost US$40 billion by value, or 73% of all Michigan-Ontario surface trade, including 88% of Michigan exports to Ontario and 65% of imports from Ontario.
The role of trucking is particularly dominant in the transportation of auto parts directly to the assembly lines. The just-in-time inventory system, which remains to this day one of the key foundations of the auto sector’s – and therefore Michigan’s and Ontario’s competitiveness – is built around the availability of trucks to feed the supply chains on a time-sensitive/definite basis, Bradley wrote.
“Directly, and through the Canadian Trucking Alliance, we have worked hard with governments of all levels, their departments and agencies, as well as the bridge operators to improve throughput and to achieve an appropriate balance between security and efficient trade. We have worked with officials in Ontario and Michigan to ensure that non-income taxes on corporations doing business in both jurisdictions are consistent with international tax norms and therefore do not impair the competitiveness of the region.”
Bradley says there is more that can be done to enhance the competitiveness of automotive supply chains – without cost to the state or provincial governments.
“Michigan and Ontario are never going to – and don’t want to – compete on the basis of low wages, or by relaxing safety standards or by ignoring the environment. So to compete we have to be smarter, draw on our strengths and consider all other available opportunities.”
As an example, Bradley cited truck weights and dimensions standards which have been designed to increase the productivity and carrying capacity of trucks. “While the two jurisdictions may view truck weights and dimensions standards somewhat differently, compatibility is key.”
In fact, in Ontario’s approach to designing its Safe, Productive & Infrastructure-Friendly (SPIF) vehicle classification a view to being compatible with Michigan’s heavy vehicle standards to ensure the free flow of equipment between the two jurisdictions was front and centre, Bradley said.
Another area with the potential for future cooperation is the use of Long Combination Vehicles (LCVs), which have been operating under special permit in Ontario for several years and have increased productivity and reduced greenhouse gas emissions (GHGs), while maintaining the highest standards of highway safety.
As it stands now, LCV loads must be broken down in Windsor or elsewhere on the approach to the border and the freight distributed to two trucks as opposed to one.
“Given the synchronous cross-border manufacturing process that so identifies auto production in the region, the ability to cross the border with LCVs would be a giant step forward,” said Bradley. noting several other auto states currently allow some form of LCV including Ohio, Indiana and Illinois.
There are other areas where harmonization of truck weights and dimensions standards would be helpful, Bradley says, and to “further examine the potential, the level of ongoing dialogue between Michigan and Ontario, including their respective industries, needs to be increased.”
Bradley says OTA stands ready to assist with this effort and looks forward to working with officials together on both sides of the border.