Issue link: https://read.dmtmag.com/i/112433
INDUSTRY INSIDER When Nothing is Gained T he one item that remains constant in the trucking industry is change. Whether it be hours of service or equipment modification; the trucking industry is always changing. Once again, the FMCSA (Federal Motor Carrier Safety Administration) is looking at an hours of service ruling in July, 2013. As soon as the driver, safety director and enforcement agency memorize the current hours of service, the future changes are being proposed. Most people do not enjoy change, but when something is gained the acceptance is easier. The one fixed emotion in the trucking industry is safety. There is not a single driver, executive, mother and politician who are willing to sacrifice safety. Safety is a given in the trucking or transportation industry. This article will take a look at the ramifications if the new hours of service proposal remains. It is imperative to understand for every action there is a reaction. As an industry analyst, I will give you my 2013 reaction predictions should the hours of service proposal pass. When a change is made or proposed, the end result should be progress. I do not see any gains or progress on either side of the fence under the new hours of service proposal. Whether you like the current hours of service or dislike the hours of service; both parties fall short in their endeavors. Why you may ask? With the current hours of service proposal, drivers will work less. On the other side of the fence, if drivers have to take a mandatory two nights��� rest between the hours of 0100 AM and 0500 AM; the end result would be more driv- By Doug McElhaney ers hitting the road around 0500 AM and adding to the morning traffic congestion in large cities. The new proposal is counterproductive on both ends. In the world of business, we are always looking for a win-win situation. This is when both parties come away with value. I do not see any value here for consumers, the trucking industry and safety advocates. To sum up the ramifications of the new proposal, the results will be increased morning traffic, higher prices on common goods and a decline in asset utilization. I see no safety improvements. This is a lose-lose situation. With minimum profit margins, how much more productivity loss can carriers take? One large concern for most trucking executives is the loss of asset utilization. Let���s face it; most carriers do not have the luxury of high profit margins. If a carrier makes a dime per mile, they are operating efficiently. However, with the new proposed hours of service, the number of hours a driver can work (not drive) a week will be reduced by 17%. The maximum number of hours a driver can work will be reduced to 70 hours from 82. The new rule would require drivers to take at least two nights��� rest between the hours of 0100 AM and 0500 AM as part of the 34 hour restart provision. The 34 hour restart has been admired by almost everyone in the truckload industry. Many drivers feel fresh and rested after a 34 hour break. Unfortunately, the 34 hour restart will only be allowed once during a seven day period under the new hours of service. So, what are the results now? The damage is approximately a seven percent reduction in productivity. The driver and carrier are losing revenue. While looking at the previous paragraph, many carriers are going to have to make a solid business decision. Will they have to absorb the lost revenue or pass it the shippers? In a perfect world, the carrier would raise the shipper���s rates. However, the market will decide what the carrier can and cannot do. For example, if the demand for trucks is larger than the supply, the carrier will have economic leverage to increase transportation / Owner���operator/ March 2013 / / 54 OO 0313_text.indd 54 2/6/13 10:32 AM