Trucking Reregulation-What is Happening Now
Last week I gave a speech to about 100 members of the North Carolina League of Transportation and Logistics meeting in Charlotte. The topic was the challenge that shippers, carriers and drivers driver face in the current environment.
In 1980 the trucking industry was deregulated. This was a huge change in how our transportation system
Works Deregulation reduced barriers to entry and led to the growth of the large companies we now have and the existence of the 1,000s of small trucking companies.
In the twenty first century the federal government has initiated massive regulation of our industry. They have not regulated carrier authority. Instead, they have changed the industry forever in a number of ways. These changes include:
- Hours of Service. The hours of service regulations were the same from 1935 until January 4, 2004. Since then the hours of service have become progressively more restrictive. ATBS tracks miles for 40,000 owner operators. Their numbers show that driver miles have decreased by 17% from 2003 to now. The government is currently in the process of reducing the hours a driver can drive in a tour of duty from 11 to 10 and virtually eliminating the 34 hour restart.
- EPA engine particulate standards. The standards have been made more restrictive three times since 2004. Diesel engines are now “mobile air cleaners.” The air coming out of diesel engines is now cleaner than the air going into these engines. This has come at a very large cost to the industry.
- Diesel engines now cost $25,000 more than they did in 2004.
- Diesel engines now weigh 1,000 more than they did in 2004.
- Miles per gallon (in an age of $4.00 fuel) is now lower.
- Preventive maintenance needs to occur more often, is more complicated and is more expensive.
- CSA. The Federal Motor Carrier Administration (FMCSA) in the Department of Transportation (DOT) is in charge of managing the motor carrier safety and fitness. CSA (originally CSA2010) is their effort to improve the regulation of motor carriers. Conceptually this is a more efficient and comprehensive method to regulate the safety fitness of the 1,000s of carriers in this country. Like any other complex program “the devil is in the details.” How those details are decided and administered will determine the fairness and effectiveness of this approach.
- CSA impact on drivers. CSA introduces new metrics that measure driver performance such as all write-ups at roadside inspection and a federal motor vehicle report (which is more comprehensive than state MVRs). The definition of a “good driver” has been expanded. Carriers are now using measurements to determine the impact of each driver on their company CSA score. The federal government has also created the PSP report to document the record for each driver. This is used by carriers to vet drivers prior to employment. The estimates on the number of drivers that will fall out of the driver ranks as a result of CSA and PSP is estimated to be between 20,000 and 200,000.
- Electronic Onboard Recorders (EOBR). EOBRS track many items. They create the ability to do electronic logging. From a drivers perspective they are good news and bad news. The good news is they no longer have to write a manual log. The bad news is if they violate the hours of service it documents this violation. From a carriers point of view it means that dispatch needs to be legal. The pickup, transit and delivery times will need to be pre-planned and accurate.
- Other Items. The list is long and includes distracted driver laws (cell phones, etc.), sleep apnea (30% of drivers), functional agility testing and other items. Some of these items are becoming Federal and state laws. Some are items that carriers are using to insure that drivers can do the job safely and without injury.
My next blog will discuss what all of these changes mean to carriers and how carriers can get ahead of this curve.