Cleaner air: Ernie’s Van & Storage bears cost of replacing fleet
June 4, 2013
Sometimes, it's better to embrace change than fight it. Sometimes, it's just better to look at expensive environmental regulations as an opportunity to invest in the future of your company.
This is the proactive attitude of the owners and management of Ernie's Van and Storage in Grass Valley.
"It's going to cost us about $1.3 million to come into compliance" with the Statewide Truck and Bus Regulation, according to Matthew Sowell, general manager of Ernie's.
However, "It will absolutely pay off in the long run," he asserted. "It's a blessing in disguise. We're going to come out of this with a brand new fleet and will be set up to do business on a large scale for the next 20 to 30 years."
Rules and rule-making
"The Diesel Risk Reduction Plan was adopted by the Air Resources Board in 2000 after diesel exhaust was recognized in 1998 by the state's Scientific Review Panel as being a toxic air contaminant. It causes cancer," said Karen Caesar, a public information officer for the California Air Resources Board.
The reduction plan is a far-reaching document covering all forms of diesel emissions, ranging from ships to farm equipment, she said.
One of the most difficult components of the plan was the Statewide Truck and Bus Regulation. The rules are so complex that the regulation wasn't finalized until Dec. 17, 2010, she confirmed.
The rule-making process "was a pretty fluid environment," Sowell agreed. "We got right on it as soon as the regulations were finalized."
Because complying with the truck and bus regulation is so expensive and complex, Air Resources Board is giving businesses a variety of early-compliance incentives, loans, grants and phase-in deadlines.
Ernie's is looking to come into full compliance by a Jan. 1, 2015, deadline, said Sowell.
Retrofit or replace?
One of the compliance options is to retrofit older diesel trucks (pre-2010) with particulate matter filters to capture oxides of nitrogen and other toxic pollutants. The other option is to purchase new trucks.
For Ernie's, retrofitting is not a financially feasible alternative.
"The filters are more expensive than the trucks are worth," Sowell said, noting one of the company's trucks has almost a million miles on it.
Therefore, the moving company is in the process of replacing its entire 14-vehicle fleet, which consists of both "straight trucks" as well as semi-trailer tractors. So far, they've bought three brand new trucks, including a $160,000 Kenworth T-680 semi-tractor. "It's a rolling hotel," said Sowell.
Designed for long-haul trucking, the Kenworth has a sleeper cab with double bunks and a refrigerator.
Another part of the diesel regulations requires trailers 53-feet or longer to have expensive, low-rolling resistance tires.
"We don't have 53-foot trailers by design," Sowell said. The 10 trailers the company uses range from 48 to 51 feet, which exempts it from that regulation. "The trailers are all good."
As for the new trucks themselves, they come equipped with filters and low-rolling resistance tires.
A whole industry of high-priced consultants has sprung up to advise trucking companies on how to comply with California Air Resources Board requirements. However, "We chose to learn it and do it on our own," Sowell said.
Besides, "We have friends in the industry we can always call up," he smiled.
"My dad and uncle are running a great company here," Sowell said. He credited his father, Douglas Sowell, and uncle Stuart Sowell, the owners of Ernie's Van & Storage, with learning the complex regulations. They also devised the company's long-term financial strategy to not only comply with the law but also continue to grow the family business in the years ahead.
"Yeah, it's been a [financial] hardship," Matthew Sowell conceded. "Every single penny we've saved goes toward the trucks."
Nevertheless, Ernie's financial strategy is to absorb the costs in-house and not pass them on to their customers, he said.
"We won't raise prices. We'll be one of the most competitive companies in the Sacramento area."
Sowell is clearly proud that the family business can afford to self-finance and maintain prices, but he also is equally proud of his family's continuing commitment to the community.
Whether it's moving the Grass Valley Chamber of Commerce for free last month or donating to Sierra Nevada Memorial Hospital or buying advertising to support Nevada Union High School sports, Ernie's Van & Storage is committed to giving back, he said.
Founded in Berkeley in 1935, Ernie's Van & Storage opened a branch in Grass Valley in 1976. It closed the Berkeley branch in 2001.
"We love it here," Sowell concluded.
Tom Durkin is a freelance writer and photographer in Nevada City. He can be contacted at email@example.com.
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