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We are the voice of trucking.

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Welcome to Key Up New York, the official podcast of the Trucking Association of New York.

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I'm going to be your host today, Zach Miller. I'm the director of Metro Region Operations, and I'm joined today by Dan Panksa, who is the executive vice president of Kenworth Northeast Group.

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Dan, thank you. Welcome to the show.

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Thanks so much.

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So, you know, we have a really, really important topic to get through today, and we'll get into in a second. But, you know, everybody, you long time listeners and followers know we do like to open up with a little bit of an icebreaker and get to know somebody.

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So I'm curious, Dan, if you don't mind sharing a fun fact about yourself that most people don't know about you.

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And I know I'm putting you on the spot, so I'll give you a couple minutes to think about it. So mine is that I am actually an owner of multiple professional sports franchises.

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I have a share in the Green Bay Packers, which is fine because I'm a Jets fan and that has no impact. But I also am a shareholder in the Atlanta Braves, which is a little challenging because I am a diehard Mets fan.

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The reason why I bought the Brave Share was because ever since I bought the Packers, I bought the Packers share like about a year after they won the Super Bowl.

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And I was like, well, they have Aaron Rodgers and he's 27 years old. So obviously I'm going to win more Super Bowls.

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And I think everybody who follows football knows Aaron Rodgers does not do particularly well in the playoffs this year. He doesn't do particularly well whatsoever.

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And so clearly there's some sort of jinx on me in my ability to win a championship. And I thought, let me take that and put that on the Atlanta Braves.

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And I'm very happy to say that since I have purchased a share in the Atlanta Braves, they have not advanced in the playoffs.

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I'm actually an Atlanta Braves fan purely because when I'm 59 now and when I was younger, there was only certain teams that you could watch on TV when you were my age, when you were 10, 12, 15, 18 years old.

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And it was TBS, Atlanta Braves, because Ted Turner owned both of them.

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And it was Notre Dame because Notre Dame had had the contract on Channel 2. So I'm still a Notre Dame fan today for the same reason is because NBC used to have 10-year contracts and they had the Notre Dame game on.

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You didn't have the TV stations you have today and all the sports channels to watch whatever sports team you want to watch.

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So I became a Yankees fan because the Yes Network. I became a Braves fan because of TBS and I'm a Notre Dame fan because of the NBC.

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So I don't know if I really have a fun fact, but just my younger days of just adding on to your sports ownership.

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I became sports fans other than my home team, which anybody that's listening that watched Sunday Night Football happened to be at that game on Sunday night.

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It's good to be a Buffalo Bills fan and enjoying that ride right now.

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No, absolutely. And it's funny, we will get into ACT, I promise, but it's funny because I am between just everybody who I work with, either through membership or staff at TANI, who's such big Bills fans.

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The fact that the Jets are have been in the toilet for quite some time.

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And just the fact that I'm so beyond tired of the Kansas City Chiefs. It's just like I am at the very least for Buffalo to win the AFC.

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I don't know about Super Bowl or anything like that, but at the very least, if you guys cannot go to Kansas City and I don't have to see the Chiefs in the Super Bowl again, that'll be a big victory for me.

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Well, the Bills, you know, 25 years ago, we were in four Super Bowls and everyone felt the same, but we didn't win any of them.

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However, you know, I don't know if the Chiefs could get any more lucky than they have over their last four wins and the last one that they won because the Raiders just did something just ridiculously stupid.

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Again, but they just can't, you can't keep blocking field goals that are 25-yard field goals.

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You can't keep expecting a team to do something stupid and keep winning.

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So they've probably won six, seven, eight games by less than three points. And so maybe, maybe the football gods are on the Bills side this year. We'll see.

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Well, we'll see. But, you know, fingers crossed on that. You know, moving to the business at hand, we're here today to talk about the impact that the Advanced Clean Trucks Rule, or ACT, is going to have on, you know, dealers such as yourself throughout the state of New York.

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And just quickly, for those of you who are not familiar, the ACT is a California rule. It is a carb rule that New York, as well as I believe 11 other states adopted.

