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18 • December 15-31, 2020 Business GM walks away from stake in electric vehicle maker Nikola ASSOCIATED PRESS NEW YORK — General Motors will not be taking a stake in the electric vehicle company Nikola, which announced Monday, Nov. 30, that it would scuttle one of its marquee vehicles, an electric and hydrogen-powered pickup that was to be called the Badger. Shares of Nikola plunged 21% at the opening bell. Nikola on Nov. 30 released updated terms between the companies for a supply agreement related to GM’s fuel-cell system, replacing an agreement signed in September. That deal would have given GM an 11% stake in Nikola. The earlier agreement would have allowed Nikola to use GM’s new battery electric truck underpinnings for the Badger and its fuel cell and battery technology as well. But that is no longer part of the agreement. With that end of the partnership now gone, Nikola said Monday that it will begin refunding deposits made by customers who wanted first dibs on the company’s pickup truck. “In a nutshell, the signing of GM as a partner is a positive, but ultimately no ownership/equity stake in Nikola and the billions of R&D potentially now off the table is a major negative blow to the Nikola story,” said Wedbush analyst Dan Ives. “This went from a game-changer deal for Nikola to a good supply partnership, but nothing to write home about.” However, there were tremors under the potential partnership in late September. GM cast doubt on whether the $2 billion partnership would close as scheduled, saying that discussions with Nikola were ongoing. That announcement, which sent Nikola shares sliding, came just days after Nikola founder and Chairman Trevor Milton resigned after Hindenburg Research, a company that’s betting Nikola stock will drop, accused Nikola of Fraud. Nikola denies the allegations and called them misleading. Hindenburg said Nikola’s success was an “intricate fraud,” including a video showing a truck rolling downhill to give the impression it was cruising on a highway, and stenciling the words “hydrogen electric” on the side of a vehicle that was actually powered by natural gas. The Securities and Exchange Commission and the Justice Department are reportedly investigating. GM has said it did proper due diligence before entering the partnership. Nikola said Monday that its work on heavy trucks will continue. And GM will still be part of a global supply agreement that would integrate GM’s Hydrotec fuel-cell system into Nikola’s commercial semi-trucks. “Heavy trucks remain our core business and we are 100% focused on hitting our development milestones to bring clean hydrogen and batteryelectric commercial trucks to market,” said Nikola CEO Mark Russell. Nikola is based in Phoenix. 8 THETRUCKER.COM Courtesy: Nikola General Motors announced Monday, Nov. 30, that it will not close a deal that would have given the company 11% ownership of Nikola. In a separate statement, Nikola said it would continue the development of electric heavyduty trucks. b FMCSA from page 17 b exemptions are utilized as Congress intended. “Our nation’s farmers and agriculture haulers will benefit from this clarification of the rules and will be able to deliver their products in a safer and more efficient manner. These improved rules will help farmers move commodities and get food to our grocery stores. We have heard the concerns from our farmers and ag haulers and we’ve worked closely with USDA and the industry to provide regulatory clarity and craft this new rule,” said FMCSA Deputy Administrator Wiley Deck. FMCSA continues to work closely with the U.S. Department of Agriculture to eliminate confusion and further align the agencies’ interpretations of agricultural commodity definitions. 8 iStock Photo Van rates averaged $2.45 per mile nationally in November, a nickel higher than October and 8 cents higher than September. Refrigerated rates averaged $2.69 in another record month. b Rates from page 17 b buying trends continue. In its “Monday Morning Blog” entry for Thanksgiving week, even before the Black Friday shopping holiday, FTR Intel (ftrintel.com) led with the headline, “Holiday sales are already 11% above last December.” The blog quoted U.S. Census Bureau figures showing that U.S. industrial production increased by 1.1% in October, while manufacturing rose by a percentage point. Production of both durable and nondurable goods increased as well. Additionally, both existing home sales and permits for new home construction rose in October. All of these are indicators of a growing economy. The latest issue of ACT Research’s Transportation Digest described the down-andthen-up roller coaster ride the trucking industry has experienced this year. The report attributed online sales as having an impact on retail markets. “According to the Bureau of the Census, retail data show non-store sales, primarily e-commerce, from May to September were over 17% of retail activity, a material increase from a 14.5% average in 2019,” noted Kenny Vieth, ACT Research’s president and senior analyst. “Stating the obvious, e-retailing got a big boost when the shutdown drove households to do emergency shelf stocking and avoid brick-and-mortar retail locations.” The news, however, isn’t all rosy. COVID-19 infection rates have risen to new heights, and hospital wards across the country are overwhelmed with patients. In response, jurisdictions across the country have been implementing shut-down rules for businesses, along with mask mandates. Democrats that have called for a national shutdown may get their wish as President-elect Joe Biden takes office in January. Even without federal mandates, however, numerous states, as well as cities, have already implemented restrictions. Truck drivers are already experiencing difficulty finding open restaurants where they can obtain meals, and some fast-food locations are restricting hours or closing dining areas. On the flip side, legislators are still trying to hammer out a stimulus/relief plan that would provide supplemental unemployment payments and other benefits, possibly including cash payments, to Americans who are still suffering the economic effects of the pandemic. An added incentive could be the U.S. government budget, which expired Dec. 11. A stimulus bill could be tied to a new budget or a continuing resolution as a bargaining chip. Barring a complete shutdown, trucking is poised for a strong close to 2020 and a good start to the new year. 8
