On the Road

For Whom the ELD Bell Tolls

December 10, 2015

SHARING TOOLS        | Print Subscribe
Life with ELDs will be an easy transition for some, not so easy for others. Photo by Jim Park.
Life with ELDs will be an easy transition for some, not so easy for others. Photo by Jim Park.

It's official, finally; hours of service is going electronic. By December 2017, the balance of America's 3 million truck and bus drivers that are still using paper logs will have to transition to electronic logging devices. My advice to those not already on-board with on-board loggers: Prepare now for a cut in productivity and make the necessary adjustment to your operation while you still can.

The transition will be most difficult for smaller fleets and their drivers, the ones without the capacity to relay loads or repower loads whose drivers have run up against the clock. Most of the success stories we've heard about ELDs come from fleets that successfully manage their drivers' time. Most of the tales of woe come from fleets that were ill-prepared for the change. The trouble is, we don't often hear from those fleets, because they are no longer in business and their drivers have moved onto other carriers.

This isn't an anti-ELD rant. It's a cautionary note. I speak from personal experience here, and I draw on accounts from others. The risk is very real if the transition isn't carefully managed.

Back in the late 1980s, under a very different HOS regime, the company (a 25-truck fleet) I worked for decided to install Rockwell Tripmaster electronic logs. Within a month after they were installed, the company yanked them from the trucks. There was one particular run – the company's gravy train – that ran us right to the HOS wire. Any delays, such as traffic, unloading, too long in the bathroom, etc., compromised the round trip. When all went well, we got home with 15 minutes to spare.

When things didn't go so smoothly, we could complete the rounder by making little adjustments to our paper logs. Not outright cheating, just adjustments to compensate for the irregularities of life. We're talking only 15 to 30 minutes, but illegal adjustments just the same. The company decided after a few weeks that it was just too expensive to relay drivers, have equipment parked rather than reloaded and turned around, etc. Out came the Tripmasters and life went back to normal.

More recently, a 300-truck fleet I have written about previously, which does retail store deliveries for some of the biggest of the big-box retailers, decided to implement e-logs. This outfit was an early adapter of e-logs, and suffered greatly for it in the short term.

Management knew drivers were making adjustments to their paper logs to render invisible the inevitable delays and glitches. While not condoned, it was excused in the name of efficiency and competitive pressure. The company knew, as well, that e-logs would make it impossible to adjust the delays out of existence and so, being highly proactive, decided to produce a video for its customers that explained the HOS rules drivers had to follow and the impact electronic logs would have on the operation.

The company also informed its customer base that it planned to add 10% across the board to its rates, and that it was going to pay the drivers an additional 10% to make up for the lost miles and revenue opportunities. It also announced it would need to add a day to most delivery times.

They lost about 40% of their business within a few months, but only a few of the drivers left. Within a year, once ELDs had become slightly more commonplace, all but one of the customers had returned, happily paying the 10% for the superior service. That other customer also returned later, having since installed e-logs in its own truck fleet and experienced the pain first hand.

This one is a success story, but it very nearly was not. The fleet took the risk and applied the wage increase before the rate increases took effect because it knew the danger of losing its drivers. When business took a dive and the company found itself in dire financial straits, many drivers were laid off anyway. Most have since returned, and the company's reputation as a great place to work has been restored. Actually, the company's reputation was never in question, but its inability to get the customers to go along with the new plan put it in dangerous territory.

Last fall, Avondale Partners analyst Donald Broughton told Transport Topics that about 350 small fleets (avg. 25 trucks) went under during the third quarter of that year. He said there were similar patterns in previous quarters, but as a comparison he noted that in the third quarter of 2013, 235 fleets with an average of 21 trucks dropped off the radar screen. He attributed those failures and others to Federal Motor Carrier Safety Administration requirements that individual fleets install electronic logging devices – something the agency has been making fleets do as part of its CSA intervention process.

Broughton told the paper he believes that the “vast preponderance” of these small-fleet failures [was] due to the productivity reductions from ELD requirements coupled with the then 2013 hours-of-service rule changes.

“Those fleets don’t have the lane density or the technological savvy to cope with that change,” he was quoted as saying.

With the ELDs installed, drivers quit because of reductions in mileage. Companies had to park trucks because they had no drivers. Then they tried to raise rates to attract drivers but still couldn't provide the miles drivers wanted, so more drivers left. "And then they fail[ed]," he noted.

That's the risk fleets still face today. It may be different two years from now, when shippers no longer have the option of moving their business to a more pliable carrier.

Nevertheless, in the time between today and December 2017, fleets will need to work with drivers and their customers to avoid the death spiral described above. Fleets that don't have the capacity or the flexibility to repower loads and schedule driver shifts to keep the freight moving will suffer, and probably lose work to fleets that can – unless they can successfully adapt to the new reality and pull their customers through with them.

Previous experience tells me that even those little adjustments can add up in a big way at the end of the week. Drivers may lose only a few hours of potential driving time due to ELDs, but the critical factor is when those hours disappear. It may mean the difference between a successful repositioning or an inconvenient layover, or making a delivery on a Tuesday rather than waiting 'till Wednesday. When that happens, the net reduction in operating time could have quite an impact.

My advice to the drivers and small fleets that currently take advantage of the flexibility provided by paper logs is to start logging 'em as you run 'em now, while you have the chance to work out the problems. Don't wait until later when ELDs take over and you're left over a digital barrel.

Comments

  1. 1. Kenny [ December 11, 2015 @ 05:05AM ]

    Food has out of date codes and spoils. Get ready American to get hungry. High Cost or just lack of product it will happen. Again just like the dot physical,hos and just simply Saftey the Fmcsa has failed but just like their president they are doing it hell or high water. As for experts telling you large fleets how to survive,let's see most of you have a 100 percent turn over and what I can see not a very good bunch of drivers. How is that working out for you. I compare this to Obamacare Which is a Financial and service failure. The main problem has not been address at all at the shippers and receivers by the Fmcsa so again it will still exist.But on the bright side this could be a hay day for the trure gypsies

 

Comment On This Story

Name:  
Email:  
Comment: (Maximum 2000 characters)  
Leave this field empty:
* Please note that every comment is moderated.

Author Bio

sponsored by

Jim Park

Equipment Editor

Truck journalist 13 years, commercial driver 20 years. Joined us in 2007. Specializes in technical/equipment material (including Tire Report), brings real-world perspective to test drives.

Newsletter

We offer e-newsletters that deliver targeted news and information for the entire fleet industry.

GotQuestions?

sponsored by

ELDs and Telematics Experts

The expert, Scott Sutarik from Geotab, will answer your questions

View All

GotQuestions?

Sleeper Cab Power Experts

The expert, Steve Carlson from Xantrex, will answer your questions

View All