The trucking industry is driving into new territory this December when the federal ELD mandate will require roughly 500,000 trucking firms to equip their rigs with electronic logging devices, or ELDs. The ELD mandate is perhaps the biggest change seen by the trucking industry in over 50 years. According to the 2014 Overdrive reader survey, 71% of owner operators planed to exit the industry over the mandate. With the implementation deadline less than a week away, many are wondering how will this affect our businesses. The truckload spot rate market is already running on tight capacity, fuel prices are up, and with a shortage of drivers, an increase in transportation rates seems almost inevitable, at least for the short term.
What is the ELD Mandate?
The new rule, passed by congress in December 2015, requires all commercial vehicles to be equipped with certified Electronic Logging Devices (ELDs) in order to enforce accurate hours of service regulations. The ELDs will replace the paper logs that drivers use to document adherence to federal .
Large contract carriers have already adopted the ELD, but many mid sized and small carriers have yet to implement the technology. Until now, in order for some to stay in business, they could massage their log books. 15 minutes could mean the difference between completing a delivery or rolling it to the next day. Without this flexibility, it's hard to imagine on time deliveries and available trucks like we're all accustomed to. There will be fewer trucks on the road. Forecasters predict a rise in the spot rate market at least for the short term.
How should a small or medium sized business prepare for the ELD mandate?
The ELD rule’s full impact will be difficult to gauge, since other variables can impact the remainder of 2017 and into 2018. It's an important time to understand the plight of the owner operator! The paper log and it's flexibility will be gone December 18th. Excessive time in live-load/unload situations, along with the time spent looking for a safe place to shut down, take up valuable hours of service. A loss of minutes, or hours, when compiled over many loads will dramatically reduce productivity over time. As a shipper or receiver, it's necessary to understand what drivers will be dealing with and implement some best practices to increase efficiency and offset some of the lost productivity.
Post ELD Best Practices for Shippers and Receivers
- prepare for a decrease in capacity
- reduce loading and unloading times
- treat driver's hours as a perishable commodity
- allow flexible pickup and delivery times
- provide on-site parking and amenities for drivers
- minimize cancellations and short lead times
- avoid multi-stop loads
- offer consistent loads and lanes
As shippers and receivers execute these practices, drivers productivity will increase to improve capacity. As the economy continues it's recovery, it's important seek and create strategic carrier partnerships and take action to minimize their time spent off the road. We all need to be involved in the ELD implementation. Communicating with drivers and respecting their hours of service will help ensure continued performance while dealing with this new reality.