THETRUCKER.COM Business December 15-31, 2020 • 19 A little year-end preparation can help to start the new year right Cliff Abbott cliffa@thetruckermedia.com It’s that time of year again: The snow is falling in many parts of the country, and every truck owner’s dreams are filled with new steer tires, engine overhauls and chrome accessories. Hopefully, your dreams are more of the family type — spending the holidays with loved ones and sharing time, love and gifts. But the end of the year does bring some business options, too. Decisions made now can impact how much tax you’ll pay this year and next. Take steer tires, for example. A quality set can easily cost $1,000, including mounting and balancing. As a business expense, you won’t pay income tax on the cost of those tires. And, if you’ve had a great year and made a tidy profit on which you’d like to reduce your taxes, you’ll want to spend that $1,000 now, before the calendar runs out on 2020. On the other hand, if you expect your business to break even or even show a loss for the year, it might be better to hold off on that tire purchase until after Jan. 1 so the expense will count for the 2021 tax year. You can make the same decision about needed repairs or other expenses, including the last fuel fill of the year. You may even be able to pay your insurance bill early so you can count the expense in 2020, although paying it late is not an option. Don’t forget that the “income tax” you’ll pay on your profits will include self-employment tax. Self-employment tax is your Social Security tax of 6.2% plus Medicare tax of 1.45%, for a total of 7.65%, plus an identical share that would have been paid by your employer (if you had one). The grand total will be 15.3% on TOP of your incometax liability. It’s obvious that you’ll want to take each deduction during the tax year that benefits you most. You won’t have a choice for many expenses, but for expenses in December you Fleet Focus may have the option of waiting if doing so benefits your budget. December is a great time to gather up those receipts, too. Remember, every penny you can show was spent on the business is a penny you won’t have to pay income tax on. If you walk into your tax advisor’s office April 14 with a shoebox full of paper receipts, there’s a good chance your tax return will be late. Start preparing now. Receipts for fuel, repairs and maintenance, and truck items are a no-brainer, but drivers often overlook smaller expenses that add up as well. Products such as cleaners and accessories for the truck — including bedding, air fresheners and other items — are considered business expenses, provided they are used for the truck. Tools, flashlights and batteries, sunglasses and other items can also be business expenses. Industry publications can be business expenses too — but don’t try to claim your copy of The Trucker, since it’s free. Dues paid to trucking unions or organizations such as the Owner-Operator Independent Drivers Association (OOIDA) are business expenses. Clothing such as rain gear, gloves and steeltoed boots may be deductible. The IRS allows a deduction for a percentage of phone and internet expense. You use both in your business, so take maximum advantage. If you claim the standard IRS deduction for meals and incidentals, your records should include documentation of the days you spent away from home. Copies of your records of duty status will do the trick, but if you’re using electronic logs you may need a printout for your records in case of an audit. Motels, parking fees and shower costs that aren’t reimbursed may also be deductible. Don’t forget ATM or fuel card fees, and if iStock Photo When it comes to filing taxes, many purchases that can be written off might be obvious. Don’t forget, though, that tools, flashlights and batteries, sunglasses and other items can also be business expenses. your bank charges service fees for your business account; you can subtract those, too. If you purchase a laptop computer, a tablet or even a smartphone, you may be able to claim at least a portion of the cost as a business expense. If you don’t already have a tax advisor, now is a great time to find one. You might easily find someone to complete your tax forms, but you should be confident that your advisor is taking advantage of every opportunity to save you money. Another advantage that a tax professional who is familiar with trucking can offer is advice for next year. Finally, the end of the year is a great time to review your business practices. You should know your cost-per-mile of operation, including where the biggest areas for improvement are. You may decide, for example, that adding aerodynamic accessories to your equipment will help. Not only is the purchase cost a business expense you can deduct, but you’ll also get the fuel savings. You may find that your repair costs and down time are costing you more than the payment on newer equipment would. A good tax advisor can help with these types of decisions. As an owner-operator, you’ve got a business to run year-round. A little extra attention at year’s end, however, can help jump-start a better — and more profitable — new year. 8 THANK YOU to All of the Drivers Out There We are still hiring! Food-Grade Tankers Not getting the miles you need? Better pay & benefits - 401K match & paid vacation Driver requirements - 2 years experience - clean driving record - NO HAZMAT Call Today! 800-366-1216, ext. 1 www.agtrucking.com
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Page 9 and 10: THETRUCKER.COM Courtesy: Shell Rote
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Page 15 and 16: — Advertorial — CAT Scale celeb
Page 17: Business December 15-31, 2020 • 1
Page 21 and 22: Equipment December 15-31, 2020 •
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