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September 2 2019

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28 The Journal of Commerce | September 2 2019 www.joc.com Government Trucking companies still using AOBRDs must transition to ELDs by Dec. 16. WikiCommon A LOT OF attention was paid to the drop in driver productivity after the first electronic-logging device (ELD) mandate in the US two years ago, and trucking companies expect a similar impact when a second wave of fleets install the equipment by Dec. 16, which could mean shippers will face rate increases in 2020. Motor carriers using automatic on-board recording devices (AOBRDs) were given an extra two years to tran - sition to ELDs. Those two years will expire this December. Although Federal Motor Carrier Safety Administration (FMCSA) administrator Ray Martinez is warning fleets not to wait until the last minute, conversations with telematics compa- nies and regional fleets suggest many will do so. Even fleets that pay close attention to these issues acknowl- edged to The Journal of Commerce that they are still in the middle of the transition. The FMCSA in July rejected an application to exempt companies with 50 or fewer employees. Measuring lost miles Although the productivity drop may not be as steep as 2017-2018, trucking operator Werner Enterprises believes there could be a 1 to 3 percent decline in daily productivity for many fleets during the transition. That trans- lates to about four to 12 miles per day, per truck. Although this may appear inconsequential, multiply eight miles by five days and 52 weeks, that's 2,000 miles per truck, per year. Even if you lower the number to five miles per day, five days per week, and 50 weeks, it's 1,250 miles per truck, per year. If 2018 is any indicator, lost productivity will prompt fleets to raise rates on shippers because drivers will leave the industry if their paychecks — calculated on a per-mile basis — drop too much. "We think five miles per day is best-case and that's only after tremen - dous amounts of training and a com- mitment to being 100 percent legal at all times," Derek Leathers, CEO of Werner Enterprises, told The Journal of Commerce. "I think it'll end up averag- ing around 15 miles per day and when you multiply that across the industry, it's a fairly impactful number." Fifteen miles would equal a loss of 3,900 miles per truck, per year. A J.B. Hunt Transport Services white paper in 2015 on detention can provide an idea of real-world impact. Thom Albrecht, then an analyst with BB&T and now chief commercial officer with Celadon Trucking, found that after factoring in pre-trip inspec - tions, fuel, weigh stations, meals, route planning, and parking issues, a driver spends only 438 minutes driv- ing per day — about 7 hours. J.B. Hunt wrote that on a favorable day, a driver logs 406 miles in 535 minutes. Using the more favorable J.B. Hunt figures, a drop of 1,250 to 3,900 miles per truck, per year translates into a loss of three to 10 workdays per truck. Shippers served in that one- to two-week period will experience longer waits to move their freight and pay more to do so. Unforeseen issues Leathers provided an example of how the technological differences in an AOBRD versus an ELD could make a difference: If a driver repositions his truck to a nearby truck stop, the ELD automatically switches to on-duty status once the vehicle exceeds 5 mph, whereas an AOBRD wouldn't log this time before starting a shift. "While it's intended to be safety- oriented, what it prevents in real life is drivers simply moving their truck closer to the truck stop in the morning to grab coffee and breakfast before going on duty," Leathers said. "If it's not done very carefully, on ELDs it will start their clock. AOBRDs provide more freedom of movement in some of these cases." Brent Nussbaum, CEO of Nuss- baum Transportation, explains there are other situations, too. His company is transitioning from AOBRDs to ELDs on its 450 trucks. "With ELDs now, if a shipper comes out and tells the driver to move their truck while they are on their break, it will log them back on. Once they're on their break now, they can't move anywhere, whereas they could fudge that with an AOBRD," Nussbaum told The Journal of Com - merce. "It's been a bit of a frustration to a few of our drivers, but they're working through it." Kyle Kottke, general manager of Kottke Trucking, has AOBRDs on his 200 trucks. He's concerned about the transition process. "I have my first two ELDs and the balance is AOBRDs, and I am far from alone," he told The Journal of Commerce. "I am communicating every week with other AOBRD fleets talking about a transition plan and expected transi- tion issues. I think December will be tough just because many of us will be seeing problems we don't completely understand today." Although there will be other mac- roeconomic factors into how much shippers pay in trucking costs, supply chain executives should pay attention to how available capacity changes among regional truckload carriers. JOC email: ari.ashe@ihsmarkit.com twitter: @arijashe International | Washington | Customs | Security | Regulation ELD déjà vu This fall's transition from AOBRDs will trim US truck capacity and could boost rates By Ari Ashe "December will be tough because many of us will be seeing problems we don't completely understand today."

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