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And the rule is, it's a little complicated. It's a little technical. We don't really need to go too deep into it today, other than to say that it's a sort of OEM, or it was designed as an OEM mandate, where they're based on class.

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Based on class in year, there's a certain percentage of electric trucks that need to be sold to allow the sale of a certain percentage of diesel related trucks.

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Just as an example, in 2025, which is when it's supposed to start in New York, class 2B to 3 sales have to be 7% electric, class 4 to 8 sales have to be 11% electric, and class 7 to 8 tractors have to be 7% electric.

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And that, you know, corresponds to how many diesel equipment, you know, OEMs are able to sell.

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Now, you know, it's one of the things that's really challenging when it comes to this regulation is it's very academic.

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And for those of you who aren't very familiar with it, you know, you could go online, you could read about it, but you could see it's academic.

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You know, OEMs have to, you know, sell this to get this and all that. The challenge is, you know, they put in what is essentially an OEM mandate without looking at the other side of the equation, which is well, you know, it takes two parties to facilitate a transaction.

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There does need to be a buyer involved.

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And when it comes to equipment sales, there's also a dealer involved that is the point of sale. So there are a lot of nuances and factors that were not taken into account when this rule was written and adopted by the state of New York.

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And so it's really important that we get that dealer perspective. So, Dan, you know, if you don't mind just explaining what impact ACT is going to have on your operations.

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Well, you know, we sell, we have stores, you know, throughout New York state except the New York City area. And there's, you know, another camera group that's there and we talk all the time.

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And the impact is huge, right? So what they didn't put into effect account is there's so many different products that we sell that are not available.

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And that aren't even able to be an electric vehicle, right? So, you know, so not only the simple ones that you might recognize of the tractor trailer with the van trailer going down the road, you can get that electric vehicle.

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And then you have some straight trucks with a box on it. You can do that electric. But what about the dump truck, right? There are no today, there are no dump trucks, small or large that are electric.

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So what do those people do? They have to wait for a dealership to sell an electric vehicle so that dealer gets a waiver so I can sell that particular customer a diesel.

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So they can't if they, you know, and the thing that I when I was in Washington DC a few years ago and we were talking to the EPA, you know, our country was built on these people that started a company from very small and they grew their company and in our trucking world,

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you know, excavation companies, dump truck companies, you know, all these people that have built your houses in the businesses and in stadiums and companies and supermarkets and all these things, they are in the middle of this nightmare.

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They cannot buy a truck starting January 1, unless by chance, we sell an electric and we can get a waiver. But let me just be clear. If somebody buys an electric truck from me, let's just say, you know, a grocery chain or something buys one electric,

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they're going to require me to give them the credits to get them the diesels that they need to run their company. You know, a lot of people are calling this just like an electric tax, right? I'm going to buy a half a million dollar truck and have it sit there to get

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somewhere between six and ten diesels and they're just going to let it sit there because there's no infrastructure for those electric vehicles to actually run. They only go about 200 miles and that's in July without air conditioning during the day, going downhill with no lights on,

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no radio and those kinds of things, right? So if you understand the business and how the moving products works, you know, these guys, and I'll just use an example. If I had a delivery from Buffalo, New York to Albany,

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right, drop a load and come back. Let's just say it's food, groceries, going to go from Buffalo, New York to Albany. They can do that trip in four and a half hours, pick up an empty trailer, come back in nine hours, they get 10 hours of service at their home.

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If I had to do that with an electric truck, you would take the electric truck from Buffalo, you'd have to find some charger somewhere between Rochester and Syracuse, then you'd have to sit there for six hours to let it charge.

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Now the guy's out of time. You only get, because if you're fueling, you're still on work, so you're up to your 10 hours. So then you have to sleep overnight, get back in the truck, drive to Albany, find a charger, which there aren't any, find a charger that works,

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and then charge that, but then you're going to have to sleep overnight again because you're out of hours of service and then do the whole thing back. So it's going to take four days to deliver that one load that today takes one day to do.

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And that's, if there's a charger that works, but there are no chargers on the throughway, there's zero chargers on the throughway. New York hasn't installed any, neither has the power companies installed any.

