Digital Edition

May 14 2018

Issue link: https://jocdigital.uberflip.com/i/977094

Contents of this Issue

Navigation

Page 46 of 71

May 14 2018 | The Journal of Commerce 47 www.joc.com Moving Goods 11 15 2 2 11 7 0 5 10 15 20 25 30 Curr ent Previous On- Duty Driving On- Duty Not Driving Off- Duty Drivers spending more time off-duty post ELD Source: Tiger Cool Express © 2018 IHS Markit Breakdown of driver hours before and after electronic logging device mandate Pre-ELD $300 ELD $220 Necessary $300 $0.00 $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 $0.80 $0.90 $1.00 0 5 10 15 20 ELD crimps driver earnings Source: Tiger Cool Express © 2018 IHS Markit Hours On-Duty Driving Driver $/Mile Driver pay by miles driven and hours on the road before and after ELD Theodore Prince TWENTY YEARS AGO, in his book, "Only the Paranoid Survive," Andrew S. Grove, president and CEO of Intel Corp., described Intel's sur- vival through the existential threats created by the drastic changes in its primary market. Grove framed the concept of strategic inflection points as "an event that changes the way we think and act." Grove observed that "not only didn't we realize that the rules had changed — what was worse, we didn't know what rules we now had to abide by." While strategic inflec- tion points offer an opportunity to elevate performance to new heights, they can also signal imminent demise. The need to make dramatic changes is frequently anathema to providers and purchasers. It also flies in the face of the traditional transportation credo, "It's not the way we've always done it." In the past 40 years, our industry has experienced several inflection points. • Motor carrier deregulation trans- formed domestic supply chains by replacing motor freight carriers (and their unionized workforce) with advanced truckload carriers (deploying owner-operators). • Globalization and the develop- ment of double-stack transporta- tion restructured the intermodal industry. • Y2K accelerated the development of enterprise planning and the deployment of transportation management systems. Since 1980, the US economy has become based on just-in-time trucking with an underlying reliable supply of trucking capacity and generally "reasonable" rates, both of which were expected to last forever. Hours of service Hours of service (HOS) for trucking date back to 1938, when the former Interstate Commerce Commission first limited work hours. Over time, permitted time pe- riods (and allowable work durations) have varied. In 2003, after extensive fatigue research, the Federal Motor Carrier Safety Administration (FMCSA) imposed a 34-hour restart. Modifications followed, and a final rule was published Dec. 27, 2011; it went into effect 18 months later, on July 1, 2013. The FMCSA published the electronic logging device (ELD) final rule on Dec. 16, 2015, with compliance due by Dec. 18, 2017. Strict enforcement was deferred until April 1, 2018. The interim period has been note- worthy for temporary exemptions and a phased-in enforcement. Grove observed that the need for transformation could arise with the introduction of a different regulatory environment. Change is unavoidable, but strategic points of inflection are not always obvious in real-time. In the future, it's likely that April 1, 2018 — the date ELD enforcement "went live" — will be enshrined as a red-let- ter day for our industry. Many trucking companies have been ELD-compliant for years, but there has been on-going on-line chatter from the late-adopters. While truckers complain about ELDs, they are most distressed that HOS rules will now be strictly en- forced. Routine enforcement will directly impact drivers who had previously been exceeding legal driving times with multiple log books. The accompanying charts illustrate the "driver pay algebra" Trucking industry's inflection point "Not only didn't we realize that the rules had changed — what was worse, we didn't know what rules we now had to abide by."

Articles in this issue

Links on this page

Archives of this issue

view archives of Digital Edition - May 14 2018