A light approach to regulation and big tax cuts will be a boon for the trucking industry under a Donald Trump presidency, but Trump’s unpredictable management style poses a big long-term risk to the economy and motor carriers, freight economist Noel Perry said Wednesday.
“We are in an extraordinarily risky environment. Whatever you say about the politics of Donald Trump, his management style is highly volatile and therefore risky. It may give better outcomes, but it’s highly risky,” said Perry, chief economist at Truckstop.com and principal at consultancy Transport Futures, during an appearance at FreightWaves’ F3: Future of Freight Festival. “The trucking supply and pricing situation is a mess right now, and the geopolitical situation is the worst that I’ve experienced since back in the Vietnam days … and the demand side of the economy is [lackluster]. [The consumer] has been overbuying for a long time. So my message to my customers is that you need to be prudent for the next couple years, because all the risks are on the downside.”
The Trump administration is likely to water down the Environmental Protection Agency’s rulemaking on greenhouse emissions standards for heavy-duty trucks and kill plans to require that engines be equipped with a device to control a truck’s maximum speed, Perry said. California’s AB5 law that reclassifies many independent drivers as employees will also spread more slowly to other states, he added.
Perry, who went to school with Trump at the University of Pennsylvania in the late 1960s, said the president-elect will quickly move to extend the 2017 tax cuts from his first presidency, which will stimulate the economy for about 18 months and generate more freight for motor carriers.