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There's no charger. So if, and to install a charger, it takes so much wattage of power that most people don't have the power coming into their facility to put a charger on.

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So to put a charger in, we have them in two of our locations now. It takes at least a year, if not a year and a half, to get them to change, to put a bigger transformer on the pole, those big cylinder cans that are on the pole out front,

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that can take the power to put into your building. So you're a year and a half or two years out before that happens in about 250,000 bucks. So for one.

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So it's extremely costly. There is no infrastructure out there today.

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And, and, you know, I don't even want to get into going, you know, long term 10 years from now. If you go on the throughway and you're looking at their rest stops and the fueling stations and you see those, you know, diesel trucks pulling in to fill up, it takes about 20 minutes to fill up 300 gallons.

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And if it took six hours, how large were those fueling stations have to be to make sure that we can get our products that we knew we use for every single day. Right.

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People forget during COVID, everyone stayed home. Nobody left their house. But how what happened? Truckers got you the products so you can survive during that two year period and still function in life.

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Right. But today, we're telling you are the state saying, we don't care about that. We don't care. So that's that that's a challenge that the dealership has is one, we have to sell an electric vehicle that just to be clear, I have not quoted one electric vehicle yet.

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Nobody wants them. Right. I have two on the ground that we have ordered to show customers nobody wants to see him or hear him or talk to him or they have no interest.

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Then if we don't sell an electric vehicle, we get no credits to to sell diesel, which is what everybody wants.

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And to rewind a little bit, the diesel is so much burning so much cleaner today, then it is. It was 20 years ago and I'm going to use just a very, very, very simple way for people to understand what the

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emissions coming out of the exhaust pipe was 20 years ago to compare to compare to what it looks like today. And it's instead of using these crazy numbers and people don't understand knocks and all this stuff.

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Just think of the emissions of 20 years ago would coming out of the exhaust of a diesel would be like the size of a typical garage. Okay. It was a lot black smoke was coming up, you know, you get behind it, you could smell it, you could taste it, you know, it was sooty.

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It was bad, right. And then, you know, somewhere in 2000, let's just call it, they, they started to really clamp down on the emissions the engine manufacturers had to make it cleaner so I went from the size of the garage to let's just call it the size of a pickup truck, right.

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So it was like, hey, they kind of cut it in half and it was pretty good. And then let's say, you know, five, six years later, they took it from the size of a pickup truck and they, they did it to the size of, of, of, of like a desk in your office, right.

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So it's like, okay, you know, so so it went from the size of a garage the size of your desk, then it went to, you know, five years later it went to the size of a shoebox is like hey that's pretty impressive, right. It's like, you know, they got this this this emissions to really to be impactful now to where it's

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not, you know, hurting the atmosphere. And then five, six years ago they got it from the size of a shoebox to a size of a ring box. So it's, it's literally in a in a in a smoggy area, the air going into the truck is dirtier than the air coming out of the truck, right.

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So let's not talk about what trucks were 10 years ago, other than those trucks need to get off the road. Right. But what the trucks are today, I don't have the exact number but if you, if you had one truck from 20 years ago who drive from from Boston to California, you can have something in the neighborhood of 37 or 40

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drive from Boston to California today, and it would would would burn the same emissions, right. So that's the challenge and that's what people are understanding is we still the diesel trucks today are is dirty as people think, but the old stuff is and we're not saying

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electrification is not where we want this to go. We're just saying the infrastructure and the manufacturing is just not ready for it. Yeah, I spot on all those.

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I spot on all those points and that's to say nothing even of things like renewable diesel and biofuels and even other ways to power diesel engines to make them even more efficient.

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You know, there's a stat that we have, and I really hope I don't say it backwards but it's basically like a truck, a 1988 model truck will produce the same emissions as 60 trucks today.

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So it is incredible what the industry is done and continues to do and even to your point, you know, you gave a perfect example of, you know, my gosh, you talk about a region that is is very reliant on trucks about 90% of free, you know, in our region is transported via

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a truck, you know, to to force these extended trips, you're talking about between supply chain challenges that that would create between cost challenges that are created between frankly, the possibility and strong possibility I think of even more trucks on the road, which is another

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thing we're trying to reduce.

