Towing: Finding A Better Way

The phone call reporting an accident or a broken-down truck inevitably leads fleet managers to ask if they will have to get the rig towed. That's when the blood pressure really starts to spike. Practically everyone in the business has a horror story about a towing job gone awry.

You won't get those stories in this story, though. This is about what the good guys are doing to construct a system that will give all the players – carrier, towing company, police and other emergency responders, and insurance companies — a chance to get their work done quickly, safely and at a fair rate.

It's as complex and intractable a problem as trucking has, for a couple of reasons.

Why There are so Many Truck Towing Horror Stories

First, towing is a local or regional business that is regulated — if it's regulated at all — by local or regional government. This means that there's no national solution. Problems between carriers, towing companies and police have to be solved locally.

Second, communication among the players has been inadequate, although that is changing.

Most towing companies are reputable.

"I don't want to send a message that the towing community is bad," says Oren Summer, president of FleetNet America, a leading provider of emergency roadside services that does business with some 14,000 towing companies. "They are great people. We do a lot of business with very, very high class people. It's just a few that pop their heads up that tank the whole theory."

Here's one towing company operator who sees the same problem.

"It would be really nice if ... everybody played by the same rules," says Michael Scott, president of Scotty's Carriage Works, a full-service company out of Cameron, Mo. "The problem is that it only takes one area where the system is not perfect, and that person will sour a couple of people and those people tell 10 other people, and it really goes downhill pretty quick."

And the problem has the potential to get worse as more trucks need tows. Summer keeps track of tows as a component of his business and has documented consistent increases in the number and cost of tows over the past several years. The occurrence of tows, among other repair jobs such as tires and alternators, increased from 6 percent in 2001 to 16 percent in 2005, for example, while the cost of tows rose from 9 percent to 20 percent.

He attributes this to an aging fleet as carriers postpone buying trucks with 2007 engines, and to shutdowns caused by electrical problems and particulate traps.

Non-Consensual Towing

If it were as simple as a carrier choosing not to do business with a particular towing company, the problem would be solved. But carriers cannot always control the situation. Often the call for a tow is placed by law enforcement or rescue personnel at the scene of an incident. They use a call list, called the rotation list, typically compiled by the regional divisions of the state highway patrols, Summer says.

This kind of arrangement – the term in the business is "non-consensual tow" – can lead to problems for both towing companies and carriers.

Bill Giorgis, president of Mike's Wrecker Service, a full-range towing company in Saginaw, Mich., described being dispatched by a carrier to an incident "in a municipality that refused to allow us to serve our customer because their preferred [towing company] was there. They hadn't started to work, but they were there and they wanted that guy to get paid.

"I think the reason our customer wanted us is because we provide what I like to think is a high-quality service at a fair price," Giorgis says. "His choice was denied because of whatever agreement that other [towing company] has with that municipality. That's not only an issue for us, but it is an issue for the trucking company as well."

Giorgis says he's seeing more and more communities stepping in to regulate towing – partly because they are cash-strapped. "They can regulate the taxicabs and the next logical step is, hey, what about that tow guy down there, can we tax him?"

Here's another angle on the issue from Summer: "We've had many, many, many incidences [in which] a repair or a recovery that probably should cost $2,500 to $3,000, maybe as much as $5,000, can cost as much as $15,000 to $20,000. Those people that do that, they hold hostage the equipment, essentially, until the owner pays whatever it is the [towing company] decides to charge."

Summer has seen towing companies removed from a list because of complaints about their business practices, "and then months later they are back on."

It also happens that a policeman or emergency responder will call a towing company on the rotation list and give incorrect information because he does not understand what the company needs to know. The result is that the towing company shows up with the wrong equipment, says Harriet Cooley, executive director of the Towing and Recovery Association of America, the national trade group of the towing industry.

The problem is not so much that the tow is non-consensual; it's that the system is not structured to protect carriers and towing companies from malfeasance or misinformation.

What the Industry is Doing About Towing Problems

The towing industry and the trucking community have been working the problem on separate tracks for a number of years, with some, but not much, success. But recently they began discussing a joint strategy.

Cooley said that TRAA has formed an exploratory group of towing companies to study an idea put forward by FleetNet America to establish a Towing Advisory Committee made up of carrier and towing industry officials. The committee would be similar to the Technical Advisory Group at the American Trucking Associations, Summer explains.

Summer's idea is to set up a system modeled on a practice that is now being used in South Carolina, in which a trucking company specifies the towing company for state police to call on the rotation list.

"The towing company has a letterhead that says this," Summer says. "When he arrives they allow him to take over. To me that is the only viable answer to begin the process of getting this on the right path," he says.

Summer comes to this realization after past attempts to solve the problem in different ways. Several years ago he was instrumental in getting the Technology and Maintenance Council of ATA to put together a Recommended Practice, RP 527, for selecting a towing and recovery vendor. The RP sets forth guidelines, such as what to ask about insurance, for carriers to use as they shop for towing services.

Summer also has looked into the possibility of drafting model legislation that state and local governments could adopt, but has determined that this is not practical – the political leverage is simply not there.

The federal government's instinct is to let states and localities take care of the problem, Cooley says. She is working with state towing associations to promote the idea of uniform regulation at the state level.

Cooley says the trend in the industry is toward requiring towing companies that want to be on rotation lists to be certified in traffic incident management – to understand not just their own job but the role everyone else is playing, as well. Unfortunately, she says, not all towers are participating.

She also says concern about highway congestion is prompting the U.S. Department of Transportation to encourage the towing industry to get better at clearing accident scenes. She has used that concern to the towing industry's advantage by obtaining DOT grants to support communication and education.

One grant helped produce a national tow truck driver certification program that has certified more than 10,000 drivers. A second helped produce and distribute an education program for towing companies. A third produced a vehicle identification guide to help emergency response officials explain the accident scene to towing companies so they bring the right equipment. Cooley is now working on a fourth grant to support regional seminars to bring law enforcement officials and towing companies together for training.

From Scott's perspective, communications of this type are essential. Firefighters and police need to understand that a towing company needs to charge more than $100 an hour if it is to open a road in 30 minutes with a piece of equipment that costs $500,000, he says. At the same time, towing companies need to understand how to do their jobs without messing up the policeman's accident investigation.

"The towing and recovery industry needs to step up to the plate and get that highway opened quickly and still protect our customer, which would be the trucking industry," he says.

One thing he'd like to see: Uniform insurance requirements for towing companies. He thinks towing companies should match the insurance requirements DOT places on trucking companies.

"If I'm carrying $2 million worth of insurance and you're carrying $30,000, naturally your rates are going to be different than mine. If we're all playing by the same guidelines, we're probably going to be pretty close to the same rate. If those rules are set down, you'll get a really qualified operator who'll do a fine job. But if they're not, you may get somebody that really tears things up."

Until the various communications and education programs that are now under way start to gel, carriers and towing companies are left with the old standby: good business practices.

Giorgis gave an example from his recent experience. A customer of his, Praxair, planned to introduce some new products that would bring a large number of trucks into his area. "Their safety people came to our office, met with our personnel and did joint safety training with them. They said, 'We want you to be educated so you can help serve us better.'"

"To me," Giorgis says, "that's the optimal customer-vendor relationship."