How two new executive orders could impact your operation

You’ve probably heard that the Biden administration has issued a bunch of executive orders that target the transportation industry. But what will these orders mean for you?

In short, the executive orders could lead to schedule changes for railroads and increased scrutiny of prices charged by shipping companies.

President Joe Biden’s executive orders require the Surface Transportation Board (STB) and the Federal Maritime Commission (FMC) to speed up the implementation of two major proposals that were already in the works.

The STB is being told to ensure railroads offer rates that would better enable shippers to cobble together routes across competing rail networks, a concept known as reciprocal or competitive switching.

Meanwhile, the FMC is being told to crack down on late fees – also known as demurrage fees – through a partnership with the U.S. Department of Justice.

Cargo carriers and railroads believe the president’s executive orders are misguided. Industry officials say pricing pressures and other problems in the industry are being caused by a surge in post-pandemic demand rather than by the alleged anti-competitive practices of transportation firms.

The White House acknowledges the pandemic’s role in shipping problems but also insists that a lack of competition has allowed shippers and railroads to exploit the situation by charging higher prices.

Note: Remember that executive orders aren’t laws, and they can be quickly reversed by a new administration.

(From the August 2, 2021, issue of Transportation Manager’s Dispatch. To start your no-obligation trial subscription to the publication right now, please click here.)