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And so for example was perfect I've given the example in New York City it does like yeah you know we have members that are based up in Rochester let the liver to the Bronx, you know, daily.

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How are they supposed to do that and on an electric truck.

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You know today, it's impossible here and here's the thing is they're not gonna right so this is what all my customers are telling me they're just not gonna so they're going to buy older vehicles, the ones that they could find the ones that are going to burn, you know, a lot more

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more emissions than the newer vehicles, and they're going to fix them and run them because that's okay. So, so to burn older stuff and into harmony environment is okay, but to have a new truck diesel that that burns much cleaner than than anything that's older

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than five years. It burns much cleaner. And it would be it would be different if the industry was ready for it but you know, you know, the New York State gave themselves a waiver so because they weren't prepared.

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There are no chargers there are no trucks that that you can make that to make a dump truck or a plow truck or sweeper or garbage truck that that works in electrification.

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So New York State just I don't know a few months ago, looked at this and said, I was on the call the one time when the head DOT person was like, Oh my God, we need to buy trucks this is not going to work for us and I'm like, Well, yeah, well you can't buy trucks just like all of our other customers.

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And, and, and I believe it was a lady at the time says, Well, we're going to change that.

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And they did. Right. And they gave themselves a waiver for if you're if it's a plow truck, if it's garbage truck that you put a plow in front of it because New York City does that, or sweeper helped me understand that one.

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You could you get a waiver so so New York State saying that you don't have to follow the ACP rules. But what about all of the businesses that are in New York State that don't have the power to give themselves a waiver.

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What are they going to do a small mom and pop guy that has a dump truck and it starts on fire. It rolls over or it's just too old and he needs to upgrade.

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Now that guy would upgrade his truck to a newer cleaner truck, but he can't.

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Right. He can't do it. Right. So, so, so, so they go out of business, then they have to leave the state to keep their business going. And there's, there's thousands of those guys in the states.

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There's, there's more truckers in there that that deliver products to our and help our economy in New York State than people realize.

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And they're out there every single day and people look at them and say, oh, they're big and they're this and that. But that's how we get our stuff.

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100%. I think this the last statistic I saw was like one in 29 jobs in the state of New York is in the trucking industry. And it is, you know, to your point, it is such a diverse industry.

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Yes, people have an image when they hear the word truck of what, you know, there's something that pops into their head of what it looks like.

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There are so many different types of equipment out there. And I think, you know, Tanny certainly is very, very supportive of electrification where it makes sense.

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We're starting to see tremendous growth in last mile electrification. We're starting to see really good movement in off road equipment electrification.

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But there are so many different pieces of equipment that trucking companies have, some of which many of which is just not ready to be electrified.

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And there's a lot of frustration that why aren't we moving the needle on things that make sense to your point.

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And why are we focusing on like, like you say, like, why are we worried about dump trucks or our sweepers or, you know, things like that when we should be focused on, you know, box trucks and delivery vans and, you know, things that could be electrified.

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Even cars, cars are working right. Cars. So I was telling a customer, I said, Hey, I just for the first time, you know, we have a place in Boston to a store.

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And my head of service has an electric vehicle and he says, you know, go for a ride. And, you know, it kind of was good.

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We had to stop twice to fill up. We had to find a Walmart. We had to get off the highway.

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But if you had a two car household, right, you had two car households, and let's call it in the next three to five years, the state said one of the two cars had to be electrification or an alternative fuel.

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And one could be gas, right? That's a start that helps get more charges out there. And if you had to go on a long trip to Albany, you take the gas vehicle, you go there.

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But if you're going back and forth to work in town, the electric vehicle would be fine to go back and forth.

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So you have alternate options. But the system and the system starting to get prepared for electrification.

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But trucks aren't that way. They don't just go 100 yards miles, right?

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A trucker goes out, he's gone for sometimes three, four weeks at a time, right?

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And they're saying, well, you know, we have systems in place to let that not be.

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Well, what's the system? What's the system for a dump truck to buy a diesel truck?

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Well, you have to sell an electric truck. Well, no one's buying one.

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And they're not buying one because there's no infrastructure. And the infrastructure was on the state to put the infrastructure in and they didn't do anything.

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But then they've realized they didn't do anything. So they gave themselves a waiver, right?

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But they didn't give anybody else in the state a waiver. And in the help, I would love somebody to explain to all of those companies that pay their taxes,

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that are good citizens and they donate to their charities and they're just good human beings, tell them that they're going to be out of business because you can't buy something to keep your truck business going, right?

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I don't understand it. And we all want clean air. We understand it. It's just the industry's not prepared for it. It's just not ready.

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No, I mean, the state of New York is not ready. And I think that's where you're seeing a lot of scrambling.

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I really loved your point too about how, you know, the unintended consequence of this is keeping older equipment on the road instead of replacing it with far, far superior newer equipment.

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So I am curious, on average, before, you know, pre-ACT, on average, how many trucks did you guys sell in a year?

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Well, we've grown, right? So we've expanded our footprint. So today I would tell you, you know, any given year we would sell somewhere between 600,000 and 1,000 units.

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So it's a lot in the trucking industry. You know, we, and then if you just look at the pure economic piece, I have zero electric trucks on order for next year.

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So I have zero diesel trucks on order for next year. Normally, if you sell 600,000 to 1,000, you'd have somewhere between 60 and 100 a month coming in.

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And then think about the sales tax revenue that the state's going to lose on that, right? The sales tax revenue and the FET revenue, which is, it goes to the, you know, the government, the federal government.

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But still, the sales tax, you know, every one somewhere between 7 and a half and 8 and a half, 9%.

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And, you know, if an average truck's, if average, call it $150,000, you know, you're talking 12,000 times 40 trucks a month because they're not all, you know, because tractors don't have sales tax.

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It just, and that's just our store, right? There's a whole bunch of other stores.

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And then, you know, this affects mobile homes. This affects, you know, so many different industries that people just don't understand the, I have a great video of President-elect Trump talking about electrification.

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And it is so spot on. And, you know, I don't care if you're Republican or Democrat, when you just, if you just listen to it, it's just spot on on, they're heavy, they're expensive, there's no infrastructure.

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They don't have, it doesn't fit a whole bunch of the industries. It takes too long to fuel. We're just not ready for it.

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So if you look at it as pure business, just pure business, it's just not ready for the electrification today.

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No, I totally hear you. And that's why, you know, this, this issue has really leapfrogged to the top of our government affairs agenda, you know, for that reason, because there's so much diversity in the equipment we use because there is zero infrastructure in place.

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The mandate is still in place, but the infrastructure is not. And that's something that we're really working on. I do want to end with a call to action, you know, for everybody who listened to Dan speak so eloquently on this issue and the real world impacts of it, right?

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We're not talking academic now, we're not talking about theory, we're talking about the real world on the ground impacts. The fact is, if, you know, what should be around 800 trucks, new trucks, clean trucks being sold are zero, what is that economic impact?

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What is that environmental impact? It's not just economy, it's also environmental.

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It would have taken, it would have taken dirty trucks off of the off of the street.

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Exactly, exactly. And so, you know, at TANI, we do have a call to action. We have a call to action center. It allows you to reach out to your local representative, it allows you to reach out to the governor.

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You know, please join our government affairs committee. This is one of our top, if not the top issues that we're dealing with. And that's why it's so, so important to get involved.

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Dan, thank you so much for joining us today. Thank you so much for the work that you're doing. Can't tell you how much we appreciate it.

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No, I appreciate what you guys are doing and we got to keep fighting for what's right. We want to be clean. We want to do it sensibly and we want to do it on a time frame that it makes sense for both sides.

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That's exactly it. And we can get there. We can get to our 2050 goals. This isn't an if or it's we can get there, but we need a really strong roadmap to do it. And right now, the ACT is actually causing more roadblocks than it is solving solutions.

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You guys are listening to KeyUp New York. Thank you so much. Please remember to like, subscribe and share and we'll see you next time.